As 2015 draws to a close, thoughts are beginning to turn toward 2016 and what the new year will bring for solar power. The renewable energy market is constantly growing, thanks to government support and community initiatives that are spurring more widespread adoption of options like wind and solar power. As such, 2016 is poised to be a big year for the solar industry. This is due in part to the reduction of incentive options, as federal tax credits may be reduced by 2017. However, other factors are influencing the industry's bright future. The cost of solar energy is dropping, and more people and organizations are pushing for green energy alternatives to non-renewable sources. All of these reasons and more make it a good time for homeowners to begin considering solar financing and installation options.
Predictions for 2016 and beyond
The first half of 2016 is on track for impressive results in the world of solar, according to recent findings from IHS analytics company. Across the globe, installations are expected to grow at a rate of 12 percent. This is well below 2015's growth rate of 33 percent. IHS claims is due to the pending tax credit cuts in the United States as well as other policy changes in America as well as China, the other global leader in solar adoption.
However, the waning growth is still to the benefit of solar supporters. The researchers predicted that between January and June, solar manufacturers are going to produce 35 GW of panels in the U.S. alone, more than the 22.7 GW currently in use in America already, Fortune magazine reported.
"By 2030, solar may account for as much as 15% of overall electricity generation in the U.S."
While there will likely be a dip in installations in 2017, the solar industry will do just fine in the long run. Shayle Kann, the senior vice president and head of research at GTM Research, recently told PV-Tech that in the next 15 years, solar is going to shine. He predicted that solar will account for anywhere from 10 to 15 percent of the United States' electricity generation, an impressive increase given it is expected to reach 1 percent by the end of 2015.
"I find it very difficult to conjure a realistic scenario that doesn't include solar achieving the next order of magnitude by 2030, if not earlier," Kann told PV-Tech.
Why should homeowners act now?
The cost of solar energy has only dropped as it has become more common and less expensive to build, install and maintain the equipment. So some may think it would be better to wait until the upfront costs dip even further, but this could actually do more harm than good. Aside from the obvious idea that this would mean relying on more costly, less green non-renewable energy sources, homeowners could be missing out on opportunities to take advantage of federal, state and local incentives like rebates, grants and net metering.
Take the cost of electricity, for example. The 2015 Annual Energy Outlook Report from the U.S. Energy Information Administration projected the average retail price of electricity to increase 18 percent between 2013 and 2040. There is also the federal tax credit to consider. Right now, those who install solar in their homes and businesses may be able to take advantage of a 30 percent credit on their taxes. By 2017, that will drop to just 10 percent for businesses, but for residents, there will be no credit to take advantage of.
It's also important to consider the idea that, as renewable energy grows more common, the need to incentivize it will diminish. Legislation putting rebates and grants in place will expire, and there will be less need to renew the programs as more people adopt green energy alternatives, leaving fewer options for people and businesses looking to make the switch to recoup the cost of installing the equipment available.
Whether people are looking to save money on their bills or want to reduce their carbon footprint and make the switch to renewable energy, the time is right to begin investigating solar power options.