US Solar Energy Market Growth Flat So Far

US solar installations are expected to be flat this year compared with 2017 due to weakness in several major residential markets and slower growth in big projects, according to a report released on Tuesday.

The solar market, which for much of the last decade experienced runaway growth, is expected to be about the same as the 10.8 gigawatts installed in 2017, GTM Research said in a report commissioned by the Solar Energy Industries trade group, Reuters reported.

The solar market fell 30% in 2017. The decline was anticipated because in 2016, developers completed a slew of projects ahead of what was supposed to be an expiration of a key tax credit. Ultimately, the credit was extended.

GTM Research raised its forecast for utility-scale installations by 2% to 6.6 gigawatts, saying 2018 projects are relatively insulated from import tariffs on panels implemented by the Trump administration this year because many developers secured supplies prior to their implementation.

Most of the impact of the tariffs will be seen next year and beyond, GTM said, reducing its forecast for 2019 by 600 megawatts.

That market will still grow next year, by about 5%, but will be flat in 2021 and 2022 due to tariff-related project delays, the report said.

Module prices averaged 47 cents per watt during the first quarter of 2018, 24% higher than the 38 cents they averaged a year ago due to the US tariffs.

The research firm ratcheted down its residential market outlook for 2018 by 8% from 2.4 GW to 2.2 GW. Mature residential markets, including Massachusetts, New York and New Jersey are expected to decline this year, according to GTM analyst Austin Perea.

Residential solar fell 15% last year but was flat during the first quarter. GTM said that was a promising sign that the market was recovering from a pullback over the last year by national installers like Tesla Inc.

In the residential market, total system prices have stagnated due to the high cost of acquiring customers. Those costs have risen steadily over the last four quarters, GTM said.