Solar industry leaders see signs of a quick recovery for their industry and expect massive growth over the next three years as federal stimulus funds recharge the industry and help increase access to financing.
Strong demand in the global solar marketplace and policy mechanisms such as Spain’s solar tax breaks meant the solar industry took longer to feel the effects of the current recession, but the first quarter of 2009 was rough for the industry, and now even Spain has reduced its solar tax breaks.
“The solar industry was virtually unscathed by the economic downturn until late last year, when funding for all types of projects dried up,” Reuters reports.
Despite the current economic environment, U.S. solar capacity grew by 16% in 2008 (PDF). Growth in some sectors – like photovoltaics (PV) – had been impressive, growing 100% in 2008 over 2007 levels until the downturn. Total solar capacity is forecast to add another 5.5 GW globally in 2009.
Stimulus funds from the U.S. and other governments are slated to be particularly helpful for the solar industry because it is one of the most expensive forms of renewable energy to develop. The industry is expected to receive $117 million in stimulus funds to support technology research, development and deployment in the United States. This is in addition to the $175 million solar appropriation in President Obama’s 2009 federal budget.
Suntech Power Holdings Chief Strategy Officer Steven Chan told Reuters this week that the company predicts the U.S. solar market to triple in 2010 as the financing freeze lets up and stimulus funds are implemented. Suntech plans to announce the location of a new manufacturing facility in the United States sometime this summer.
Spurring further confidence in the industry’s future are several major federal policies passed recently that provide the longer term stability investors crave. The Solar Energy Industries Association (SEIA) expects the new policies to generate at least $325 billion in private investment.
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