Community solar farms, which parse out clean energy to a group of shareholders, have emerged as the next largest solar market in the U.S.
Over the next two years, community solar in the U.S. is poised to see its market size increase seven-fold, and by 2020 it will be expanding by half a billion watts annually, according to a new report by GTM Research.
One of the benefits of a community solar farm is that it offers consumers who don't even own a home (such as renters) the ability to go solar.
Community solar farms, like community gardens, share the photovoltaic energy among a group who purchase a share of the total energy produced by the site and receive the benefits of reduced costs on their electric bill.
According to the Solar Energy Industry Association (SEIA), there are at least 52 community farms the U.S. states. And, at least 10 states are encouraging their growth through policy and programs.
Twenty-four states have at least one community solar project in operation, with 12 states operating at least two community farms or more, GTM said. The leading states based on operating capacity are Arizona, Colorado, California and Massachusetts.
At least 10 states are considering active community solar legislation to promote shared resources.
California, for example, is preparing to implement two community solar programs, one for utility-led development and another for third-party development. The program calls for 600 megawatts (MW) by 2019, with 110.5MW required by 2016.
Clean Energy Collective (CEC) and SunShare are the market leaders in building community solar farms, with a 32% combined market share, according to GTM.
As with other solar collectives, CEC and SunShare typically partner with utilities to develop high-volume, one-off community solar projects. Additionally, GTM Research reported today that 55 billion watts (55 gigawatts or GW) will be installed globally in 2015, a 36% increase over 2014.
Solar will account for roughly half of new electricity capacity out to 2020, the new report stated.
"If 2014 was a 'transitional year,' ...2015 will be a transcendent year," GTM said.
China and the Asia-Pacific region, which will install more than half of all global photovoltaic panels this year, are leading the global solar power market. Europe will begin an upswing, and North America, primarily the United States, will continue its year-over-year growth.
"China has emerged as the largest global market for PV, underpinned by a new feed-in tariff program and ambitious solar goals under the Five Year Plan," GTM Research analyst Adam James said. "GTM Research forecasts that China will install 14 gigawatts of the region's 30 gigawatts of PV in 2015."
Europe's share of the global PV market has steadily declined since its dominance in the period 2004-2011. However, GTM Research expects it to bottom out this year at 21% and begin growing again in 2016. By 2020, Europe will install 42GW and account for 31% of the global market.
The United States will be the third-ranked PV market this year, behind only China and Japan. GTM Research forecasts the United States to install 8GW, which constitutes 14% of the global PV market.
"To date, the global solar PV market has been largely shaped by policy booms and busts. However, with costs continuing to fall, we're entering a new era of economic competitiveness in which solar PV will be increasingly market-based," GTM stated in its report.
According to the report, the solar market will also see new countries come into play.
"One profound change in the global landscape is that emerging regional markets - such as Latin America, Africa and the Middle East - are expected to grow from their historical levels of 1% of annual demand to 17% over the next five years," James stated.