September 9, 2022:-The U.S. solar market will nearly triple over the next five years after President Joe Biden signed the most significant climate bill in U.S. history into law, according to a recent report from the Solar Energy Industries Association and Wood Mackenzie.

On Thursday, the report projects the U.S. market was growing 40% more than prior projections by 2027 on the heels of the supportive legislation.

“The Inflation Reduction Act has given the solar industry the most long-term certainty it has ever had,” Michelle Davis, principal analyst at Wood Mackenzie, added.

“Ten years of investment tax CRE standards in stark contrast to the one-, two-, or five-year extension the industry has experienced in the previous decade. It’s not an overstatement to say that the IRA will lead to a re-era for the U.S. solar industry,” she added.

The report pegs the complete solar installations across market segments from 129 gigawatts (GW) today to 336 GW over the next five years.

But in the recent term, the report said issues plaguing the industry, including supply chain delays, can continue to curtail growth.

During the second quarter of 2022, the industry installed 4.6 GW of new solar, down 12% yearly and 12% from the first quarter. The full-year estimates stand at 15.7 GW added, which would be the lowest annual total since 2019.

The report attributed much of the latest slowdown to the Department of Commerce’s dumps and countervailing duty investigation on solar imports from Cambodia, Malaysia, Thailand, and Vietnam. In June, the White House stopped new solar tariffs for two years, but the months of uncertainty stalled recent solar installations as developers waited for clarity on future policies.

“Across the solar industry, second quarter volumes would have been higher if not for supply chain constraints and the industry-wide slowdown from March in June, caused by the initiation of the anticircumvention investigation,” the report added.

Utility-scale solar was impacted, with second-quarter installations falling 25% yearly. Still, the 2.7GW of new capacity was increased by 17% compared to the first quarter. Wood Mackenzie forecasts utility-scale solar for the whole year, seeing its weakest year since 2018.

One bright spot in the second quarter was residential solar. The segment set its fifth quarterly record, with 1.36 GW installed. The number, which is a 37% increase yearly, represents about 180,000 new customers.

The growth comes amid more frequent grid outages. California has asked residents to cut use as record temperatures drive power demand to new highs. Extreme weather events are causing by climate change have also plagued the grid. Power prices are also jumping on the heels of rising commodity prices, prompting consumers to turn to solar power.