U.S. Solar Market Poised for 50% Annual Growth-Report

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"The strong demand represents over $6.1 billion in investments per year and the creation of 50,000 jobs. . ."

Solar energy installations in the United States are poised to grow about 50% annually in the next three years as the country closes in on Germany, the largest solar market in the world.

The U.S. is likely to install 400 megawatts of new solar projects in 2009, and see the growth reach 1.5 gigawatts to 2 gigawatts of new installations in 2012, according to GTM Research's new report released Tuesday.

The strong demand represents over $6.1 billion in investments per year and the creation of 50,000 jobs, GTM Research said.

The report, The United States PV Market Through 2013: Project Economics, Policy, Demand and Strategy, analyzed the scope and financing of power projects by major developers. It also examined policies and demand of big solar states, and detailed the impact of the American Recovery and Reinvestment Act of 2009 (ARRA).

Like other hot solar markets in the world, government incentives are a big reason for fueling growth in the next few years. Last October, Congress extended a 30% investment tax credit for solar installations for eight years. The legislation gets rid of a $2,000 cap for residential installations and allows the utilities to take advantage of the tax credit.

Another booster shot is coming from the ARRA, which has created a host of grants, tax credits and loan guarantees for manufacturing solar energy equipment and installing them.

These federal subsidies, coupled with states' own incentives and mandates for renewable energy installations and consumption, will propel growth for residential and utility-scale projects, the report said. Projects developed to service utility customers will likely grow the fastest, from installing nearly 91 megawatts in 2009 to adding 466 megawatts in 2012 under a conservative estimate.

Twenty-nine states and the District of Columbia are requiring utilities to serve up an increasing amount of renewable electricity.

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