Thomas Neyhart is the CEO and founder of PosiGen, a New Orleans-based solar energy company. PosiGen operates in Louisiana, New York, Connecticut, New Jersey, and Florida. As per Thomas Neyhart, PosiGen was founded to make it easier and more cost-effective for more people to install residential solar energy solutions. The company does not have credit requirements for approving installations and invests in local communities to make it easier for everyone to enjoy the benefits of solar.
Some of the trends shaping the solar industry as identified by Thomas Neyhart are as below.
Growing Market Size and New Capacity
According to the Interstate Renewable Energy Council (IREC), an estimated 250,000 Americans work in solar. This represents 100% growth from 2012. About 60% of these workers are directly involved in solar PV installations. Also, according to the Solar Energy Industries Association (SEIA), the solar energy market generated over $25 billion in investments in the United States in 2020.
The U.S. Energy Information Administration (EIA) expects new electrical power generation from wind and solar to account for 70% of all newly added capacity in 2021. This year is also the first time new solar capacity will surpass that of new wind capacity.
As per Thomas Neyhart, with so much investment pouring into the solar space and the number of workers employed in the industry, solar is quickly becoming an engine for economic development.
Increased Demand and Changing Perceptions According to Thomas Neyhart
Demand for renewable power is rising, particularly for solar power. As per PosiGen and Thomas Neyhart, the uptick in solar-related activity and investment across the public, private, and political spheres has been well documented. As businesses expanding their solar portfolios, renewable energy legislation becomes clearer, and individuals become more aware of the cost-savings, energy independence, and other benefits of photovoltaic technology, there are many new opportunities for solar companies and other industry players to meaningfully contribute to the solar movement.
The solar power sector is also being transformed by traditional energy companies that are diversifying to include more renewables in their portfolios. Worsening climate change – combined with the cost-savings of solar – is driving the migration of power from dependence on coal to renewables. Thomas Neyhart says we expect solar demand from these players to increase substantially year after year.
While we see an increased demand for solar installations on homes and businesses, we see similar demand for everyday solar products. For example, demand for solar-powered generators, mobile device chargers, home lighting, and cookers has risen in lockstep with increased demand for solar electricity.
Finally, on the federal level, we see that the U.S. administration is focusing on clean energy and the environment. The inclusion of solar energy and electric vehicle credits in new infrastructure packages – combined with increased environmental sensitivity and advancements in sustainability initiatives – will likely lead to better, more favorable regulations for renewables and lower incentives for oil and gas.
Supply Chain Diversification
Global supply chains, built for efficiency rather than resiliency, were overwhelmed by pandemic-driven surges in demand. Thankfully, a lot more U.S.-based solar panel manufacturing is taking place today, decreasing our reliance on the handful of overseas manufacturers the industry has long depended on. In 2019, U.S. solar producers reached a 10-year high in market share of solar module production at almost 20%. Also, in 2020, solar installations in the U.S. grew by over 40%, also to all-time high levels.
A lingering issue, however, is price. Stateside production is more costly than overseas production, and these costs are invariably passed down to the consumer. As local production increases, however, and as local suppliers improve their forecasting and inventory management, we expect to see costs continuing to fall over the years to come.
Rapid Commercial, Residential, and Utility-Scale Growth
Investment tax credits (ITC) are a primary driver of the growth we’ve lately seen in solar. New residential and commercial solar installations can qualify for as much as 26% in credits based on the cost of the systems installed. At present, these credits can be claimed through 2022, but the window will eventually close, which is why many companies have chosen to invest in sustainable and subsidized energy solutions such as solar.
The same applies to homeowners who can enjoy similar subsidies and credits. Furthermore, education has also played a part in spurring the growth of solar installs as people become increasingly aware of the importance of conservation and the availability of local solutions that can lead to significant cost-savings over the long run.
Thomas Neyhart On What the Future Holds
Although there is a long way to go, the cost of solar has fallen substantially over the last few decades. Last year, solar energy was at historical lows, and the International Energy Agency (IEA) has found that solar is now the cheapest source of electrical power in many parts of the world.
Thomas Neyhart expects solar to continue to grow as local players ramp up installations and individuals and businesses learn more about the benefits of solar and make use of installation credits. Macro trends will also continue to contribute to the growth of solar across the nation, and Thomas Neyhart, PosiGen, and other solar players will continue to install solutions for individuals and businesses across the country.