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US solar power installations slow in setback for climate goals

The pace of new US solar power installations decelerated last year for the first time since 2018, undercutting goals to cut carbon emissions from electricity supplies.

The 20.2 gigawatts of added generating capacity amounted to a 16 per cent decline from 2021 as a result of “policy-driven supply constraints”, according to a report released on Thursday by Wood Mackenzie and the Solar Energy Industries Association. Obstacles to greater deployment included trade restrictions and supply chain problems.

The drop came despite state-level clean energy incentives and run against US president Joe Biden’s goal of halving emissions by the end of the decade. Installations are expected to rebound this year, in part thanks to new federal green subsidies included in the landmark Inflation Reduction Act which passed last August.

However, solar trade groups warn the government support does little to relieve other impediments to the country’s energy transition.

“The IRA alone is not going to create the clean energy revolution that we anticipate,” said Abigail Ross Hopper, president of the SEIA. Hopper said the industry expected to see rapid growth, but “there are some pretty significant challenges that threaten its potential”.

Supply chain snarls exacerbated by trade restrictions have strained supplies of modules. Larger solar projects that supply power to the grid were the worst hit, with installations declining by 31 per cent as a result of probes into tariff-dodging by Chinese manufacturers and US customs seizures of modules linked to forced labour in China’s Xinjiang region, according to Wood Mackenzie and the SEIA.

More than 53GW worth of solar, wind and electricity storage projects ran into delays as of the fourth quarter of 2022, with solar accounting for nearly two-thirds of all projects, according to estimates from American Clean Power, an industry association. Supply chain challenges persist across solar development, with wait times for equipment such as transformers now stretching more than a year, say developers.

Once solar projects are built, they face long delays hooking up to the grid, a cumbersome process known as interconnection. The typical wait time is more than four years, according to the Lawrence Berkeley National Laboratory.

Roughly 360GW of solar power capacity awaited grid connections last quarter, approximately a third of all capacity in the queue and nearly five times current solar operating capacity, according to American Clean Power.

“Our ability to decarbonise in this country and to hit our goals is 100 per cent tied to our ability to improve grid infrastructure,” said Michelle Davis, Wood Mackenzie’s principal analyst for solar and the lead author of the report.

Part of the reason for the backlog is the need for more transmission lines, which carry electricity over long distances. A recent draft study from the US Department of Energy estimates the national transmission system would need to grow 57 per cent to meet power sector growth enabled by laws such as the recent bipartisan infrastructure law and the Inflation Reduction Act.

“Unless we find ways to get through these processes more quickly, deploy upgrades faster, we’re going to see a long lag,” said CJ Colavito, vice-president of engineering at Standard Solar, a developer. “It’s going to retard the industry’s ability to grow and deploy solar the way we need to.”

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