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Solar industry jobs are growing at 20 times the national rate

Lucas Mearian | Jan. 16, 2015
There are now more than 705,000 jobs related to the solar power industry.

"Solar's remarkable job growth is closely tied to rapidly falling solar system installation costs," Ronen said. While 2015 is expected to be another banner year, the upcoming expiration of federal tax incentives and push-back from utilities losing market share may dramatically slow solar job growth in future years."

Another factor spurring growth is the impending end of the federal government's solar investment tax credit (ITC). That measure, passed in 2008, offered a 30% tax credit for residential and business installations. When it expires in 2016, the tax credit will drop to a more permanent 10%.

"Consequently, we expect to see a big rush of new installations ahead of the 2016 ITC expiration," said Deutsche Bank's leading solar industry analyst, Vishal Shah.

The outlook for the solar industry after the expiration of the ITC is less certain. The higher rate and long term certainty provided by Congress when it authorized an eight-year 30% tax credit in 2008 were key drivers to the industry's recent growth, the  report said.

However, not every respondent to the census agreed its expiration next year will greatly impact job growth. While, three-quarters of them said the ITC had "significantly improved our business," nearly 40% also said that having only a reduced tax credit  after 2016 would not impact their workforce. That may be because a large number of companies related to the solar industry, such as panel manufacturers and makers of solar pool heaters, don't qualify for the ITC in the first place.

The survey results may also be an indication that the solar industry sees itself as more competitive with traditional generation sources.

And while an October 2014 Deutsche Bank analysis found that extending the 30% ITC beyond 2016 would allow solar to be on par with market electricity rates in as many as 47 states, the study calculated that solar will still reach grid parity in 36 states even if the tax credit drops.

Today, according to Deutsche Bank, only 10 states boast solar energy costs that are on par with those of conventional electricity generation methods, such as coal-fired power plants. Those states include Arizona, California, Connecticut, Hawaii, Nevada, New Hampshire, New Jersey, New York, New Mexico and Vermont.

Last year, those states accounted about 90% of U.S. installations.

 

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