Despite some business disruptions going on in solar power manufacturing, installations of solar power systems in the United States are running at record levels.
The Solar Energy Industries Association trade group reports that 3,316 megawatts of solar capacity were installed last year by U.S. homes, businesses and utilities, a rise of 76 percent from the year before.
The trade group estimates the U.S. now has 7,700 megawatts of solar systems deployed, enough to power more than 1.2 million homes.
In the first quarter, it added, solar systems accounted for 49 percent of all new electrical power installations.
Circular Energy of Austin, a four-year-old startup, is riding that expansion wave. The company, which employs 47 people, installs solar systems in homes and businesses in Austin, San Antonio, Dallas and Houston. It also develops a software system that monitors the efficiency of its solar systems and helps customers manage their energy consumption.
The company recently raised $2.7 million in equity and royalty financing to support more expansion.
“Circular has real revenue and real growth,” said Ed Mellow, co-founder and managing partner of Cypress Growth Capital of Dallas, which provided $1 million in financing to the company with an option to do more in the future. Cypress provides royalty financing to young tech companies that generally have revenue of between $3 million and $15 million and in return it gets a share of the company’s revenue stream. “This is another way to get growth capital without giving up a big chunk of your (equity) capital.”
Circular Energy is its first investment in Austin, but it is pursuing other deals.
The Austin company, its investors say, has the management savvy and a demonstrable record of growth and customer service.
Circular CEO J.C. Shore says his company is including its proprietary Curb energy management system with new solar customers. Early users of Curb have resulted in energy savings of more than 15 percent, the company said.
Part of what is driving solar installation growth in the U.S. is falling prices for solar hardware.
The Solar Energy Industries Association estimates that the average price of a completed solar system in the U.S. dropped 27 percent in the past year, while the average price of a solar panel has dropped by 60 percent since the start of 2011.
“While these price drops are beneficial for consumers,” the trade group said, “The rapid fall in prices, due in part to a global oversupply, has put significant strain on manufacturers worldwide.”
While solar installations are expanding in Texas, the leading states for solar are California, Arizona and New Jersey. Texas ranked ninth among U.S. solar markets with 2.5 megawatts of capacity installed in the fourth quarter, the trade group said. California, the largest market saw 22 times more in installations.
Utility projects account for more than 53 percent of the installed capacity last year, while residential accounted for 15 percent and business for 32 percent.
Carrie Hitt, the trade association’s senior vice president for state affairs, says Texas could be a natural boom market for solar because of its high growth and high rate of electrical usage.
Some solar investors, she said, are talking with the Electric Reliability Council of Texas (ERCOT) about helping meet the state’s expanding electricity needs through the building of major solar farms. ERCOT operates the Texas electrical grid. serving about 23 million customers.
In general, the states that lead in solar installations, Hitt said, have stronger statewide policy frameworks to promote the energy source. Those policies include both incentives and steps to speed up systems inspections.