For 2023 the report highlights that it’s shaping up to be the strongest year on record for utility-scale solar, as the first eight months.
Berkeley Lab has released a report on “Utility-Scale Solar, 2023′ presenting an analysis of empirical plant-level data from the U.S. fleet of ground-mounted photovoltaic (PV), PV+battery, and concentrating solar-thermal power (CSP) plants. See the article : Riverhead considers adding battery energy storage systems to town code, as residents question safety, urge in-depth study. The report shares details on the capacities exceeding 5 MWAC or of 5 MWAC or less, which also includes residential rooftop systems.
Trends in Solar Deployment
The report explores trends in deployment, technology, capital and operating costs, capacity factors, the levelized cost of solar energy (LCOE), power purchase agreement (PPA) prices, and wholesale market value. The report says that 2022 was a strong year for PV+battery hybrid plants. The report adds that this was because the battery storage shifted to a portion of excess midday solar generation, and into evening hours that increased the value of solar.
The report finds that the PV+battery hybrid projects are becoming increasingly common, particularly in markets with a higher share of solar generation. The study highlights that in 2022, 35 PV+battery hybrid plants totaling 3.6 GWAC of PV and 1.8 GW / 5.4 GWh of battery storage achieved commercial operations. The report presents plant metadata, including installed costs and PPA prices, from a subset of these online and in-development PV+battery hybrids.
The report evaluates that there has been a massive pipeline of utility-scale solar plants dominating the interconnection queues across the US. The report states that, looking ahead, at least 947 GW of solar capacity was in the nation’s interconnection queues at the end of 2022. The report further adds that, nearly 457 GW, or 48%, of that total was paired with a battery.
Impact of IRA
The study shows that the Inflation Reduction Act (IRA), which became law in August 2022, introduced numerous provisions to stimulate additional clean energy deployment in the United States. These provisions, as per the report, are most likely to impact the utility-scale solar market including a production tax credit for solar, along with various tax credit adders (e.g., for prevailing wages, apprenticeships, location of projects in energy communities, using domestically produced equipment).
The report mentions that while these policy developments have generated much excitement within the industry, they do not yet see the impact of these incentives in this year’s utility-scale solar report, for several possible reasons.
The report elaborates that, this is due to first, the IRA was passed relatively late in the year, with Treasury guidance on implementation coming even later, and the market naturally takes time to react. The report finds that, additionally, several incentives only came into effect starting in 2023, while this report focuses primarily on projects built in 2022.
Secondly, the report says that interconnection queues from some of the bigger regions had either already closed their open application season by the time the IRA passed, or else did not accept or discouraged new interconnection requests in 2022. Nonetheless, for 2023 the report highlights that it’s shaping up to be the strongest year on record for utility-scale solar, as the first eight months.
Lastly, the report attributes this development to already yielded 8.6 GW of capacity additions, which is 30% more than the prior record pace through August set in 2021. Based on Environment Impact Assessment Agency (EIA) projections the capacity additions for September through December, could surpass 24 GW by the end of the year, which means that a total of new utility-scale solar capacity added in 2023.
Another report by Solar Energy Industries Association (SEIA) highlights how the passage of the IRA has been followed by a slew of announcements and movement in the US manufacturing space, the report says that since the IRA passed, 155 gigawatts (GW) of new production capacity has been announced across the solar supply chain. The numbers are way ahead of projections being made as recently as 2022 by US based manufacturers. which means that, the specific impact of IRA on US manufacturing and the solar sector, the report posits a ‘business as usual’ versus ‘Post IRA’ scenario, driving home just how impactful the IRA has been.