US solar energy market still attractive to investors

Solar energy industry is today the fastest growing industry in the United States with U.S. solar energy market rapidly expanding as it attracts more and more investors. The latest report by Frost & Sullivan says that the utility scale solar power market in the U.S. will attract more than US$20 billion worth of investment by 2016.

The positive solar energy outlook has instilled confidence in many of U.S. major investors such as Warren Buffet’s MidAmerican Renewables, with many new solar energy projects being developed all across the country.

California is still the largest U.S. solar energy market, and this isn't expected to change for foreseeable future. Many other states, most notably New Jersey, are also looking good in solar energy development, and as the result of this solar is taking a large chunk of new energy capacity in the U.S. market.

The average selling prices of solar panels still continue to decline making solar power more affordable to not just large and small business, but also to many homeowners. The only somewhat negative thing is the uncertainty on whether the cash grants for solar development will be extended past March 1, 2013.

As with any other market, investors want long-term certainty to be able to return their initial investment. Renewable energy portfolio standards (RPS) are also driving the demand for solar power. The states with RPS have been rapidly adopting solar power and thus attracting lion share of total investments into solar energy market.

Photovoltaics are still the dominant segment of the utility scale solar power market although concentrated solar power (CSP) is also rapidly developing and should account for lot bigger role in years to come.