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Title: The Evolving Market Structure of the U.S. Residential Solar PV Installation Industry, 2000-2016

Abstract

This study uses data on over 900,000 solar PV installations to summarize the evolving market structure of the U.S. residential solar PV installation industry. Over 8,000 companies have installed residential PV systems in the United States. The vast majority of these installers are small local companies. At the same time, a subset of national-scale high-volume PV installation companies hold high market shares. This study examines the factors behind these trends in market concentration, including the role of customer financing options.

Authors:
 [1]
  1. National Renewable Energy Lab. (NREL), Golden, CO (United States)
Publication Date:
Research Org.:
National Renewable Energy Lab. (NREL), Golden, CO (United States)
Sponsoring Org.:
USDOE Office of Energy Efficiency and Renewable Energy (EERE), Solar Energy Technologies Office (EE-4S)
OSTI Identifier:
1417733
Report Number(s):
NREL/TP-6A20-70545
DOE Contract Number:
AC36-08GO28308
Resource Type:
Technical Report
Country of Publication:
United States
Language:
English
Subject:
14 SOLAR ENERGY; PV systems; market structure; residential solar PV installation; photovoltaics; financing

Citation Formats

OShaughnessy, Eric J. The Evolving Market Structure of the U.S. Residential Solar PV Installation Industry, 2000-2016. United States: N. p., 2018. Web. doi:10.2172/1417733.
OShaughnessy, Eric J. The Evolving Market Structure of the U.S. Residential Solar PV Installation Industry, 2000-2016. United States. doi:10.2172/1417733.
OShaughnessy, Eric J. Tue . "The Evolving Market Structure of the U.S. Residential Solar PV Installation Industry, 2000-2016". United States. doi:10.2172/1417733. https://www.osti.gov/servlets/purl/1417733.
@article{osti_1417733,
title = {The Evolving Market Structure of the U.S. Residential Solar PV Installation Industry, 2000-2016},
author = {OShaughnessy, Eric J.},
abstractNote = {This study uses data on over 900,000 solar PV installations to summarize the evolving market structure of the U.S. residential solar PV installation industry. Over 8,000 companies have installed residential PV systems in the United States. The vast majority of these installers are small local companies. At the same time, a subset of national-scale high-volume PV installation companies hold high market shares. This study examines the factors behind these trends in market concentration, including the role of customer financing options.},
doi = {10.2172/1417733},
journal = {},
number = ,
volume = ,
place = {United States},
year = {Tue Jan 16 00:00:00 EST 2018},
month = {Tue Jan 16 00:00:00 EST 2018}
}

Technical Report:

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  • Market structure refers to the number of firms and the distribution of market shares among firms within an industry. In The Evolving Market Structure of the U.S. Residential Solar PV Installation Industry, 2000-2016, we examine market structure in the context of residential solar PV. We find that over 8,000 companies have installed at least one residential PV system, with about 2,900 companies active in 2016. The majority of residential PV installers are relatively small companies, with about half of installers installing fewer than five systems. At the same time, a subset of high-volume installers accumulated market share, especially beginning aroundmore » 2010 with the emergence of alternative customer financing options.« less
  • The price of photovoltaic (PV) systems in the United States (i.e., the cost to the system owner) has dropped precipitously in recent years, led by substantial reductions in global PV module prices. This report provides a Q4 2013 update for residential PV systems, based on an objective methodology that closely approximates the book value of a PV system. Several cases are benchmarked to represent common variation in business models, labor rates, and module choice. We estimate a weighted-average cash purchase price of $3.29/W for modeled standard-efficiency, polycrystalline-silicon residential PV systems installed in the United States. This is a 46% declinemore » from the 2013-dollar-adjusted price reported in the Q4 2010 benchmark report. In addition, this report frames the cash purchase price in the context of key price metrics relevant to the continually evolving landscape of third-party-owned PV systems by benchmarking the minimum sustainable lease price and the fair market value of residential PV systems.« less
  • Competition among residential solar photovoltaic (PV) installers may reduce PV price markups and yield lower prices. At the same time, competition may reduce installer experience and opportunities for cost reductions through learning-by-doing and economies of scale. These dynamics suggest that PV non-hardware or 'soft' costs and installed prices depend on the distribution of market shares among installers, also known as market concentration. This study leverages a rich data set of 226,769 residential PV systems to examine the relationship between market concentration, soft costs, and PV prices. The results show that PV prices are lower, on average, in more concentrated markets,more » i.e., markets with fewer installers or where few installers hold high market share. The study provides evidence that this relationship is non-linear, such that prices are minimized in markets with an optimal balance of the benefits of market concentration and the benefits of competition.« less