Business & Investments

Sunny Days for Solar Power Business as Government Incentives Will Support Income Growth as Demand Heats Up

IBISWorld Market place Analysis

Los Angeles, CA (PRWEB) November 23, 2011

The Solar Energy business in the United States is set to develop a wholesome glow more than the next 5 years, according to IBISWorld, the nation’s largest publisher of market analysis. In that time, favorable government legislation is projected to continue to make solar energy cost-competitive with other energy generation sources. Also, via 2016, increased solar panel production will lead to lower panel costs, which will drive growth as the cost of the industry’s principal input declines. As a result of these trends, market income is forecast to rise at an typical annual rate of 11.4% and total $ 145.9 million through 2016.

According to IBISWorld’s latest statistics, general economic circumstances are anticipated to strengthen as consumer income increases and companies invest far more. As these trends prevail, growth in electricity demand is anticipated to follow. Demand for solar power will rise in tandem with electricity demand as firms seek to diversify power sources and “green” electricity becomes much more of a focus for the United States. Nevertheless, despite expected favorable government incentives over the subsequent five years, government legislation beyond 2012 will depend on the makeup of congress and the newly elected president. This will moderately limit revenue growth.

The Solar Power market has skilled bright days over the five years to 2011. Generous government incentives have pushed income growth by delivering tax credits for investing in solar power and by enacting renewable portfolio standards (RPSs). These standards, enacted in 29 states, need nearby utilities to create electricity from renewable energy as a percentage of their total power portfolio. Increased interest in green technology also influenced market efficiency by sparking interest in technologies that displace other sorts of power generation sources, such as coal and gas.

Favorable government assistance and nearby-government regulation regarding renewable energy has led to big growth in US solar power business projects benefiting organizations like, NextEra Power Inc., MEMC Electronic Supplies and Abengoa Solar. The boost reflects a high level of assistance for the industry, which typically has a hard time competing against traditional power-generation commodities, such as all-natural gas and oil. The assistance, supplied in the form of federal tax credits and RPSs, has pushed solar-electricity generation greater. In addition, as the global recession began, a glut in the international supply of silicon occurred, and Chinese solar panel and module manufacturers could not sell their merchandise at prerecession rates. As such, solar power producers acquired panels at less expensive rates. In turn, they experienced higher profit margins and undertook projects that were otherwise not profitable.

According to IBISWorld analyst, Justin Molavi, Government assistance is expected to continue to support market players in the US Solar Power market compete with other energy generation technologies by lowering the cost of solar projects. State mandates for renewable-power energy will continue to translate into greater industry income. Moreover, firming US economic growth during the next five years will contribute to much more robust demand conditions for electricity generators. As buyers have far more income and organizations invest more, demand for electricity will continue to boost. As a result, market firms are expected to benefit from the continued push into renewable-power generation, which will lead to elevated solar-power output. Given these circumstances, industry revenue is projected to grow an average of 11.four% per year over the next 5 years and total $ 145.9 million in 2016.

For far more information, download the full report from IBISWorld on the Solar Energy business

IBISWorld Solar Energy Market Marketplace Research Reports Contain:

About this Business

Business Definition

Major Activities

Comparable Industries

Extra Resources

Business at a Glance

Industry Performance

Executive Summary

Important External Drivers

Present Efficiency

Business Outlook

Market Life Cycle

Products &amp Markets

Supply Chain

Goods &amp Services

Significant Markets

Globalisation &amp Trade

Company Locations

Competitive Landscape

Market place Share Concentration

Crucial Success Aspects

Cost Structure Benchmarks

Barriers to Entry

Major Firms

Operating Circumstances

Capital Intensity

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Annual Modify

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About IBISWorld Inc.

Recognized as the nation’s most trusted independent source of business and industry analysis, IBISWorld gives a comprehensive database of exclusive info and analysis on each and every US market. With an extensive online portfolio, valued for its depth and scope, the company equips customers with the insight essential to make far better business choices. Headquartered in Los Angeles, IBISWorld serves a range of organization, professional service and government organizations via more than 10 locations worldwide. For much more information, check out http://www.ibisworld.com or call 1-800-330-3772.

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