PNM’s three projects total 22.8 MW, while SCE’s three projects total 19 MW. Edison has a power purchase agreement for an additional 20-MW project bringing its Q1 total to 39 MW.
A small but steady stream of utility-owned projects also appears to be taking shape, with as many as nine more such plants under construction and an additional two in advanced stages of development.
Merchant solar plants, financed and built without power purchase agreements (PPAs), are yet another part of the market diversification underway. The 5-MW North Run solar project in New Jersey and the 6-MW Leicester solar project in Massachusetts were completed in Q1 as supply-side resources selling their generation wholesale into the PJM and ISO New England (ISO-NE) markets respectively.
The Leicester project is the first merchant plant over 5 MW in the ISO-NE region, according to SEPA’s data. While the specifics of wholesale market structures and practices vary between regions, only two other transmission operators in the United States — PJM in the mid-Atlantic and Midwest, and the Electric Reliability Council of Texas (ERCOT) — are interconnecting merchant solar power plants.
The Post-ITC pipeline: A megascale comeback?
As might be expected, given the low numbers, most of the projects coming online in Q1 stayed at the smaller end of the utility solar scale — 20 MW and under. But, two outliers totaling 130 MW gave Nevada more than half of the quarter’s new capacity, pushing California from its usual dominance of the market to the No. 2 position.
Again, California’s four projects totaled 39 MW, followed by New Mexico with three projects totaling 22.8 MW. Massachusetts, Texas, North Carolina and New Jersey each added one new project, all hovering between 6 MW and 5 MW.
Meanwhile, the looming impact of the ITC step-down continues to depress the number of new project announcements, with Q1 posting the third decline in as many quarters. Further, among the 10 projects announced in the quarter, only two are scheduled to be completed before the end of 2016.
The remaining eight have yet to specify target dates for completion, but smaller projects with faster turnaround times can be expected as developers race to get under the wire for existing federal tax benefits.
All that said, as the solar industry continues to focus on driving down costs -- for both hardware and balance of system "soft costs" -- industry expectations for the post-2017 market remain guardedly optimistic.
Ryan Edge is a research analyst with SEPA. He can be best reached via direct email: [email protected].
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UTILITY-SCALE SOLAR STARTS 2015 WITH A WHIMPER, BUT REBOUND TO FOLLOW