Energize Weekly, October 14, 2020
Corporate solar generating capacity continued its rapid growth in 2019 with nearly 1.2 gigawatts (GW) of new capacity – a 10 percent year-on-year increase, according to a survey by the Solar Energy Industries Association (SEIA).
There is now a total of 8.3 GW of corporate solar capacity at 38,000 sites in 43 states, with 50 percent of the projects installed in the last three years, the SEIA, an industry trade group, said.
The growth in corporate solar has been sparked by two key factors, the SEIA said – a 30 percent decline in installation costs over the last five years and more corporations making commitments to cut their emissions of greenhouse gases and to use clean energy.
Fifteen of the 25 top-rated companies in the association’s survey have goals that include 100 percent renewable energy.
Policies encouraging distributed solar have also helped. “One of the elements of why companies like Facebook or Google or Walmart are able to put solar on their rooftops or enter into those agreements to buy solar from a solar farm is because we’ve changed the regulatory structures to allow those transactions to happen,” Abigail Ross Hopper, SEIA’s CEO, said in a statement.
The Trump administration tariffs on imported solar cells and modules have slowed the price declines for installed solar since being imposed in 2018, pushing module prices in the U.S. 12 cents to 13 cents a watt higher than global prices. The tariffs step down and expire in 2022.
Still, the average installed price for a system in 2019 was $2.34 cents a watt compared to $6.48 a watt in 2011. The cost for larger systems – 1 megawatt (MW) or more – was $1.71 a watt in 2019.
As prices declined, the size of the average corporate installation has steadily risen, hitting 247 MW in 2019, a 67 percent increase in six years.
Walmart installed more solar than any other business in 2019, about 120 MW, bringing the company’s total to 331 MW. “They are the only company to have ranked in at least the top 4 every year since this report debuted in 2012, demonstrating their long-term commitment to renewable energy,” the SEIA said.
Apple has the largest total solar capacity 398 MW followed by Amazon 369 MW and Walmart. Rounding out the top five are Target with 285 MW and Google with 245 MW.
Target and Walmart top the list for individual installations through 2019, with Target counting 513 individual projects and Walmart 391.
On-site commercial solar projects account for about 70 percent of the capacity installed, but over the next few years, that is projected to change.
There are another 11 GW of projects under contract, with more than 5 GW expected to come online before 2022, according to consultant Wood Mackenzie. During the next three years, nearly 60 percent of all corporate capacity installed is expected to be off site.
Five states account for nearly 77 percent of the corporate solar capacity, led by California with 3.2 GW and New Jersey with 1.2 GW. Other leading states include New York with 922 MW, Massachusetts with 625 MW and North Carolina with 428 MW.
The installations are generally financed either through direct ownership or Power Purchase Agreements (PPAs), under which a company signs a long-term contract to buy the power.
In the last five years, the share of projects financed through PPAs has more than doubled to about 45 percent of the installations based on capacity.
“PPAs continue to increase their share of the commercial solar market,” the SEIA report said. “The low upfront investment, limited risk and predictable long-term electricity rates offered by PPAs tend to offer more value to businesses relative to homeowners.”