US solar capacity additions drop 25% in Q2'22

Solar capacity additions in the U.S. dropped 25% year over year in the second quarter of 2022, as policy and economic headwinds cut into project completions.

Project developers connected about 2.1 GW of solar capacity to U.S. grids from April to June, compared to nearly 2.9 GW that came online in the same period of 2021, according to S&P Global Market Intelligence data.

The quarter was marked by uncertainty on tax policy and trade restrictions, as well as by supply chain constraints, hampering efforts to ramp up project development. In May, U.S. solar panel imports plunged after foreign manufacturers moved to limit their exposure to the American market amid a federal trade probe.

Towards the end of the quarter, the industry got some policy clarity after the Biden administration decided to waive duties linked to the solar trade probe and invoke the Defense Production Act to "accelerate domestic production of clean energy technologies."

On Aug. 16, Biden signed the Inflation Reduction Act, which includes tens of billions of dollars in spending over 10 years to support renewable energy development and production, among other clean energy and grid investments. The legislation has stoked expectations that a massive fleet of photovoltaic factories could break ground as soon as 2023.

As of the end of the second quarter, the U.S. had a cumulative net solar power capacity of about 67.4 GW.

The U.S. currently has a solar project development pipeline of 165.5 GW through 2026, of which about 20.2 GW is under construction, Market Intelligence data shows. For 2022, 26.7 GW is in various stages of development, with 10 GW under construction and about 2.1 GW in advanced development.

The largest solar project that came online during the quarter was EDF Group's 345-MW Space City Solar Project in Wharton County, Texas. The facility has power purchase agreements with BASF Americas Corp and Enterprise Products Partners LP.

Other large projects completed during the quarter included Invenergy LLC's 250-MW Samson Solar Energy in Red River County, Texas; RWE AG's 196-MW Broken Spoke Solar Project (Hickory Park) in Mitchell County, Ga.; AES Corp.'s 180-MW Skipjack Solar Center (Keydet Solar A) in Charles City County, Va.; and NextEra Energy Inc. and NextEra Energy Partners' 150-MW Elora (Lincoln County Solar Project) in Lincoln County, Tenn.

In the second quarter, developers announced plans to build almost 9.8 GW of new solar projects, some paired with battery storage.

The largest of those is Hecate Energy's 1-GW Sunfish I and II Solar Project in Eaton County, Mich.

Several of the announced utility-scale solar projects will be located in Texas, including Repsol SA's 600-MW Repsol Solar Project in Falls County; Enlight Renewable Energy Ltd.'s 300-MW Horseshoe Bend Solar Project in Coleman County; Canadian Solar Inc.'s 200-MW Cascade Solar Energy in Brazoria County; and NextEra's 200-MW Sunlight Solar Project in Ector County.

Elsewhere, Enel SpA is building the 300-MW Butterfly Meadows Solar + Storage Project in Van Wert County, Ohio.

Texas leads the nation in solar projects in advanced development or under construction, with 7.9 GW of capacity in the late project stages. California came in second, with about 4 GW of such projects, followed by Ohio with 2.3 GW and North Carolina with 2.2 GW.

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