Recently, according to the Solar Energy Industries Association (SEIA) and Wood Mackenzie's "U.S. Solar Market Insights" report for the second quarter of 2023, the U.S. solar industry reached an installed capacity of 6.1GW in the first quarter of 2023.

With supply chain challenges fading and factors causing project delays beginning to move forward, the solar industry experienced its best first quarter in history.

In May, the U.S. Department of the Treasury and the Internal Revenue Service (IRS) issued guidance providing detailed information on the domestic content bonus under the "Inflation Reduction Act". Solar projects using domestic content can receive a 30% full tax credit. Projects using production tax credits can receive an additional 10% tax credit, up to 40%, or 0.3 cents/kWh.

In addition to providing tax credits for clean energy developers, the IRA also provides incentives for the development of U.S. manufacturing. This effectively stimulated many companies to announce their intent to establish domestic manufacturing facilities. The SEIA/Wood Mackenzie report forecasts that the announced increase in manufacturing facilities will lead to domestic component capacity rising from under 9GW currently to over 60GW by 2026. As of the end of the first quarter of 2023, at least 16GW of component manufacturing facilities were under construction.

The SEIA/Wood Mackenzie report also noted that IRA rules make the residential market uncertain. However, the residential market grew by 30% compared to the same period last year. The report estimates that in the first quarter of 2023, the residential sector installed 1.6GW of solar power, with expectations to add 36GW of photovoltaic power in the next five years, with an annual growth rate of 6%.

Looking at the utility-scale market, it rebounded from the middle of 2022 and installed a record 3.8GW capacity. This quarter, more components also met the relevant U.S. local management policy requirements, allowing more solar products to reach project sites and facilitating the construction of long-delayed projects in the industry.

In the commercial and industrial market, the first quarter also set a record, reaching 391MW in scale. This segment market is expected to grow by 12% in 2023. At the same time, the community solar sector installed 212MW, a 13% decrease from the first quarter of 2022, largely due to ongoing challenges with grid connection. Overall, the solar energy industry accounted for 54% of the new grid electricity generation in the first quarter of 2023.

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