As the year comes to a close, it's fitting that the week in solar was dominated by the kind of large, macro trends that seem to move and shake the solar industry every few months. But unlike 2015, when we had Nevada upend net metering in the final hours of the year, most of the news from the solar industry is positive at the end of 2016. There are still some challenges looking forward, but policy seems to be favoring solar energy in the long term.
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Image source: Getty Images.
China resets renewable energy prices
One of the biggest drivers of solar growth in 2016 was China's feed-in tariff rates. A feed-in tariff drove an estimated 13 GW of solar installations in the first half of the year before being reset in the second half. Now feed-in tariff rates will fall another 19% for 2017, and China has lowered its 2020 installation target from 150 GW to a minimum of 105 GW.
Chinese leadership has also suggested that local governments use auctions for renewable energy, which has been a successful arrangement in Latin America and Europe. At the very least, this gives some stability to the solar market in 2017, and may help increase demand for solar panels overall next year.
Another state solar win
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Ohio has had a freeze on its renewable energy mandates for the last two years, and lawmakers wanted to extend that hold -- but Governor John Kasich vetoed a bill that would have made energy mandates voluntary for another two years. Kasich was praised by seven major employers in Ohio for keeping renewable energy mandates. And it shouldn't go unnoticed that First Solar (NASDAQ: FSLR) has a major manufacturing plant there and is upgrading the facility over the next couple of years.
In state after state, solar energy has fought off regulatory and legislative battles to grow its presence in the energy industry. Ohio is another example of a big solar win, and as a leading Midwestern state it may become a solar leader, showing where the future of energy jobs is headed.
Panasonic helping Tesla with solar
Panasonic is coming to the rescue of SolarCity's Silevo solar manufacturing plant, agreeing to invest $256 million in the facility. Tesla (NASDAQ: TSLA) made the investment contingent on its SolarCity acquisition going through; now that the companies are combined, Panasonic is being brought in to help with solar.
Panasonic says production will begin in the summer of 2017 with 1 GW of production expected in 2019, but it's worth pointing out that Panasonic has had trouble making competitive solar panels itself, and Silevo's technology has proven disappointing, especially given the fact that it had to bring in a partner to bring production to fruition.
It's also worth noting that this Panasonic partnership will help make the cells for the solar roof. Not only is the Buffalo facility key to keeping Tesla ahead of competitors in rooftop solar, it will be key to making the solar roof a reality. There's a lot riding on this partnership today.
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