Business at downstream solar photovoltaic (PV) companies is growing exponentially in the Northeast, as home and property owners, spurred by government incentive programs, increasingly grow to realize and appreciate its value.
Sales at residential solar PV systems provider Astrum Solar in Maryland soared to $26.9 million in 2011 from $113,660 in 2008 – a staggering 23,567% increase. That marked Annapolis Junction, Maryland-based Astrum Solar as the second-fastest-growing privately-held company in Inc.’s annual rankings, according to a Gazette.Net report.
State and local government incentives, along with northeastern states’ Regional Greenhouse Gas Initiative (RGGI), is helping fuel demand for residential solar PV systems across the region. New Jersey, Massachusetts, Pennsylvania and New York can’t be considered the sunniest of U.S. states, yet all four ranked among the top ten U.S. states in solar PV installations in 1Q 2012, according to the Solar Energy Industry Association’s quarterly “U.S. Solar Market Insight” report.
Solar PV spreads across the sunny northeast
Focusing on expanding its business across the Northeast, Astrum Solar has been successfully expanding from its base in Maryland during the past three years. It now has offices in Connecticut, Massachusetts, New Jersey, New York, Ohio and Pennsylvania.
Astrum Solar’s expansion in Massachusetts, for example, is proving to be rewarding thanks in no small measure to the launch of the state-funded “Solarize Massachusetts” program. Administered by the Massachusetts Clean Energy Center, offers home and property owners discounted rates on solar PV installations according to a tiered pricing system. The more people that sign up for the program, the cheaper installation costs become, according to a Worcester Business Journal Online (WBJ) report.
The Massachusetts Clean Energy Center (MassCEC) also issues customer rebates that reduce the cost of installing a residential solar PV system further. A total $14 million has been allocated to the solar PV rebate program. Adding further to the savings, home and property owners who have solar PV systems installed can qualify for state solar renewable energy credits (SRECs) that can be sold to utilities and throughout the regional RGGI SREC marketplace.
Solarize Massachusetts expansion
The MassCEC’s expanding Solarize Massachusetts after a pilot program carried out last summer saw 165 residential solar PV systems installed across “a handful of communities,” according to WBJ’s report. That’s benefiting residential solar PV installers, such as Astrum, as well as local businesses.
Framingham, MA-based SolarFlair VP Dan Greenwood told WBJ Online that the solar PV installer is conducting between 15-20 residential site visits per week. CleanCEC selected SolarFlair to install residential solar PV systems in three towns designated as “green communities.” Greenwood said SolarFlair thinks as many as 300 homeowners will sign contracts with the company before the Sept. 30 program deadline. That would account for 40 percent of SolarFlair’s sales.
MassCEC selected Astrum Solar to carry out residential solar PV installations in six “green communities” towns. The Maryland-based company sold some 20 residential solar PV systems in the towns of Lincoln, Sudbury and Wayland by mid-July, just about the same number sold in the same area all of last year, WBJ Online reported.
Astrum Solar believes growth can and will continue even after programs such as Solarize Massachusetts runs its course, company VP of marketing Michelle Waldgeir told WBJ Online. “Solar is a great deal, even if you didn’t have this extra special discount,” she was quoted as saying. “The key in solar is there is low awareness about how accessible and affordable it is.”
Solar power still accounts for only a tiny percentage of electricity generated, with petroleum and natural gas-fueled power plants continuing to dominate the supply side of the power generation market in the state and region.
Mass green communities
One main thrust of Solarize Massachusetts is raising awareness and visibility across the state. Another is streamlining the bureaucratic process, which is awkward enough to dissuade prospective homeowners from having a solar PV system installed. That’s one reason MassCEC decided to designate one solar PV systems provider for each of the “green communities.”
In addition to their own marketing efforts, solar PV installers doing business in Solarize Massachusetts’ green communities are looking for good word-of-mouth advertising to keep sales momentum going after rebates and other aspects of the stare incentive program expires.
Massachusettts-based New England Clean Energy doubled its customer base, having installed 72 solar power systems during MassCEC’s 2011 Solarize Massachusetts pilot program. “Now we have a lot of very happy customers out there recommending us, which is phenomenal,” company president Mark Durrenberger told WBJ Online.
Also helping support and foster growth in the market, the Massachusetts legislature passed an energy bill at the end of July that raises the amount of renewable energy utilities operating in the state must purchase from 3 percent to 7 percent. A surcharge applied to all utility customers pays for Solarize Massachusetts’ incentives.
That makes those not installing residential solar PV systems unhappy, saying that they’re subsidizing others’ clean energy costs as a result of the so-called “net metering cap.” The actual overall impact of the net metering cap on ratepayers is unclear, however, according to MassCEC senior director of renewable energy generation.
Members living in State Senator James Eldridge’s (D-Acton) district are largely in favor the cap. Over the short-term as well as long-term, fostering solar and other renewable energy will yield substantial benefits, including lower energy costs and energy independence, he told WBJ Online.
Looking at the broader picture, solar PV installations rose more than 120 percent in the Americas in the first six months of 2012, according to IMS Research’s latest quarterly report, to reach 1.7 GW. That compares to 750 MW in the 1H 2011.
The U.S. solar PV market will contribute most to growth globally in 2012, making the U.S. the third largest solar PV market in the world, that despite industry turmoil and the imposition of anti-dumping tariffs and countervailing duties on imports of crystalline silicon PV cells and panels, according to IMS. The U.S. accounted for 40 percent of new solar PV capacity growth in 1H 2012.
*Photo credit: Astrum Solar