Q4 2016/Q1 2017

Solar Industry Update

Robert Margolis, NREL

David Feldman, DOE
Daniel Boff, DOE

energy.gov/sunshot April 25, 2017

NREL/PR-6A20-68425 energy.gov/sunshot
NREL is a national laboratory of the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, operated by the Allilance for Sustainable Energy, LLC.
Executive Summary
The United States installed 14.8 GWDC of PV in 2016, an increase of 97% from 2015,
representing ~$30 billion in deployed capital, along with another $2.2 billion in U.S.-
manufactured PV products.
The United States ranked 2nd globally in annual PV installations behind China.
Cumulatively the United States had installed 40.4 GWDC at the end of 2016 and has
installed over 1.25 million PV systems.
1.4% of electricity generated in the United States in 2016 came from solar facilities.
While composing only 3% of U.S. installed electric generation capacity, solar
compromised the largest share of electric generation capacity additions in 2016 (~40%).
China installed approximately 34 GW of solar in 2016, 77 GW cumulatively, and now has
more solar capacity than the second largest market, Japan, by 34 GW.
In 2015, three states enacted net metering changes that lowered exported energy credit to
below retail rates; however, seven states increased their net metering capthere are now
22 states with NEM regulations, studies or proceedings pending.
In Q4 2016 residential installation costs (excluding SG&A) for two of the leading firms was
around $2.05/W with total costs ranging from $3.0/W to $3.5/W.
PV modules continue their sharp decline in price from the second half of 2016 with many
analysts estimating module ASP to be around $0.35/W.
These low prices caused global module manufacturers to have their sharpest decline in
gross margin since 2012. 2

energy.gov/sunshot
A list of acronyms is available at the end of the presentation.
Agenda

State and Federal Updates

Global Market Updates
U.S. Deployment
U.S. Pricing
Global Manufacturing
Component Pricing
Market Activity

energy.gov/sunshot
Legislative/Regulatory Action for Net-
Metering Effecting PV Enacted in 2016

DC

NEM Cap Increased (7 States) NEM Legislation Passed (2 States)

NEM Rule Or Process Changes (4 States) NEM Restored (1 State)

Solar credited between wholesale Solar Credited at Wholesale Rates or Below (0 States) 4
and retail rate (3 States)

Source: Meister Consultants Group, 50 States of Solar: Net Metering Quarterly Update (Q4 2016). energy.gov/sunshot
States with Pending NEM Regulations,
Studies or Proceedings

DC

Pending NEM Legislation (2 States) Active NEM Bill in State Legislature (3 States)

Pending Commission Proceeding or Docket (7 States)

5
DG Solar Valuation Study in 2016 (16 States)
energy.gov/sunshot
Source: Meister Consultants Group, 50 States of Solar: Net Metering Quarterly Update (Q4 2016).
Community Solar and Community Choice
Aggregation

DC

Community Solar Enabled (15 States)

Community Choice Aggregation (7 States) 6

Source: Meister Consultants Group, 50 States of Solar: Net Metering Quarterly Update (Q4 2016)., National Council of energy.gov/sunshot
State Legislatures.
Agenda

State and Federal Updates

Global Market Updates
U.S. Deployment
U.S. Pricing
Global Manufacturing
Component Pricing
Market Activity

energy.gov/sunshot
Top Ten PV Markets by Country
Annual Installations in 2016 (GW-DC) Cumulative Installations thru 2016 (GW-DC)
40 34 90 77
35 80
30 70
25 60
20 50 43 41 40 40
15 40
15
8 30 19
10 4 6
2 1 20 11 10
5 1 0.8 0.7 0.6 7 6 5
10
0 0

At the end of 2016, global PV installations reached 299 GWDC, up from 225 GWDC in 2015.
An annual increase of 74 GWDC
In 2001, there was only 1 GW of cumulative installations; the industry has thus grown by a factor of 298.
Globally, the United States installed the second most PV capacity in 2016 and is now one of the top four markets
in cumulative capacityincluding CSP, it is nearing the second largest global solar market.
The top ten markets represented 92% of annual PV installations in 2016.
China represented 46% of annual global installations in 2016.
Despite a large concentration of installs in a few markets, many new markets are expanding around the world
From 2012 to 2016, Asian countries (other than China, Japan, and India) installed 8.6 GW, African
countries installed 2.1 GW and South American countries installed 1.8 GW.
8

Source: All statistics from: IRENA Renewable Capacity Statistics 2017, except United States from (GTM energy.gov/sunshot
Research & SEIA: SMI 2016 Year-in-Review, and Japan from RTS Corporation.
Global Renewable Energy Investment
Global Renewable Energy Investments 2016 RE Investment
$350
$300
$250 VC &PE
1% Gov. R&D
Billions $

$200 Other
2%
$150 Wind Corp. R&D
Projects 1%
$100 Solar Public
$155 $141
$119 $144 $172 92% Capital
$50 $104 $114
$39 $61 $64 4%
$0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

$242 billion of investments were made in the renewable energy industry in 2016, down 23% y/y.
Approximately $114 billion of investments went into the solar industry, down 34%.
The drop in investments belies the fact that there was a record level of renewable power capacity added
in 2016 (~140 GW).
Renewable energy project costs dropped by more than 10% in 2016.
Many of the projects installed in 2016 were financed in 2015 and there was a slowdown in
investments in China, Japan, and the developing world.
The vast majority of investments dollars went to projects, rather than company development and R&D.
Solar R&D investment fell 20% to $3.6 billion ($1.6 billion from corporate R&D, $2.0 billion from
government R&D) mostly due to a 39% reduction in corporate R&D. 9

energy.gov/sunshot
Source: Global Trends in Renewable Energy Investment: 2017. FS-UNEP Collaborating Centre/BNEF.
Chinese Generation Capacity Additions by Source
Annual Capacity Additions (GW) Cumulative Capacity (GW)
160 1,800 1,646
142
1,600 1,521 77 Solar
140 125
121 15 1,379 43
111 1,400 1,258 25 Wind
120 11 1,147 16
96 11 34 1,200 1,063 Hydro
100 92
84 Solar 966
81 1,000 874 Other
80 Wind
Hydro 800 Nuclear
60 Other 600 Gas
40 Nuclear
Gas 400 Coal
20 Coal 200 Thermal
0 Thermal 0
2009 2010 2011 2012 2013 2014 2015 2016 2009 2010 2011 2012 2013 2014 2015 2016

In 2016, solar contributed 28% to new generation capacity in China (34 GW) and 5% of cumulative
capacity (77 GW).
Since 2009 China has doubled its installed electric generation capacity, and at the same time reduced
the percentage of total thermal capacity, from 76% to 64%.
From 2010 to 2016, new thermal generation capacity as a percent of total new capacity was
reduced from 63% to 43%.
10

energy.gov/sunshot
Source: China Electric Council, accessed 04/11/17.
China Update
China reported installing 34 GW of PV in 2016, compared to 15 GW in 2015, bringing its
cumulative total installed PV capacity to 77 GW.
In 2016, 30 GW of installations came from power stations and 4 GW from distributed PV
systemsrepresenting a similar proportion to previous years.
China reduced its five-year plan PV installation target to 105 GW (from 150 GW), leaving 30 GW
to be installed by 2020; however, the previous target was seen as a ceiling and the new target is
viewed as a floor.
China also has a target of 5 GW of CSP by 2020; however, unlike PV, it has fallen short of
previous CSP targets.
In December 2016, China also revised its 105 GW target which previously included a 60 GW
DG PV target; thus far the majority of PV installations in China have been utility-scale.
Not included in the installation target are the Top-Runner and Poverty Alleviation Programs:
The Poverty Alleviation Program has the goal of installing solar panels on the roofs of 2
million poor families by the end of 2020.
The Top-Runner program aims to accelerate PV technology improvement by setting
module efficiency standards.
Analyst projections of 2017 Chinese PV deployments range from 15 GW to 30 GW, which
would still make it the largest PV market by a wide margin.
11

Note: Some analysts believe that a portion of the 34 GW of reported installations in 2016 were actually built in 2015.
energy.gov/sunshot
Source: BNEF (03/30/17); CleanTechnica (12/09/16); Digitimes (03/28/17); Mercom (01/23/17); UBS (03/27/17).
China Update (cont.)
22 GW of the 34 GW of PV projects built in 2016 were installed in the first half in order to qualify for a
higher FiT; Chinese deployment picked up again in 2016 with the announcement of a 13%-19% FiT cut
set to take effect in July 2017, as well as the reduction in module pricing.
In 2017, some installers are expected to interconnect PV systems in H1 before all of the system is
built to receive the higher FiT.
China is introducing a voluntary REC program for which PV projects can register; they will decide in 2018
whether to make it mandatory.
Under the program projects receive payments for Chinese FiT Rate
RECs for energy, in lieu of FiT payments, which $0.18
cannot exceed FiT rates. Currently, project owners $0.16
$0.14
often wait two years to receive FiT payments, so $0.12
the REC program may actually improve project $0.10

$/kWh
cash flow. $0.08
$0.06
Chinese developers are focusing on projects closer to $0.04
population centers for easier interconnection; however, $0.02 Utility PV - Tier 1
Utility PV - Tier 3
Utility PV - Tier 2
Distributed PV adder
$0.00
they face higher land costs, including taxes on 6/30/2015 6/30/2016 6/30/2017 6/30/2018
agricultural land. PV Installation Date

12

energy.gov/sunshot
Source: BNEF (03/30/17); CleanTechnica (12/09/16); Digitimes (03/28/17); Mercom (01/23/17); UBS (03/27/17).
Japan Update
$0.50 12

Annual Installations (GWDC)

$0.40 10
8 Annual PV Installations
USD/kWh

$0.30
6 PV, >10 kW
$0.20 Res. PV (w/ PCS), <10 kW
4
$0.10 2 Res. PV (w/o PCS), <10 kW

$0.00 0
2012 2013 2014 2015 2016 2017 2018 2019
Japan installed approximately 8.5 GWDC of PV in 2016, compared to 10.8 GWDC in 2015, surpassing Germany as the
country with the second highest total PV capacity, with 43 GW.
PV represented 4.3% of electricity production in 2016 in Japanup from 2.7% in 2015.
PV installations are expected to fall again in 2017 to ~7.5 GW.
In March 2017 Japan announced revisions to its FiT program:
10-year FiT for residential systems < 10 kW and without power controlling systems (PCS) will drop from
JPY31(~$0.26) to JPY28 (~$0.24) in EY 2017, JPY26 in EY 2018, and JPY24 in EY 2019.
20-year FiT for systems >10 kw began at JPY42 (~$0.36)/kWh in 2012 and fell to JPY24 (~$0.20)/kWh in April
2016 will drop to JPY21 (~$0.18) in April 2017 (when energy year starts).
Starting in EY 2018, Japan will have an auction mechanism for PV systems above 2 MW in size.
There have been far fewer FiT applications with the lower FiT rates; however, there are still over 45 GW of
non-commissioned PV projects.
Notes: Japanese energy year starts in April. Values of feed-in-tariff (FiT) in chart are representative of energy year (EY); 13
installations are representative of calendar year. In EY 2015 the FiT for Japanese PV systems larger than 10 kW was 29
JPY/kWh from April to June. JPY/USD exchange rate is held at 0.00925 for all years. energy.gov/sunshot
Sources: BNEF (01/30/17; 02/17/17); EnergyTrend (03/22/17); IEA PVPS NSR Japan (September 2016); Mercom (12/26/16; 01/23/17).
Japan Update (cont.)
100%
% of Annual Installations

80%
60% 1MW+

40% 10kW-1MW
0-10kW
20%
0%
2012 2013 2014 2015 2016E

Japans PV market consisted of primarily residential systems before the FiT; however, it has since
transitioned to installing larger-sized plants.
Japanese PV developers have expressed concern over high system prices and the risk of energy
curtailment.
To date, curtailment has only occurred in two placesboth islandsand typically on holidays
with low-levels of demand.
In April 2017, Japan announced a plan to lower the cost of batteries installed with solar on
home-rooftops by as much as 70% by 2021.
Japanese PV manufacturing has fallen since 2013, from approximately 3.6 GW to approximately 2.7
GW in 2016.
14

Sources: BNEF (01/30/17; 02/17/17); EnergyTrend (03/22/17); Mercom (12/26/16; 01/23/17); SPV Market Research energy.gov/sunshot
(April 2017).
India Update
12

10
8.6
Annual Capacity Additions (GW)

6
4.1
4
2.3
2 1.0 1.0 0.9
0.0 0.2
0
2010 2011 2012 2013 2014 2015 2016 2017P

India has substantially increased PV deployment after years of uneven growth.

The country installed roughly 4.1 GW of solar in 2016 (up from 2.3 GW in 2015).
Capacity additions have doubled every year since 2014, and analysts expect it to
double again in 2017.
Solar currently represents about 1% of the nations electricity load.
The country is working to create a more effective policy environment, with analysts
projecting between 6 GW and 10 GW of deployment in 2017.
15

energy.gov/sunshot
Sources: Mercom (1/2/17; (2/24/15); 2017 analyst projections from slide 18.
India Update
India has set aggressive targets for solar, but has had difficulty meeting interim goals.
The country has a goal to deploy 100 GW of PV by 2022, but had only installed 10 GW of total capacity
at the end of 2016.
Developers have indicated that frequently changing policies have inhibited growth in the short term.
India has looked toward a variety of methods to incentivize solar deployment.
Utility scale deployment has also been driven by solar parks (right of way zones with transmission
access). The government has set a goal of 40 GW (recently doubled from 20 GW) of utility scale PV
deployment in solar parks.
India was one of the first countries to use tenders (reverse auctions) to facilitate PV deployment.
The nation has relatively generous SRECs that were priced between $86 and $52/SREC in 2016; these
prices are expected to decrease substantially in 2017.
Some states are also providing subsidies for net metered rooftop systems, and the national
government has set a goal of 40 GW of rooftop PV by 2022.
India has indicated that while it will incentivize PV deployment, it will not subsidize domestic
manufacturing.
PV deployment targets are closely tied to economic development targets.
Electricity demand could quadruple by 2040, as the country's population and economy expand.
As over 300 million Indians do not have access to the electricity grid, the strategy of employing both
centralized and DG PV is seen by the government as a way to electrify rural communities while
curbing pollution in urban centers.
16
Sources: Mercom (3/30/17; 3/24/17; 3/10/17; 3/6/16), World Bank (6/30/16); PV Tech (6/2/15), energy.gov/sunshot
CleanTechnica (2/30/17); Sivaram, The Global Warming Wild Card
Emerging Market Update
Annual Installations in 2016 (GW-DC) Cumulative Capacity thru 2016 (GW-DC)
4.5 18
4.0 16
3.5 14
3.0 12
2.5 10
2.0 8
1.5 6
1.0 4
0.5 2
0.0 0
APAC Africa Middle East South America APAC Africa Middle East South America

PV Deployment continues to be driven by a few nations, but some smaller countries have reached
GW levels of deployment.
South Korea has set ambitious goals for PV, announcing $28 billion of investment into renewables
by 2020; 5 GW of PV capacity were installed in 2016.
Chile remains the market leader in South America, and it has begun construction on the largest
solar park in the Americas, a 754-MW set of projects that will begin generating in 2018.
Nigeria has signed over 1 GW of PPAs for solar projects, that are beginning construction in 2017.
Saudi Arabia issued tenders for 700 MW of solar and wind projects, as part of a $50 billion push to
cut oil consumption.

17
Source: All statistics from: IRENA Renewable Capacity Statistics 2017, Bloomberg (4/17/17); CleanTechnica (4/17/17), PV
Magazine (7/7/16). energy.gov/sunshot
Note: APAC includes all listed IRENA countries in Asia and Oceana, except China, India, and Japan.
Annual Global PV Demand
120

Europe Historical Projection

PV Annual Installations (GWDC)

100
ROW
India
80
Japan
China
60
U.S.

40

20

0
2011 2012 2013 2014 2015 2016E 2017P 2018P 2019P 2020P
Analysts recently estimated that approximately 75 GW of PV was installed globally in 2016 (54 GW in
2015), bringing the cumulative total to ~300 GW.
China (~34 GW) and the United States (~15 GW) were the two largest markets in 2016.
Annual global installations are projected to grow to be 69 GW109 GW by 2020.
The median analyst figures estimate that 380 GW of PV will be installed globally from 2017 to
2020, more than doubling current installed capacity.
The majority of the growth is expected to come from emerging markets (ROW).

Note: E = estimate. P = projection. Bar represents median projection. Error bars represent high and low projections. 18
Sources: 2016 figures from slide 8. Other data displayed represent the median figures from the following sources:
BNEF (02/17/17); Cowen & Co. (10/16/16); Deutsche Bank (04/24/17, 03/09/17, 10/19/16); Goldman Sachs energy.gov/sunshot
(01/02/17), GTM Research (January 2017); IHS Technology (03/31/17); UBS (January 2017).
Historical Projections vs. Actual Global
PV Deployment
120
Bar represents median projection. Error bars represent high and low
projections
100
Q1 '17 Estimates
Q1 '16 Estimates
Global Demand (GW)

80
Actual
Q1 '15 Estimates
60 Q1 '14 Estimates
Q1 '13 Estimates
40 Q1 '12 Estimates

20 Q1 '11 Estimates
Q1 '10 Estimates
0
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Analysts have historically underestimated future PV deployment, particularly in years with large
changes in deployment (e.g., 2011, 2016) and for longer-term projections.
The median analyst projection, made in Q1 2011, for global deployments in 2015 was 22 GW
and the highest projection that period was 40 GWactual deployment was approximately 50
GW in 2015.
Notes: Analyst projections may vary due to differing methodologies of projecting installations or shipments. Median, 19
maximum, and minimums may also vary because of the differing set of analyst projections for each year. Q1 estimates
also include estimates made in Q4 of the previous year. energy.gov/sunshot
Sources: 56 separate estimates from 20 institutions.
Historical Projections vs. Actual U.S.
PV Deployment
25
Bar represents median projection. Error bars represent high and low
projections
20
U.S. Demand (GW)

Q1 '17 Estimates
15 Actual

10 Q1 '16 Estimates
Q1 '14 Estimates Q1 '15 Estimates
Q1 '13 Estimates
5 Q1 '12 Estimates
Q1 '11 Estimates
0 Q1 '10 Estimates
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Due to relatively stable federal policies in the United States, the median projections were relatively
close to actual deployment.
Despite knowing of the potential expiration of the ITC in 2016 most analysts historically
underestimated PV deployment in that year.

Notes: Analyst projections may vary due to differing methodologies of projecting installations or shipments. Median, 20
maximum, and minimums may also vary because of the differing set of analyst projections for each year. Q1 estimates
also include estimates made in Q4 of the previous year. energy.gov/sunshot
Sources: 56 separate estimates from 20 institutions.
Historical Projections vs. Actual U.S.
Module ASP
$5.0
Actual Estimates made in 2012-2017
$4.5 Estimates Made in 2008 $1.0 Actual
2009 2012
$4.0 2010 $0.9 2013
Module Price (2016 $/W)

$3.5 2011 $0.8 2014

Module Price (2016 $/W)

2012 2015
$3.0 2013 $0.7
2016
2014
$2.5 $0.6 2017
2015
$2.0 2016 $0.5
2017
$1.5 $0.4

$1.0 $0.3

$0.5 $0.2
$0.1
$0.0
$0.0
2012 2013 2014 2015 2016 2017 2018 2019 2020

Historical deployment likely exceeded expectations because PV pricing has dropped faster than
historically expected.
A rapid drop in module price from 2008 to 2012 caught many in the industry by surprise causing the
module ASP for 2012 to be almost 3X lower than was expected in 2008.
A similar trend is occurring in 2017the median estimate of 2017 module ASP made in 2014 was
approximately $0.57/W; in the first three months of 2017 the median estimate was $0.37/W.
21

Notes: Median, maximum, and minimums may vary because of the differing set of analyst projections for each year. energy.gov/sunshot
Sources: 86 separate estimates from 17 institutions.
Agenda

State and Federal Updates

Global Market Updates
U.S. Deployment
U.S. Pricing
Global Manufacturing
Component Pricing
Market Activity

22

energy.gov/sunshot
U.S. PV Demand
25
Historical Projection
PV Annual Installations (GWDC)

Utility-scale
20 Non-Res.
Residential
15

10

0
2013 2014 2015 2016 2017P 2018P 2019P 2020P
Analysts estimate U.S. solar installations in 2017 will be between 8.5 GW and 13.5 GW - a drop from the 2016 peak, however, larger
than every other previous year.
The drop in deployment is expected to come entirely from the utility-scale sector, as the other sectors are expected to grow
between 2016 and 2017.
The median analyst figures project that 50 GW of PV will be installed between 2017 and 2020, more than doubling the current
installed capacity of 40 GW.
Between 2017 and 2020, utility-scale PV installations are projected to remain the largest market sector; however, the distributed
market is estimated to grow beyond 6 GW of annual deployment by 2020.

Note: P = projection. Bar represents median projection. Error bars represent high and low projections 23
Sources: 20132016 data from GTM Research & SEIA (U.S. SMI 2016 YIR); 2017-2020 data displayed represents the
median figures from the following sources: BNEF (12/20/16); Cowen & Co. (08/23/16); Deutsche Bank (010/15/16); energy.gov/sunshot
Goldman Sachs (01/02/17); GTM Research & SEIA (March 2017); IHS Technology (3/31/17).
U.S. Generation Capacity Additions by Source
40
Other U.S Generation Capacity Additions,
Hydro 2016 (Total 28.5 GW)
U.S. Capacity Additions/Retirements (GW)

30 Nuclear Nuclear, 644 Other, 345

Oil
20 Coal
Gas DPV, 3,405
10 Wind
Natural Gas,
CSP
7,532
0 UPV
DPV
UPV, 7,865
(10)
Wind, 8,738

(20)

(30)
In 2016, for the first time in U.S. history, solar was the largest source of new electricity generation
capacity, with approximately 40% of all new generation capacity.
Wind and solar combined for 70% of new generation.
U.S. has installed ~20 GW of new capacity per year in past decade, while retiring ~17 GW annually in
the past five yearsthe retirements are mostly gas plants, which are being replaced, and coal plants.
It would take 50-60 years to change the entire U.S. generation fleet at the current pace of
replacement.

Sources: 2004-2010 (except solar): EIA.U.S installed capacity, Form 860. 2011-2013: FERC: "Office of Energy Projects 24
Energy Infrastructure Update for December 2012/2013/2014/2015." 2006-2013 Distribute Solar (DPV), GTM/SEIA,
U.S. Solar Market Insight Q4 2014, using PV converted to AC using .8333 derate factor. 2014 DPV, SEPA 2014/2015 energy.gov/sunshot
Solar Market Snapshot. 2009-2016 Utility PV, and 2015-16 DPV, EIA Electric Power Monthly (February 2017).
U.S. Electric Storage Capacity, December 2016
700 December 2017 25
U.S. generating capacity, storage (MW)

U.S. generating capacity, pumped

600
20
500

storage (GW)
400 15

300 December 2015 10

200
December 2014 5
100

0 0
CSP with storage Batteries Gas w. compressed air Flywheels Hydro pumped
storage storage

As of December 2016, CSP had the third-largest storage capacity of any technology in the United States,
behind pumped storage (23 GW) and batteries (540 MW).
U.S. battery storage grew 85% in 2016, and the EIA plans for a further 26% increase in 2017 to 678 MW.
2017 plans may underestimate battery growth as previous years planned total was 24% of what
was actually installed in 2016.

25
Source: EIA Electric Power Monthly, Table 6.1. Electric Generating Summer Capacity Changes (MW), energy.gov/sunshot
November 2016 to December 2016.
U.S. Electric Storage Capacity vs. Duration, April 2017
4.0 350 # of Hours for U.S. Deployed
GWh

U.S. generating capacity, pumped

U.S. generating capacity, storage

3.5 GW 300 Battery Storage

3.0 >5 hrs

storage (GW/GWh)
250
6%
2.5
(GW/GWh)

200
2.0
150 1 hrs - 5
1.5
hrs <0.5 hrs
100
1.0 23% 40%
0.5 50
0.5 hrs -
0.0 0 1.0 hrs
CSP with Batteries Gas w. Flywheels Hydro 31%
storage compressed pumped
air storage storage

Despite batteries growing to be the second largest source of storage in the United States they provide
fewer hours of storage than other technologies, such as CSP.
For example, CSP plants with storage can provide, on average, six hours of energy, versus one hour
for batteries.
40% of U.S. deployed battery systems can provide fewer than 30 minutes of storage, while only 6%
offer more than 5 hours of storage.
Short- and long-term storage provide different services to the grid.
Short-term storage can smooth variability in generation while long-term storage can replace
baseload power. 26
Source: Department of Energy Global Energy Storage Database, accessed April 20, 2017. energy.gov/sunshot
https://www.energystorageexchange.org/
2016 U.S. Capacity and Generation
UPV DPV
2016 U.S. Generation 2016 U.S. Capacity
CSP
4,100 TWh CSP UPV DPV 1.1 TW
0.1% 0.8% 0.5%
0.2% 1.8% 1.2%
Geo Other Geo Other
Wind 0% 3% 0% 7%
6%
Hydro Wind
6% 8% Coal
Coal
25%
30% Hydro
7%
Nuclear
20% Nuclear
9%
Nat. Gas
Nat. Gas 41%
34%

Despite solar representing a large amount of new generation, it still represents a relatively
small amount of total U.S. capacity and generation.
At the end of 2016, solar represented 3.2% of net summer capacity and 1.4% of annual
generation.
65% of U.S. generation came from fossil fuels in 2016 with another 20% coming from nuclear.
Capacity is not proportional to generation as certain technologies (e.g. nat. gas) have
lower capacity factors than others (e.g. nuclear).
27

energy.gov/sunshot
Sources: EIA Electric Power Monthly (February 2017).
U.S. Generation, 20062016
2,500 1.6%
1.4%
Annual Generation (Twh)

2,000 Coal

% of Total Generation
1.2% Nat. Gas
1,500 1.0% Nuclear
Hydro
0.8%
Wind
1,000 0.6% UPV
0.4% DPV
500 CSP
0.2% Geo
0 0.0% Other
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 % of Solar

Coal and natural gas generation have been heading in opposite directions.
In 2016, natural gas facilities produced more electricity than coal facilities for the first
time, compared to 2006 when coal generated approximately 3X natural gas.
Despite solar only contributing 1.4% of electric generation its percentage has increased 73X
since 2006.
28

Sources: EIA Electric Power Monthly. Solar DPV values before 2013 are from SEIA & GTM Research, energy.gov/sunshot
assuming an average production of 1,300 kWh/kW.
U.S. Installation Breakdown
U.S. PV Installations by Market Segment U.S. PV Installations by State
16 14.8 (MWDC), 2016
Utility
14
Non-Residential
Annual PV Installed (GWDC)

12 Residential
10
Other,
7.5 5,497 CA,
8
6.2 5,096
6 4.8
4 3.4
1.9
2
0.4 0.9 NV, GA,
0.1 0.2 0.3
984 1,023 UT,
0 NC, 923
1,241
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

The United States installed 14.8 GWDC of PV in 2016, 40.4 GW total

2016 PV installations were larger than 2014 and 2015 combined, or all PV installations
before 2014 combined
Utility-scale PV installations represented 72% of 2016 annual installations; however, the
residential and non-residential markets also grew by 19% and 50% respectively, y/y.
In 2016, the top 5 states represented 63% of the market22 states installed more than 100
MW, 9 states had more than 1 GW of cumulative PV capacity.
29

energy.gov/sunshot
Source: GTM Research/SEIA : U.S. Solar Market Insight 2016 Year in Review.
U.S. Installation Breakdown
100%
90% 25% 19% 22%
28%
% of Annual U.S. PV Capacity

29%
80% 38% 37%
70% 26% 21%
60%
Additions

27% Remainder
50% 42% 44%
28% Next four states
40% 36%
CA
30% 55% 57%
20% 44%
30% 31% 35%
10% 25%
0%
2010 2011 2012 2013 2014 2015 2016

While California PV installations grew by 56% from 2015 to 2016, the state contributed much
less to total U.S. PV deployment than in the previous three years.
63% of all new solar capacity in 2016 was built in five states; however, this is the smallest
concentration since 2010 when the United States only installed 850 MWDC.
In 2016, five states installed more than the total U.S. did in 2010, and 16 states installed
more than the largest 2010 market (California).

30

energy.gov/sunshot
Source: GTM Research/SEIA : U.S. Solar Market Insight 2016 Year in Review.
Cumulative Solar Change, 20142016
December 2014 December 2016
16.5 GW 34.7 GW

Distrib
Distrib
uted
uted
PV
>15,000 MWAC PV
>1,500 MWAC 38%
38%
>500 MWAC Utility
Utility >100 MWAC PV
PV >15 MWAC 57%
52%
CSP CSP
10% 5%
At the end of 2016, there were more than 100 MW-AC of solar in 28 states (15 states in 2014) and
more than 15 MW-AC in 39 states and DC (32 states and DC in 2014).
More than half of solar capacity is still in two states. 31

energy.gov/sunshot
Source: EIA, Electric Power Monthly (February 2017, February 2015).
U.S. Installation Breakdown
Utility-Scale PV Installed Capacity, Top 10 States, as of Dec. 2016 Distributed PV Installed Capacity, Top 10 States, as of Dec. 2016
Megawatts (MWAC) Megawatts (MWAC)

California 8,520 California 5,360

North Carolina 2,272 New Jersey 1,260
Arizona 1,611 Massachusetts 998
Nevada 1,394 Arizona 908
Georgia 981 New York 733
Utah 847 Maryland 569
Texas 579 Hawaii 443
New Jersey 545 Colorado 287
New Mexico 480 Connecticut 266
Colorado 418 Texas 254
Rest of U.S. 2,124 Rest of U.S. 2,107
0 2,000 4,000 6,000 8,000 10,000 0 1,000 2,000 3,000 4,000 5,000 6,000

At the end of December 2016, there were 33.0 GW-AC of solar systems in the United
States.
Of the 33.0 GW, 19.8 GW were utility-scale PV and 13.2 GW were distributed PV.
As of December 2016, California system capacity represented 42% of all U.S. PV capacity,
leading in both the utility-scale and distributed sectors.
Half of the top 10 states led in both the utility-scale and distributed sectors, while the
other states on the list had less diverse deployment.
32
Source: EIA, Electric Power Monthly, forms EIA-023, EIA-826, and EIA-861 (February 2017).
Note: EIA monthly data for 2016 is not final. Additionally, smaller utilities report information to EIA on a yearly basis, energy.gov/sunshot
and therefore, a certain amount of solar data has not yet been reported.
Leading U.S. Cities
Cumulative PV Installed (MW) PV Per Capita (Watts/Person)
350 600
300 2014
500
250 2015
400
200 2016
300
150
100 200
50 100
0 0

At the end of 2016, the top 10 cities represented 1.6 GW of cumulative PV

capacity, or 4% of total installed U.S. PV capacity.
It is estimated that these cities are only using 3%14% of their technical
potential for rooftop installations.
Seventeen cities had installed more than 50 watts/person at the end of 2016.
Honolulu had installed approximately 0.5 kW per person.

33

energy.gov/sunshot
Source: Shining Cities Harnessing the Benefits of Solar Energy in America. Spring 2017.
Solar Generation as a Percentage of Total
Generation, 2016
14% 13.2%
Solar Generation as a Percentage

12% CSP
DPV
of Total Net Generation

10% 7.9% 7.8% 7.3% UPV

8% 5.8%
6% 4.9%
3.5% 3.0% 2.9% 2.7%
4%
1.4%
2%
0%

Five states produced more than 5% of total net generation from solar in 2016, and an
additional five states produced more than 2.5% of total net generation from solar.
Solar technology contribution varied by state, with Hawaii generating most of its energy
from distributed PV, while North Carolina generated the vast majority of its energy from
utility-scale PV.
During the same time period, CSP generated more than 1% of Californias electricity
and more than 0.5% in Nevada and Arizona.

34
Source: EIA, Electric Power Monthly, forms EIA-023, EIA-826, and EIA-861 (February 2017).
Note: EIA monthly data for 2016 is not final. Additionally, smaller utilities report information to EIA on a yearly basis, energy.gov/sunshot
and therefore, a certain amount of solar data has not yet been reported. Net Generation includes DPV generation.
U.S. Residential PV Penetration
3.0% 1,500,000
Residential PV systems (right axis)

Cum. # of Res. PV Systems

2.5% 1,250,000
% of households with PV

U.S. households (left axis)

Single-family detached houses (left axis)
2.0% 1,000,000

1.5% 750,000

1.0% 500,000

0.5% 250,000

0.0% 0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Since 2005, when the investment tax credit was passed by congress, the residential PV market has
grown by approximately 51% per year, or about 95X.
At the end of 2016, there were over 1.25 million residential PV systems in the United States.
The millionth U.S. residential PV system was likely installed in Q2 2016.
Still, only 1.1% of households own or lease a PV system (or about 1.7% of households living in single-
family detached structures).
However, solar penetration varies by location. Hawaii, California, and Arizona have residential
systems on an estimated 29%, 9%, and 7% of households living in single-family detached structures.
35
Sources. Res. PV Installations: 2000-2009, IREC 2010 Solar Market Trends Report; 2010-2015, SEIA/GTM Solar Market
Insight 2010-16 Year-in-Review. U.S. Households U.S. Census Bureau, 2015 American Housing Survey; state percentages energy.gov/sunshot
based on 2000 survey.
SolarCity, Vivint Solar, and Sunrun
Residential Market Share
3,000
Company estimates
U.S. Residential Installs (MW)

2,500 made in Q1 16 were

higher than actual
2,000 2016 installations Other Installers
1,500 Sunrun
1,000 Vivint
500 SolarCity
0
2013 2014 2015 2016 2016 Company
Guidance
Residential Solar installations have historically been dominated by a few installers.
Flat sales by Vivint Solar and SolarCity/Tesla in 2016 stood in contrast to overall market expansion.
SolarCity (-34%) and Vivint (-15%) significantly underperformed their own guidance for 2016
deployment, which were made in Q1 2016.
With the acquisition of SolarCity by Tesla, the company has emphasized cash preservation over
growth and has shifted from leasing to selling systems.
SolarCity/Tesla and Sunrun are also expanding product offerings through PV+storage.
Tesla announced 98 MWh of energy storage deployed in Q4 2016.
Sunrun announced 20 MWh of orders received for energy PV+storage. Storage and other
advanced technologies add greater value than solar alone and are best addressed with monthly
billing models from a dedicated service provider [Sunrun].
36
Source: Corporate Filing, GTM/SEIA SMI 2016 Year-in-review.
Note: SolarCity Q4 2016 residential deployment and 2016 guidance are assumed to have the same energy.gov/sunshot
percentage of total deployment that occurred in Q3 2016.
Capacity Factor of CSP Projects
50%
Capacity Factor

40% 2014 2015 2016

30%
20%
10%
0%
Jul
Oct
Apr

Oct
Apr
Jul

Oct
Jan

Apr
Jul

Oct
Jan

Apr
Jul

Oct

Oct
Jan

Apr
Jul

Oct
Jan

Apr
Jul
Jan

Apr
Jul

Oct
Jan

Apr
Jul
Jan

Jan
SEGS Nevada S1 Martin Genesis Ivanpah Mojave Solana Tonopah
Month
Plant

In 2016, U.S. CSP plants produced roughly the same energy as in previous years,
given the DNI variability each month and year, with three exceptions:
Mojave produced 41% more energy from May to September 2016 than it did during the
same period in 2015.
Tonopah began producing energy in November 2015 though stopped producing in
October 2016 through the end of the year due to a molten-salt leak.
Martin produced 25% and 36% less in 2016 than in 2015 and 2014 respectively.

37

Source: System AC nameplate capacity is sourced from EIA Form 860. Monthly system electricity production is sourced energy.gov/sunshot
from EIA Form 923.
CSP Market Worldwide
Other
0.1 0.2
1 2 3 4

Spain
2.8
USA China
1.4
2.0
1 2 3 4
Middle East 0.1 0.5
1.8 Morocco 1 2 3 4

1 2 3 4

0.5 0.2 0.2 0.1 0.7

1 2 3 4
India
1 2 3 4

0.2 0.3 0.1

1 2 3 4

S. Africa
Chile Australia
0.2 0.4 0.2 0.1 0.4
1.4 1 2 3 4
1 2 3 4

1 2 3 4 Global

Announced / planning begun 4.8

Permitted 1.7
Financing secured / under
construction 1.5
Commissioned 5.8
38
Source: Bloomberg NEF Power Plant database, accessed 03/22/17. U.S. figures adjusted to include the announced 2 energy.gov/sunshot
GW Nevada project by SolarReserve.
CSP Market Development
Global CSP Installs Global CSP Pipeline
1,500 4.0

Generating Capacity (GW)

Announced / planning
3.0
begun
1,000 2.0
Permitted
1.0
500
0.0 Financing secured /
under construction

U.S.A.
Australia
Chile

Middle East

Other
India
China

Spain
Morocco
0
Commissioned
2007

2008

2009

2010

2011

2012

2013

2014

2015

2016
A little more than 750 MW of CSP was installed globally in 2016.
Between 0.5 GW1.5 GW of annual CSP installations has occurred globally six of the past seven years.
The sustained demand is due to large quantities of CSP deployment in different countries over the years.
China and Chile are the next two countries to push strong levels of CSP deployment. If the projects in their pipeline
are completed they could have comparable markets to Spain and the United States.
China could grow even larger as it has set a solar thermal target of 5 GW by 2020 (but has thus far missed its
CSP targets).
The United States also has a very large pipeline; however, it is made up of one 2 GW project by SolarReserve in
Nevadathe project differs from many other global projects in development in that it has no electricity offtaker.
Continued development around the globe has allowed the technology to continue to drop in price
In Chile, SolarReserve bid its Copiap project with a capacity of 240 MW and 14 hours of thermal energy
storage, at a record-low CSP price of $63/MWh (in part, due to capacity payments it could receive,
highlighting the value of CSP).
SolarReserve announced that its 2 GW Nevada project, will be lower cost than
natural gas power plants, but just as reliable during peak periods. 39

energy.gov/sunshot
Sources: Bloomberg NEF Power Plant database, accessed 03/22/17; CSP Today (09/07/16); Reuters (09/14/16); Utilitydive (10/17/16)
Global Presence of U.S.-based CSP Companies
U.S.-based company Glasspoint uses CSP technology for enhanced oil recovery. It currently has a
1-GW thermal capacity project in Oman scheduled for completion in 2017.
BrightSource, a U.S.- and Israeli-based company, has two major projects using tower and
heliostat CSP technologiesthe 392-MW Ivanpah plant in California, and the 121-MW Ashalim
project under construction in Israel. BrightSource, along with the U.S.-based CSP manufacturer
SkyFuel, are also providing technology for 199 MW of projects being developed in China.
The U.S.-based developer SolarReserve, which focuses on tower and heliostat plants using
molten-salt technology, currently has one commissioned plantthe 125 MW Tonopah plant in
Nevada. They also are pursuing prospects in South Africa, Chile, and a 2 GW project in the United
States, which have thus far not received financing or a PPA.

40

energy.gov/sunshot
Sources: Bloomberg NEF Solar Thermal Market Outlook. January 20, 2017.
Agenda

State and Federal Updates

Global Market Updates
U.S. Deployment
U.S. Pricing
Global Manufacturing
Component Pricing
Market Activity

41

energy.gov/sunshot
System Pricing from Select States
2.5 kW10 kW
$8 $8
$7 $7
System Price ($/W-DC)

$6 $6
$5 $5
$4 $4
$3 $3
$2 $2
$1 *Bars reflective of the state with the median, 20t,h and 80th percentile weighted average reported $1
system price. Select states include Arizona, California, Massachusetts, Maryland, and New York.
$0 $0
H1 '10 H2 '10 H1 '11 H2 '11 H1 '12 H2 '12 H1 '13 H2 '13 H1 '14 H2 '14 H1 '15 H2 '15 H1 '16 H2 '16
Median System Price 80th Percentile 20th Percentile

In 2016, the median reported system prices fell 4%, and the price range
contracted.
System prices fell, on average, 1.7% between H1 2016 and H2 2016.
Lowest prices (20th percentile) were seen in Arizona ($2.96/W), while higher
prices (80th percentile) were seen in Maryland ($5.04/W) in H2 2016.
2016 MW: AZ (82); CA (387); MA HO (79); MA 3-P (35); MD (2); NY H.O (37); NY 3rd-P (59).
Note: MA does not report whether a system is third-party owned. Therefore, it was estimated using the
applicant entity or installer for the following organizations: SolarCity, CPF Capital, Sunrun, Vivint, and 42
Sungevity.
Sources: CA NEM database; MA SREC program; Arizona Public Services and Salt River Project; MD Energy energy.gov/sunshot
Administration; NY PV Incentive Program. All programs accessed 4/4/17
SolarCity, Vivint Solar, and Sunrun Cost & Value
$5.0 $5.0
$4.5 $4.5

Installed Cost ($/W-DC)

$4.0 $4.0 $1.00
$3.5 $3.5
$0.28
$3.0
$/Watt-DC

$3.0 $0.40 $0.58 Net Value

$2.5 $2.5 $0.62
Vivint - Installation, SG&A G&A
$2.0 $2.0
SolarCity - Installation, SG&A
$1.5 Sales
$1.5 Sunrun - Installation, SG&A $2.55
SolarCity - Net Value $1.0 $2.06 $2.04 Installation
$1.0
Sunrun - Net Value $0.5
$0.5
$0.0
$0.0
Vivint Solar Sunrun Avg. Sunrun Built
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
'12 '13 '13 '13 '13 '14 '14 '14 '14 '15 '15 '15 '15 '16 '16 '16 '16 Q4 2016

From Q4 15 to Q4 16, Vivint Solar and Sunrun systems total costs decreased 1% and 8%
respectively.
Installation costs for both companies decreased 12% y/y; however, overhead costs have been
burdened by lower than expected total installs.
Sunrun reported a profit (or net value) of $1/W in Q4 2016; however, $0.60/W of that comes from
assumed contract renewals.
With Teslas acquisition of SolarCity there is less transparency of their costs.
43

energy.gov/sunshot
Sources: Corporate Filings.
System Costs Reported by EnergySage
From H2 2015 to H2 2016, EnergySage reported a 9% reduction in the average gross costs of a
residential system.
The standard deviation of PV system quotes in H2 2016 was $0.48/W.
EnergySage quotes also reported an average system payback period of 7-8 years.
Residential system quotes varied by state. In H2 2016, the average gross cost of a residential system
in New York was 21% higher than the average gross cost of a residential system in Arizona.

Residential PV system cost over time Residential PV cost by state, H2 2016

$5 $5
Average Gross Costs ($/W)

Average Gross Costs ($/W)

$3.86 $3.79 $3.69
$4 $3.57 $4 $3.6 $3.6
$3.36
$3.1 $3.2 $3.3 $3.4 $3.4
$3.0 $3.0 $3.0 $3.0
$3 $3

$2 $2

$1 $1

$0 $0
H2 2014 H1 2015 H2 2015 H1 2016 H2 2016 AZ OH VA FL MD TX IL U.S. CA MA NY

44

energy.gov/sunshot
Sources: EnergySage Solar Market place Intel Report H1 2016 H2 2016
NREL Study Find Pricing Differences Between Large
and Small Installers

A recent NREL study matched over 1,500 price quotes for residential PV systems from 2014 to 2016
and found that quotes from large installers were $0.33 higher than non-large installers (10%).
Large installers tended to quote smaller systems with a greater use of micro-inverters;
adjusting for these factors NREL still found a $0.21/W difference in price.
The study also found that the range of price quotes from small installers tended to be
narrower than that of larger installers ($1.61/W span between the 10th and 90th percentile
quotes for larger installers; $1.25/W for small installers).
The results of the report suggests, that some residential PV customers may forego lower prices for
the opportunity to work with a large installer [e.g., known-brand, better warranty, and inverter
replacement terms] but also that customers could benefit from obtaining more quotes before
deciding to install a system. 45

Source: Eric OShaughnessy and Robert Margolis. Using Residential Solar PV Quote Data to Analyze the energy.gov/sunshot
Relationship between Installer Pricing and Firm Size. NREL. April 2017.
System Pricing from Select States
10 kW100 kW
$8 $8
$7 $7
System Price ($/W-DC)

$6 $6
$5 $5
$4 $4
$3 $3
$2 $2
$1 $1
*Bars reflective of the state with the median, 20th, and 80th percentile weighted average reported system
$0 price. Select states include: Arizona, California, Massachusetts, Maryland, and New York. $0
H1 '10 H2 '10 H1 '11 H2 '11 H1 '12 H2 '12 H1 '13 H2 '13 H1 '14 H2 '14 H1 '15 H2 '15 H1 '16 H2 '16
Median System Price 20th Percentile 80th Percentile

Reported host-owned system prices for systems 10 kW100 kW fell 3% between H1 and H2 2016.
Third-party systems also fell by 7% during that timeframe.
Third-party systems are being reported, on average, $1/W$2/W more expensive than host-
owned systems. Third-party owners may use different methodologies to determine a price.
Lowest prices (20th percentile) were seen in Arizona ($2.82/W), while highest (80th percentile) were
seen in Massachusetts ($5.04/W) for third-party-owned systems.
2016 MW: AZ (54); CA (126); MA HO (47); MA 3-P (17); MD (3); NY H.O (36); NY 3rd-P (32).
Note: MA does not report whether a system is third-party owned. Therefore, it was estimated using the applicant 46
entity or installer for the following organizations: SolarCity, CPF Capital, Sunrun, Vivint, and Sungevity.
Sources: CA NEM database; MA SREC Program; Arizona Public Services and Salt River Project; MD Energy energy.gov/sunshot
Administration; NY PV Incentive Program. All programs accessed 4/4/17.
Average System Pricing by Size and State
100 kW500 kW and 500 kW2 MW
100 kW - 500 kW 500 kW - 2 MW
$8 $8
CA, Host-owned
$7
Avg. System Price (Nominal $/WDC)

Avg. System Price (Nominal $/WDC)

$7 CA, 3rd-party

$6 MA, Host-owned
$6

$5 $5

$4 CA, Host- $4
owned
CA, 3rd-party
$3 $3
MA, Host-
owned
$2 $2
2009 2010 2011 2012 2013 2014 2015 2016 2010 2011 2012 2013 2014 2015 2016

Systems sized 100 KW 500 KW see flat pricing on average with slight increases in New York
and California.
Prices for systems 500 KW 2 MW fell 11% between 2015 and 2016, largely driven by
dramatic drop in price in California.
47
2016 MW: (100500 kW): CA H.O. (98); MA H.O.(29); NY (26). (500 kW2 MW): CA H.O. (70); MA H.O.(87). energy.gov/sunshot
Sources: CA NEM database; MA SREC program; NY PV incentive program. All programs accessed 4/4/17.
Utility-owned PV Pricing (>5 MW)
$8
System Price (2016 $/W)

$7 Projects, W-DC
$6 $5.90 Capacity-Weighted Average Price, W-DC
$5.46
$5 Capacity-Weighted Average Price, W-AC
$4
$3.58
$3 $2.98 $3.03
$2 $2.29
$1.69
$1 $1.32
$0
2009 2010 2011 2012 2013 2014 2015 2016
In the above system price data set for nine regulated utilities the capacity weighted average price of a utility-owned PV system fell 78%
to $1.32/WDC ($1.95/WAC) between 2009 and 2016.
The capacity weighted average system price fell 22% from 2015 to 2016
From 2015 to 2016 PV system prices in Watts-AC fell slower than they did in Watts-DC because of an increase in inverter loading ratio,
from roughly 1.3 to 1.5.
With cheaper modules, it is may be more economical to add more modules per inverter.
The majority of utility-scale systems are owned by IPPs, which have PPAs with utilities. PPA pricing, while not in lock-step with system
pricing, generally followed the same trends.
From 2010 to 2016 the generation-weighted average PPA price for utility-scale systems placed in service in that year fell 64%;
from 2015 to 2016 PPA prices dropped 33% for systems placed in service in that year.
Systems should have much lower PPA pricing in the near future. as the average price for a PPA signed in 2015 was around
$40/MWh, or 30% lower than PPAs for systems installed in 2016.
Note: data sample consists of 42 projects with 1.2 GWDC of capacity
Sources: FERC Form 1 Filings from the following utilities: Arizona Public Service; Florida Power & Light;
Duke Energy Progressive; Georgia Power; Indiana Michigan Power Company; Kentucky Utilities; Pacific Gas
48
& Electric; Public Service of New Mexico; Southern California Edison. PPA pricing from Utility-Scale Solar energy.gov/sunshot
2015 (Bolinger and Seel 2016).
Agenda

State and Federal Updates

Global Market Updates
U.S. Deployment
U.S. Pricing
Global Manufacturing
Component Pricing
Market Activity

49

energy.gov/sunshot
Global Annual PV Shipments by Region*
80
Global Shipments by Region PV Technology Share of
70 Shipments, 2016
CIGS a-Si
U.S. CdTe 1% 0.1%
60

PV Module Shipments (GW)

India 4%
Thailand
50
Singapore
Philippines
Europe 40
Vietnam
Japan 30 Mono
c-Si Multi c-
S. Korea
41% Si
Malaysia 54%
20
Taiwan
China
10

0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

In 2016, global shipments increased 37% y/y and 22X in the past 10 years.
China & Taiwan manufactured 66% of shipments in 2016; Asia countries manufactured ~96%.
Ten countries shipped over 1 GW of PV in 2016.
95% of shipments in 2016 came from crystalline technology, 4% CdTe (First Solar, etc.), 1% CIGS
(Solar Frontier, etc.). 50
*Note: Excludes inventory sales and outsourcing.
Source: 2007-2016: Paula Mints. "Photovoltaic Manufacturer Capacity, Shipments, Price & Revenues 2016/2017." SPV Market energy.gov/sunshot
Research. Report SPV-Supply7. April 2017.
PV Mfgs. % of Sales Revenue by Region, 2016
100%
90% Other
80%
Europe
70%
% of Revenue

60% India
50%
Japan
40%
30% China
20%
United States
10%
0%
First Solar SunPower ReneSolar JA Solar Jinko Solar Canadian Hanwha Q
Solar Cells
PV manufacturers have varying degrees of regional exposure.
The majority of revenue from First Solar and SunPower came from the United States with
virtually no penetration in the Chinese market.
Many of the publicly traded Chinese companies have large revenues from their domestic
market, but are less dependent on their home market than U.S. firms.
Note: not all companies separate revenue into each geographic location represented in graphic. In those instances, all
non-separated numbers are classified in other unless otherwise stated. Canadian Solar and Hanwha Q Cells have
not filed their annual reports yet so 2015 numbers are reflected. U.S. numbers for Jinko Solar represent revenues the 51
company received from all of America as U.S. was not broken out separately. Renesolas figures are as a weighted
averaged of reported quarterly figures. energy.gov/sunshot
Sources: Company figures based on Q4 16 (and previous) SEC filings by the respective companies.
Global Leading PV Manufacturers, by Shipments
2016 2015 2010 2005
Rank Manufacturer Shipments Manufacturer Shipments Manufacturer Shipments Manufacturer Shipments
(2016) (GW) (2015) (GW) (2010) (GW) (2005) (GW)

1 Trina 5.0 Trina 3.6 Suntech 1.6 Sharp 0.375

2 JA Solar 4.9 JA Solar 3.6 JA Solar 1.5 Kyocera 0.142
3 Hanwha 4.0 Hanwha 3.4 First Solar 1.4 Q-Cells 0.131

4 Jinko Solar 3.9 Canadian Solar 2.7 Yingli 1.1 Schott Solar 0.095

5 Motech 2.9 First Solar 2.5 Q-Cells 1.0 BP Solar 0.086

6 First Solar 2.7 JinkoSolar 2.4 Sharp 0.9 Mitsubishi 0.085

7 Longi Lerri 2.7 Yingli 2.4 Trina 0.9 Sanyo 0.084

8 Canadian Solar 2.4 Motech 2.1 Motech 0.9 Shell Solar 0.055
9 Yingli 2.4 Neosolar 2.1 Gintech 0.8 Motech 0.045

10 Shunfeng- 2.2 Shunfeng- 2.0 Kyocera 0.6 Isofoton 0.039

Suntech Suntech

Other 36.4 26.8 6.8 0.270

Total 69.5 50.9 17.4 1.410

Sources: Paula Mints. "Photovoltaic Manufacturer Capacity, Shipments, Price & Revenues 2016/2017." SPV Market 52
Research. Report SPV-Supply7. April 2017. "Photovoltaic Manufacturer Capacity, Shipments, Price & Revenues
2015/2016." SPV Market Research. Report SPV-Supply3. April 2016. Navigant "Photovoltaic manufacturer Shipments, energy.gov/sunshot
Capacity & Competitive Analysis" (April 2009).
Manufacturers Shipments
Publically Traded Cell/Module Manufacturers
35
ReneSola
SunPower
30 Hanwha Q Cells
Jinko Solar 1.4
Canadian Solar 1.3
25 Yingli
GW Shipped Per Company

4.6
JA Solar 1.6
First Solar 1.2
20 3.0 6.7
2.0
1.3 4.5
15
1.7 1.5
1.4 2.8 5.2
0.7 1.3 4.7
10 0.9 1.9 2.8 2.2
0.8
0.3 1.2 1.9 2.4
0.2
1.2 1.5 3.4
5 1.1 3.2 5.2
2.3 4.0
1.6 3.1
0.6 1.7 2.1
0
1.4
0.8 1.9 1.6 2.2 2.5 3.1

In 2016, the above leading companies shipped 29 GW, 20% more than in 2015.
In Q4 16, the above companies recorded 7.3 GW of shipments, a 9.5% increase over Q3 16.
Jinko reported the largest shipments to lead with 6.7 GW shipped in 2016.
53
Note: First Solar reports production, not shipments. Only ReneSola modules represented. For 2016, Hanwha Q Cells
quarterly shipments based on total year reporting. energy.gov/sunshot
Sources: Company figures based on Q4 16 (and previous) SEC filings by the respective companies.
PV Manufacturers Margins
40%

30%

20%

10%

0%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
-10% '10 '10 '10 '10 '11 '11 '11 '11 '12 '12 '12 '12 '13 '13 '13 '13 '14 '14 '14 '14 '15 '15 '15 '15 '16 '16 '16 '16
-20%
Operating Margin
-30%
Gross Margin
-40%
*Line represents the median, with error bars representing 80th and 20th percentiles for the following companies: Canadian Solar, First Solar, Hanwha Q
Cells, JA Solar, Jinko Solar, ReneSola, SunPower, Trina Solar, and Yingli Solar.
Industry margins declined from Q3Q4 2016, with some variation among individual companies.
The median gross margins was 8% and the median operating margin was -2% for the above companies in Q4
2016.
Jinko saw the strongest gross margins in the industry (14%) and the most shipments; SunPower had the lowest gross
margin of the surveyed companies at -3% in Q4 2016 and the fewest shipments.
Most Asian manufacturers saw gross margins of 7%13% in Q4 2016.
First Solar saw a dramatic drop in margin due to the one time restructuring of assets related to Series 5/Series 6
module development.
All manufacturers saw drops in margins from Q3 2016 Q4 2016, consistent with reports of declining module costs.
54

energy.gov/sunshot
Sources: Company figures based on Q4 2016 (and previous) SEC filings by the respective companies .
Debt Load of Manufacturers
Operating Income ($) / Interest Expense ($) Cash ($) / Interest Expense ($)
10
10 10 9 9
8
6 8 7 7 7 7
33 4 4 44
4 2 1 0.7 0.7
2 74 15 0.2 6
0
(2) (0.3) (24)
(0.4) (10) 4 3
(0.5) 3
(4) (2) 2
(6) 2 1 1
(4) (5) (4) (5) 1 1 1
(8) 0 16266 22 18
(10) (8) 0

2015 2016 2016R 2010 2011 2015 2016 2010 2011

Manufacturers show differing abilities to service their debts.

In 2016, the above manufacturers had a median interest coverage ratio (relationship between operating profits,
and interest expenses) of 1.37.
An interest coverage ratio below 1 means that a companys earnings were not sufficient to make payments
on debt, and a company may have to draw from cash reserves to service loans.
Many western companies have historically had higher cash-to-debt levels, and so could afford to draw upon cash.
First Solar and SunPower were able to incur restructuring charges in 2016 of $819 million and $207 million
respectively, and were still able to service their debt.
Excluding the restructuring charges these companies would have healthier coverage ratios.
Yinglis debt and cash levels are improving and doing better than historical levels achieved by bankrupt
companies, such as Suntech and Q-Cells. That said, they will be challenged by a downturn in margins as well as
finding the cash to make restructuring improvements to better compete. 55

2016R represents the ratio excluding restructuring charges energy.gov/sunshot

Sources: Corporate Filings (Q4 16)
 Gross Margin Across Supply Chain
100%

80%

60%
Median Gross Margin of Surveyed

40%

20%
Companies

0%
'10'11'12'13'14'15'16'10'11'12'13'14'15'16'10'11'12'13'14'15'16'10'11'12'13'14'15'16'10'11'12'13'14'15'16'10'11'12'13'14'15'16'10'11'12'13'14'15'16
-20%
Polysilicon Wafers Cells/Modules Equipment Inverters Integrators IPP/YieldCo
-40%

-60%

-80%

-100%

Gross margins generally dropped in 2016 though there was still substantial variation among individual companies.
Yieldcos continue to get higher margins than other sectors of the supply chain, however their margins, on average, also
dipped significantly in 2016, and had substantial variation.
There was a wide variation in profitability for integrators.
Sources: Company figures based on Q4 16 (and previous) SEC filings by the respective companies. Error bars represent high and low
values of surveyed companies. Companies surveyed are: Wafers - LDK Solar, ReneSola, SAS Wafers, Wafer Works Corp., Solargiga; 56
Poly - GCL-Poly, REC Silicon, Wacker, LDK Solar; Cells/Modules, Gintech ,Motech, First Solar, JA Solar, Yingli, Trina Solar, Canadian, PV
Crystalox Solar ,Hanwha SolarOne, Jinko Solar, SunPower, LDK Solar; Integrators - Real Goods Solar, SolarCity, Vivint, SunEdison;
energy.gov/sunshot
Inverters - Power-One, SMA, Satcon, Enphase Energy, Advanced Energy Industries; IPP/Yieldco - Abengoa Yield, NRG Yield, NextEra
Energy Partners, Northland Power Inc., Pattern Energy, Terraform Power, Sky Solar Holdings.
 Operating Margin Across Supply Chain
100%

80%
Median Operating Margin of Surveyed Companies

60%

40%

20%

0%
'10 '11 '12 '13 '14 '15 '16 '10 '11 '12 '13 '14 '15 '16 '10 '11 '12 '13 '14 '15 '16 '10 '11 '12 '13 '14 '15 '16 '10 '11 '12 '13 '14 '15 '16 '10 '11 '12 '13 '14 '15 '16 '10 '11 '12 '13 '14 '15 '16
-20% Polysilicon Wafers Cells/Modules Equipment Inverters Integrators IPP/YieldCo

-40%

-60%

-80%

-100%

There was a wide variation in operating margins as companies try to gain market share and pursue new strategies.
There was substantial variation across the supply chain as integrators sacrifice short term profits to scale rapidly.
Operating margin is not necessarily an indicator of corporate profitability, though with strong margins companies
should eventually figure a way to profitability.
Sources: Company figures based on Q4 16 (and previous) SEC filings and Annual Reports by the respective companies. Error bars
represent high and low values of surveyed companies. Companies surveyed are: Wafers - LDK Solar, ReneSola, SAS Wafers, Wafer 57
Works Corp., PV Crystalox, Solargiga; Poly - GCL-Poly, REC Silicon, Wacker, LDK Solar; Cells/Modules, Gintech ,Motech, First Solar, JA
Solar, Yingli, Trina Solar, Canadian Solar ,Hanwha SolarOne, Jinko Solar, SunPower, LDK Solar; Integrators - Real Goods Solar, SolarCity,
energy.gov/sunshot
Vivint, SunEdison; Inverters - Power-One, SMA, Satcon, Enphase Energy, Advanced Energy Industries; IPP/Yieldco - Abengoa Yield, NRG
Yield, NextEra Energy Partners, Northland Power Inc., Pattern Energy, Terraform Power, Sky Solar Holdings.
 Profit vs. Manufacturing Capacity Additions
Poly Wafers Cells Modules
90% 100 50% 25 20% 25 30% 25

Capacity Additions (000 MT)

Capacity Additions (GW)

Capacity Additions (GW)

80 40% 20 20 25% 20
70% 15%

Capacity Additions (GW)

Gross Margins

Gross Margins
20%
Gross Margins

60
50% 30% 15 15 15

Gross Margins
10% 15%
40
20% 10 10 10
30% 10%
20 5%
10% 5 5 5% 5
10% 0
0% 0 0% 0 0% 0
2010
2011
2012
2013
2014
2015
2016

-10% -20

2010
2011
2012
2013
2014
2015
2016

2010
2011
2012
2013
2014
2015
2016
2010
2011
2012
2013
2014
2015
2016
Average Poly Mfg. Gross Margins -10% -5 Average Cell Mfg. Gross Margins
Average Wafer Mfg. Gross Margins Average Module Mfg. Gross Margins
Global Poly Mfg. Capacity Additions Global Wafer Mfg. Capacity Additions Global Cell Mfg. Capacity Additions Global Module Mfg. Capacity Additions

Manufacturing capacity additions slumped in 20122013 following the slump in gross

margins across the supply chain but rose again following the increase in margins.
Margins started to fall again in 2016; while capacity additions generally rose in 2016,
they significantly dropped Q/Q toward the end of the year.

58

energy.gov/sunshot
Sources: IHS PV Integrated Market Tracker Q4 2016. December 23 2016.
Research & Development
R&D Expenditures R&D as a Portion of Revenue
6%
$160
$140 5%
Annual R&D Expenditures

$120
4%
$100
(Millions)

$80 3%
$60 2%
$40
1%
$20
$0 0%
2010 2011 2012 2013 2014 2015 2016 2010 2011 2012 2013 2014 2015 2016
First Solar JA Solar Yingli First Solar JA Solar Yingli
Trina Solar Canadian Solar Hanwha Q Cells Trina Solar Canadian Solar Hanwha Q Cells
Jinko Solar SunPower Jinko Solar SunPower

In 2016, these companies spent over $380 million on R&D, down 5% YoY.
First Solar continues to lead in R&D spending, though SunPower has been increasing its R&D
expenditures annually.
The majority of Chinese manufacturers are providing lower but relatively consistent levels of funding
to research.
Yingli significantly cut its R&D budget as it endeavors to avoid bankruptcy. 59

energy.gov/sunshot
Sources: Company figures based on Q4 2016 (and previous) SEC filings by the respective companies.
PV Efficiency Improvements
35%

30% ShockleyQueisser limit

29.4%
Mono (WR)
25% 25.0% 25.3%
22.6%
Conversion Efficiency

22.1%
20.4% Multi (WR) 21.9%
20% 19.9%
CdTe (WR) CIGS (WR)
16.7% 16.6%
Yingli Multi Best 16.4%
15% 14.40% First Solar Module (Avg.)
13.0%
11.0% Solar Frontier Module
10% (Avg.)
9.2%

5%

0%
2009 2010 2011 2012 2013 2014 2015 2016

Most technologies saw slight increases in efficiency in 2016.

CIGS/CdTe now have similar WR efficiencies to multi c-Si and average-efficiency CdTe modules are
closing the gap.
A key question is whether CIGS/CdTe will be able to close the gap with mono c-Si world records or
if there are structural barriers preventing this from occurring.
60

energy.gov/sunshot
Sources: Corporate press releases and public filings, NREL World Records.
U.S. Manufacturing
1,200 1,109
Q4
1,000
U.S. Production (MW)

Q3 836
776 779 751
800 Q2
595 611 628 617
Q1
521 544 569 590
600 509 487 481
398 446 403
371
400 300 282
181
200 116 92
22 24 0
0
2010
2011
2012
2013
2014
2015
2016
2010
2011
2012
2013
2014
2015
2016
2010
2011
2012
2013
2014
2015
2016
2010
2011
2012
2013
2014
2015
2016
Wafer Cell Module, c-Si Module, thin-film

U.S. module and cell production increased again in 2016, growing y/y 29% and 24% respectively.
U.S. tariffs on Chinese modules and cells, and a growing U.S. market, contributed to
increased production levels.
In 2016, module production was split 65% c-Si, 24%, CdTe, and 11% CIGS.
Wafer production halted in the United States in 2016 as SunEdison consolidated its R&D
facilities; however, wafer production in the U.S. effectively ended a few years ago.

61

energy.gov/sunshot
Source: GTM Research & SEIA. U.S. Solar Market Insight: Q4 2016.
U.S. Module Manufacturing vs. U.S. Deployment
2.5 250%
U.S. Manufacturing Capacity (GW)

2.0 200%

1.5 150%

1.0 100%

0.5 50%

0.0 0%
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
U.S. thin-film module production U.S. c-Si module production
excess mfg. capacity U.S. module mfg. as a % of U.S. installations

Pre- 2011, the United States was a net-exporter of PV modules; in 2016 U.S. module production
surpassed its previous peak from 2011; however, the U.S. domestic deployment market has
increased by a factor of 16.3 since 2010.
U.S. manufacturing represented 12% of U.S. deployment in 2016.

62

energy.gov/sunshot
Source: GTM Research & SEIA. U.S. Solar Market Insight: Q4 2016.
U.S. Polysilicon Manufacturing
80
70 Excess capacity
60 Production
U.S. Poly (000's MT)

50
40
30
20
10
0
2010 2011 2012 2013 2014 2015 2016

From 2010 to 2014, U.S. polysilicon production was relatively flat; however, Chinas antidumping
tariffs, which were effectively implemented in August 2014, appear to be having an effect on
U.S. polysilicon manufacturing.
Poly utilization rate was down from 86% in 2014 to 43% in 2016.

63

energy.gov/sunshot
Source: GTM Research & SEIA. U.S. Solar Market Insight: Q4 2016.
Estimated U.S. Manufacturing Revenue
$7 6.4 6.4
Inverters
$6 5.3 Module
U.S. Mfg. Revenue ($B)

$5 Cell
4.3
Wafer
$4
Polysilicon
$3 2.4 2.6 2.4
2.2 2.3 2.2
$2

$1

$0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

In 2016, estimated U.S. PV & inverter revenue was $2.2B, fairly flat since 2012 but down 65% from 10.
Poly revenue decreased 55% from 2014 to 2016 due to a 36% decrease in production and 29%
decrease in price.
Module and inverter revenues were flat y/y as the increase in production was counteracted by the
decreased in price.
Modules, inverters and polysilicon were 40%, 30%, and 20% of U.S. revenue, respectively.

Note: measured by U.S. production x average component price

Sources: production of wafer/cell/module 2007-11: GTM "Wafer Cell Module Database 2012". June 2012. Polysilicon 64
2007-11: IEA, U.S. NSR, 2007-2011. Wafer/cell/module/poly 2012-5 (production and price) : GTM/SEIA U.S. Solar
Market Insight Q4 15 (March 16). Price, 2007-11: Photon Consulting, "Solar Annual 2012" & "Solar Annual 2009; energy.gov/sunshot
2014 production and price: GTM/SEIA U.S. Solar Market Insight 2015 Year-in-Review (March 16).
Agenda

State and Federal Updates

Global Market Updates
U.S. Deployment
U.S. Pricing
Global Manufacturing
Component Pricing
Market Activity

65

energy.gov/sunshot
PV Manufacturers Cost
$1.80 First Solar Canadian Solar
$1.60 Jinko Solar

$1.40

$1.20

$1.00

$0.80

$0.60

$0.40

$0.20

$0.00
Q4 '10 Q4 '11 Q4 '12 Q4 '13 Q4 '14 Q4 '15 Q4 '16

In Q4 16 module costs were between $0.33/W and $0.35/W.

Q4 16 costs from the above companies were, on average, 15% less than Q4 15, though
these three companies may not be representative of the industry as a whole.

66

Sources: Company figures based on Q4 16(and previous) SEC filings by the respective companies. Deutsche Bank energy.gov/sunshot
(12/17/15 (4/26/16) (3/31/17).
Module, Cell, Wafer, and Polysilicon Price
Polysilicon Spot (right axis) c-Si Avg. (left axis) Multi Wafers (left axis) Multi Cells (left axis)
$1.00 $20

$0.75 $15
$/Watt (Nominal)

Polysilicon $/kg
$0.50 $10

$0.25 $5

$0.00 $0
Jan-16 Mar-16 Jun-16 Sep-16 Dec-16 Feb-17
Module and component prices continued to decline in the first quarter of 2017 after rapid
declines in 2016.
BNEF reports Q1 2017 price reductions. Q/Q, for modules (18%), cell (4%), wafer (8%), and
poly (4%).
From Q1 2016 to Q1 2017 BNEF reports price reductions for modules (25%), cell (23%), and
wafers (43%), but an increase of poly prices by 3%.
Despite the general consensus of a lower-priced environment, there are a range of reported
market prices, due in part to geographic differences, variations in order size and the difference
between delivered prices versus booked prices. 67
Note: Error bars represent high and low quotes Module pricing reflects orders of approximately 1 MW; bigger orders
are more likely to receive favorable pricing . energy.gov/sunshot
Source: BNEF Solar Spot Price Index (04/07/17).
Different Estimates of Module ASP
$0.80
$0.70
$0.60
$/Watt (Nominal)

$0.50
$0.40
$0.30 BNEF GTM Research
$0.20 PVXchange PVinsights
$0.10 IHS
$0.00
Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17

Estimates of module ASP vary be source; as of March 2017, most estimates quote module ASP
as $0.35/W or $0.50/W.
PVXchange only reports European markets data, which currently has a module price-floor
agreement in place with many Chinese companies (price floor currently ~$0.49/W)
BNEF explicitly tracks smaller orders, approximately 1 MW in size, in their spot pricing
index; their estimate of larger orders, above 10 MW, is consistent with the lower estimated
prices.
Upper end pricing may reflect higher-priced markets or products, or smaller buyers.
68

Sources: BNEF Solar Spot Price Index (04/07/17); GTM Research (February 2017, April 2017); IHS Technology energy.gov/sunshot
(December 2016); PVInsights (04/07/17); PVXchange (04/07/17); Mercom (01/26/17) .
Experience Curve
100
Historic ASP
Module ASP (2016$/W) Q1 2017 ASP

10

0.1
0 1 10 100 1,000 10,000 100,000 1,000,000 10,000,000
Cumulative Global Shipments (MW)

This experience curve displays the relationship, in logarithmic form, between the average selling
price of a PV module and the cumulative global shipments of PV modules. As shown, for every
doubling of cumulative PV shipments there is on average a corresponding ~21% reduction in PV
module price.
Since 2012, module ASP has been below the historical experience curve, which would have
extrapolated that the industry would have needed to produce 2.8 TW of panels to get to Q1 2017
module ASPthe industry has produced 250 GW 300 GW.
Sources: For 2001-2016: Paula Mints. "Photovoltaic Manufacturer Capacity, Shipments, Price & Revenues 2016/2017." SPV Market
Research. Report SPV-Supply5. April 2017. For 1999-2000: Paula Mints. "Photovoltaic Manufacturer Capacity, Shipments, Price &
Revenues 2014/2015." SPV Market Research. Report SPV-Supply3. April 2015. For 1984-1998: Navigant Consulting (2010),
Photovoltaic Manufacturer Shipments, Capacity & Competitive Analysis 2009/2010, Report NPS-Supply5 (April 2010). For 1980- 69
1984: Navigant Consulting (2006), Photovoltaic Manufacturer Shipments 2005/2006, Report NPS-Supply1 (August 2006). For 1976-
1980: Strategies Unlimited (2003), Photovoltaic Manufacture Shipments and Profiles, 2001-2003, Report SUMPM 53 (September energy.gov/sunshot
2003).
Inverter Pricing
Residential Commercial Utility
Factory Gate Price ($/W-AC)

$0.6
$0.5
$0.4
$0.3
$0.2
$0.16
$0.1 $0.11
$0.06
$0.0
Q4 '10 Q4 '11 Q4 '12 Q4 '13 Q4 '14 Q4 '15 Q4 '16

Since Q4 10, inverter prices have fallen by 63%74%.

From Q4 15 to Q4 16 inverter prices dropped 11%25%.

70

energy.gov/sunshot
Source: GTM/SEIA Solar Market Insight 2016 Year-in-review.
Enphase Microinverters and SolarEdge
DC-Optimized Inverter Systems
$0.8 Enphase
3.0 4.5%
SolarEdge
$0.7 4.0%
% of global inverter shipments
2.5
$0.6 3.5%

% of Global Shipments
$0.5 2.0 3.0%
ASP ($/W-AC)

GW Shipped
$0.47
2.5%
$0.4 $0.38 1.5
2.0%
$0.3
$0.27 1.0 1.5%
$0.2 Enphase (Rev./W)
$0.18 1.0%
Enphase (Cost/W) 0.5
$0.1 SolarEdge (Rev./W) 0.5%
SolarEdge (Cost/W)
$0.0 0.0 0.0%
Q4 '11 Q4 '12 Q4 '13 Q4 '14 Q4 '15 Q4 '16 2012 2013 2014 2015 2016

From Q4 15 to Q4 16 Enphase inverter and SolarEdge optimizer prices fell 8% and 10% respectively.
SolarEdge costs also decreased by 23% while Enphase costs have been flat for two years.
SolarEdge shipped 1.7 GW in 201623% growth y/y; Enphase shipped 0.7 GW in 2016up 3% y/y.
SolarEdge and Enphase shipments have increased from approximately 1.7% of total global
shipments in 2012 to 3.9% in 2016.

71

energy.gov/sunshot
Sources: Enphase/SolarEdge public filings. Global inverter shipments from GTM Research.
Agenda

State and Federal Updates

Long-term Solar Projections
U.S. Deployment
U.S. Pricing
Global Manufacturing
Component Pricing
Market Activity

72

energy.gov/sunshot
SREC Markets
$700 $600 NJ PA
NJ PA MD DC
$600 MD DC
DE MA $500 MA OH In-state
Auction Price Per SREC

Auction Price Per SREC

OH In-state OH Out-State
$500
$400
$400
$300
$300

$200 $200

$100
$100
$0
$0
Aug-09
Feb-10
Aug-10
Feb-11
Aug-11
Feb-12
Aug-12
Feb-13
Aug-13
Feb-14
Aug-14
Feb-15
Aug-15
Feb-16
Aug-16
Feb-17

Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17

SREC prices saw dramatic changes in some markets and stability in others.
Ohio, Pennsylvania and Maryland saw drops in SREC value in 2016.
The value of MD SRECS decreased 93% from January 2016 to April 2017, as the state
approached its RPS cap; the state raised its RPS cap in February 2017, which should place
upward pressure on SRECs, as the cap increased.
73

energy.gov/sunshot
Source: Blog, SRECTrade, www.srectrade.com (accessed April 14, 2017); Utility Dive (February 3, 2017)
Market Activity
Solar stocks saw significant losses in 2016, but began to track more closely to the broader market in
Q1 2017.
TAN was 2% in Q1 2017, after seeing large losses in 2016.
S&P 500 was 4.5%, Russell 2000 was flat, over the same time period.
40%
S&P 500 Index
30% Russell 2000
Guggenheim Solar ETF (TAN)
20%
% Change (Index: 1/4/16 Adjusted Close)

10%

0%

-10%

-20%

-30%

-40%

-50%
Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17

74

Notes: Average market cap. of securities in TAN was $9.8 Billion (12/31/16), Russell 2000, $1.6b (6/27/16). energy.gov/sunshot
Sources: Stock Market: YahooFinance (04/4/17).
U.S. Solar Workforce
Historical Projection
350
Other* 286
300 260
Project Development
# of Workers (000s)

250 Sales & Distribution 209

34
200 Manufacturing 174
143 32
Installation 38
150 119
94 100
100
38 45 137
50 18 25
0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017P

As of January 2017, the U.S. solar industry employed 260,000 workers, adding 51,000 jobs in 2016.
This represents the fourth straight year of 20%+ workforce growth.
Installations jobs represented 53% of total U.S. solar jobs in 2016; however, other areas had higher
growth rates. For example, manufacturing jobs grew 26% y/y to over 38,000 and are expected to
grow again in 2017.

*Changes in the number of jobs in the Other category between years are not necessarily a reflection of 75
actual increases or decreases in employment, but may instead be due to changes in the types of jobs included
in this category. energy.gov/sunshot
Source: The Solar Foundation, The National Solar Jobs Census 2015. January 2017.
U.S. Solar Workforce (cont.)
600
# of Workers (000s)

500 Fuels Electric Power Generation

400
300
200
100
0

While 260,000 people in the United States spend at least of their time on solar-related work, 374,000
employees spend some time working for the solar industrylarger than every other energy sector but
petroleum.
The solar industry is creating jobs at a rate 17 times greater than the overall U.S. economy.
In 2016, one in fifty new jobs added in the United States was created by the solar industry.
In 2016, women represented 28% of the solar workforce; veterans accounted for 9.3%both
percentages represent a growth y/y.
Nearly 80% of solar employers report that they have some difficulty finding qualified employees they
need, despite installers offering a medium wage of $26/hr.
76

energy.gov/sunshot
Source: The Solar Foundation, The National Solar Jobs Census 2015. January 2017.
Estimated Value of U.S. Solar Installations
The estimated value of U.S. PV Installations in 2016 was approximately $30 billion.
This represents an increase of 69% over 2015.
62% of 2016 annual value was in the utility sector, 26% in the residential sector,
and 12% in the non-residential sector.
Worldwide installations in 2016 was approximately $100$150 billion.
$35
$30
$30 Utility
Non-Residential
$25
Billions (2016 $)

Residential
$20 $18
$15 $15 $16
$15
$10
$10
$5
$5 $2 $3
$1 $1
$0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Sources: PV installations: DOE 2010 Solar Market Trends Report (U.S. '06-'09); GTM Research / SEIA Solar Market 77
Insight 2016 Year in Review (U.S. '10-'16). PV Price: LBNL Tracking the Sun VIII and Utility-scale Solar (2006-09);
NREL U.S. Solar Photovoltaic System Cost Benchmark Q1 2016; U.S. Jobs: Solar Foundation "National Solar Jobs energy.gov/sunshot
Census 2015 (10-15); SEIA Estimate (06-09).
 Thank You
David Feldman
Senior Financial Analyst
Contractor to the United States Department of Energy
310-266-2679
david.j.feldman@ee.doe.gov

Daniel Boff
Junior Energy Analyst
Contractor to the United States Department of Energy
202-287-1904
daniel.boff@ee.doe.gov

Robert Margolis
Senior Analyst
National Renewable Energy Laboratory
202-488-2222
robert.margolis@nrel.gov

The authors are highly indebted to the following individuals for their insights and
contributions to this brief: Jenny Chase, BNEF; Shayle Kann, GTM Research; Jeffrey Logan,
NREL; Mike Meshek, NREL; Karin Haas, NREL; Scott Gossett, NREL; Mark Mehos (NREL);Paula
Mints, SPV Market Research; David Mooney, NREL; Avi Shultz, DOE; Nathan Serota, BNEF; MJ energy.gov/sunshot
Shiao, GTM Research; Scott Stephens, NRG Energy, Inc.; Craig Turchi, NREL; Edurne Zoco, IHS
U.S. Installation Breakdown
3,500
U.S. PV Utility-Scale
Installations by State (MWAC), 3,000 Residential

Monthly Installations (MW-AC)

2016 2,500 C&I
Utility
2,000

Other, 1,500
2,204 CA, 1,000
2,792
500
NV, 618
GA, 0
736
Feb-14
Apr-14

Feb-15
Apr-15

Feb-16
Apr-16
Aug-14

Dec-14

Aug-15

Dec-15

Aug-16

Dec-16
Jun-14

Oct-14

Jun-15

Oct-15

Jun-16

Oct-16
UT, 680 NC, 835
(500)
U.S. PV Distributed
Installations by State (MWAC), The United States installed almost 4 GWDC of PV in December 2016
2016 and almost 1 GWDC for 8 months in 2016.
Utility-scale PV deployment has much greater seasonal variation than
distributed PV deployment.
Other,
1,019
CA,
1,460
NY, 196 Sources: EIA, Electric Power Monthly, forms EIA-023, EIA-826,
and EIA-861 (February 2017). 79
Notes: EIA monthly data for 2016 are not final. Additionally, smaller
NJ, 234 MA, utilities report information to EIA on a yearly basis, and therefore, a energy.gov/sunshot
247 MD, certain amount of solar data has not yet been reported.
PV Manufacturers Gross Margins
60%
First Solar Renesola
50% JA Solar Yingli
Trina Solar Canadian Solar
40% Jinko Solar Hanwha SolarOne
SunPower Median
30%

20%

10%

0%

-10%

-20%

-30%

Industry gross margins decreased by 55% Q3-Q4 16, with some variation among individual companies:
8% median gross margin of above companies in Q4 16
18% in Q3 16
17% in Q1 16
17% in Q4 15.
Drop in margin is consistent with reports of declining module prices.
80

energy.gov/sunshot
Sources: Company figures based on Q4 16 (and previous) SEC filings by the respective companies.
PV Manufacturers Operating Margins
50%

30%

10%

-10%

-30%

-50%

-70%

-90% First Solar Renesola

-110% JA Solar Yingli
Trina Solar Canadian Solar
-130% Jinko Solar Hanwha Q Cells
SunPower Median
-150%

Operating margins saw a downturn in 2016, with some companies posting operating losses:
-2% median operating margin of the above companies in Q4 16
Previous 8 quarters averaged 1%.

81

energy.gov/sunshot
Sources: Company figures based on Q4 16 (and previous) SEC filings by the respective companies.
Cumulative Solar

December 2010 December 2012 December 2014 December 2016

1.9 GW 6.4 GW 16.5 GW 34.7 GW

The number of states with more than 100 MW-AC has grown from 3 in 2010 to >15,000 MWAC
28 by the end of 2016. >1,500 MWAC
The number of states with more than 15 MW-AC has grown from 16 states in >500 MWAC
>100 MWAC
2010 to 39 states and DC by the end of 2016. >15 MWAC
Despite the growth in the number of markets, more than half of the solar
capacity in the United States is still installed in two states.

82

energy.gov/sunshot
Source: EIA, Electric Power Monthly (February 2017, February 2015).
List of Acronyms and Abbreviations
APAC countries in Asia and Oceana, except China, India, and Japan
ARRA American Recovery and Reinvestment Act of 2009
ASP average selling price
BOS balance-of-system
DG distributed generation
FiT feed-in-tariff
G&A general and administrative expenses
kW kilowatt
kWh kilowatt-hour
LMI low-to-moderate income
MW megawatt
NEM net energy metering
PCS power controlling systems
PPA power purchase agreement
PURPA Public Utility Regulatory Policies Act
Q/Q quarter over quarter
ROW rest of world
SG&A selling, general and administrative expenses
SI systems integration
STH solar thermal heating
SREC solar renewable energy certificates
TTM tech-to-market
TWh terawatt-hours
USD U.S. dollars
W watt
WACC weighted average cost of capital 83
y/y year over year
YTD year to date energy.gov/sunshot