North Carolina is a solar giant. As development slows, which state will step up to take its place?
It is no secret that North Carolina has experienced a solar boom in recent years, skyrocketing to the #3 spot nationally in terms of installed capacity. This boom was jumpstarted by a 35% state tax credit and an attractive qualifying facility (QF) rate and contract term. As a result, the Solar Foundation counted nearly 6,000 workers in the Tar Heel state at the end of 2015.
Since the expiration of the state tax credit, the market is not drying up, but it has certainly slowed down. Add long approval timelines for interconnection and Duke’s new “circuit stiffness reviews,” (trademark that one, guys) and this runaway market is certainly slowing. Where will developers in the region run to next?
We have written before about South Carolina, which has experienced rapid solar growth – both on the utility-scale and residential side – in 2016. If the market could only fix its property tax challenges, it could rival its northern counterpart. Georgia, on the other hand, has now matured, with promises of more solar on the way. As these states increase in penetration – and competition – developers are starting to race to markets further down South – such as Louisiana, Mississippi, and Alabama – in search of low cost land and labor, and the possibility of long-term bilateral contracts with utilities and cooperatives.
To be clear, the North Carolina market won’t be coming to a halt any time soon – or so long as the fundamentals of PURPA are upheld, a critical issue for our industry and one worth fighting for. As the state faces continued penetration, which state will become the next North Carolina? The race is on.
This is an excerpt from the October edition of SOURCE: the Sol Project Finance Journal, a monthly electronic newsletter analyzing the solar industry’s latest trends based on our unique position in the solar financing space. To view the full Journal, please subscribe or e-mail pr@solsystems.com.
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