USA predict solar will surpass hydropower by 14% in 2024

The U.S. Energy Information Administration predicts that solar power will exceed hydropower by 14% next year. This shift is attributed to the rapid expansion of solar systems' generation capacity and the reduction in manufacturing costs.

As per the data presented in the November Short-Term Energy Outlook by the U.S. Energy Information Administration (EIA), solar power is anticipated to surpass hydroelectric power by 14% in 2024. This conclusion is drawn from industry reports highlighting the continuous growth in utility and small-scale solar plants.

The American Clean Power’s (ACP) quarterly market report reveals that the domestic utility-scale clean energy industry added 5.55 GW of renewables in Q3. Solar installations led the way with 3.1 GW, followed by battery storage at 2.1 GW and land-based wind at 288 MW.

In contrast, the Department of Energy’s (DOE) U.S. Hydropower Market Report 2023 Edition indicates a decline in hydropower activity. Factors such as capacity additions, refurbishment and upgrade investments, turbine runner installations, and hydraulic turbine trade rates showed reduced activity in the early 2020s compared to the 2010s when hydropower capacity increased by 2.1 GW over the decade.

The DOE attributes the decrease in hydropower upgrade and build-out to Covid-19-related trade and travel restrictions, causing supply chain challenges, construction delays, and increased material costs. The Inflation Reduction Act provides tax credits for applicable hydropower and marine energy projects, but the decline in hydropower activity during 2021 and 2022 is also attributed to the legislation.

The Solar Energy Industries Association’s U.S. Solar Market Insight Q3 report predicts a significant increase in domestic solar installations from 153 GW to 375 GW by the end of 2028. This growth is fueled by steady installations in Q1 and Q2 of 2023, overcoming challenges faced by the industry in 2022, including changing regulations and rising material costs.

SEIA’s November Short-Term Energy Outlook notes that changing weather patterns, coupled with increased renewable penetration, have reduced U.S. hydroelectric generation through August this year. Extreme droughts in the West led to decreased hydropower generation in various regions, making the average U.S. net hydropower generation between 2020 and 2022 4.2% lower than the average annual generation during the 2010s.

While weather patterns impact solar and wind power, both have experienced faster growth in generation capacity compared to hydropower. Hydroelectric generators' reliance on reservoirs for water storage faces limitations due to underwater and wetland ecosystem activities, hindering control over output, as suggested by the EIA.