How Is The Us Using Solar Energy?

How is the US using solar energy?

Solar energy has been growing rapidly in the United States over the last decade. In 2022, the U.S. consumed over 1.8 quadrillion British thermal units of solar thermal and photovoltaic energy, up from just 264 trillion Btu in 2010.[1] There are now over 113 gigawatts of total installed solar capacity, enough to power 21 million homes.[2] Solar is currently the fastest-growing energy source in the country.[3]

There are two main uses of solar energy in the U.S. The first is electricity generation from solar photovoltaic panels, which convert sunlight directly into electricity. Most solar PV is from large solar farms that feed into the electric grid, but rooftop solar on homes, businesses, and other buildings is also expanding. The second main use is solar thermal energy, which uses the sun’s heat rather than light to provide hot water, heat buildings, and even generate electricity in some cases.[1]

Solar energy has seen remarkable growth thanks to rapidly declining costs and supportive policies, but still accounted for just 4% of total U.S. utility-scale electricity generation in 2021.[4] However, the solar industry expects continued strong growth in the coming decades.


Residential Solar

The residential solar market in the U.S. has seen rapid growth over the last decade. According to the National Renewable Energy Laboratory, there were about 3.9 million photovoltaic solar power systems installed at residences in the U.S. at the end of 2022. This is up from only 186,000 systems in 2007. California leads the nation in residential solar capacity with over 1.3 million systems, followed by Florida, Arizona, New Jersey and Massachusetts.

Several factors have driven the growth in residential solar. Declining costs for solar panel systems, federal and state tax credits, net metering policies, and rising retail electricity rates have all made solar power more affordable. Many homeowners are installing solar to reduce electricity bills, gain energy independence, and lower their carbon footprint.

The most common financial incentive is the federal solar Investment Tax Credit (ITC), which allows homeowners to deduct 26% of installation costs from federal taxes through 2032. Some states and utilities offer additional rebates and incentives. For example, California has the California Solar Initiative rebate program.


Commercial Solar

Many corporations are adopting solar energy to power their operations and facilities. According to Solar Power World, the top commercial solar contractors in 2021 included Duke Energy Sustainable Solutions, AUI Partners, and Nexamp ( Some of the largest commercial solar installations in the US include the Solar Star project in California, which generates 579 MW, and the Topaz Solar Farm, also in California, which produces 550 MW ( Major companies investing in solar include Apple, Amazon, Walmart, Target, and Google. Apple has pledged to run all of its operations on 100% renewable energy, and as of 2018, all of Apple’s retail stores, data centers, and corporate campuses worldwide are powered by clean energy.

Utility-Scale Solar

The growth of utility-scale solar in the US has been explosive over the last decade. Utility-scale solar refers to large-scale solar power plants that generate energy to be fed into the electricity grid for sale to utilities or retail customers.

Some of the largest solar farms in the US include:

California leads the nation with multiple gigawatts of utility-scale solar capacity. Other leaders include Arizona, Nevada, Texas, and Florida. The pipelines of announced and under construction utility-scale solar indicate continued rapid growth in the coming years.

Solar Thermal

Solar thermal energy is used to heat water in residential and commercial buildings across the United States. Solar water heating systems use solar collectors, usually mounted on rooftops, that heat water which is then stored in a tank. According to the U.S. Energy Information Administration, over 2.3 million American homes and businesses used solar water heating in 2020 (source 1).

In addition to water heating applications, the U.S. also utilizes concentrating solar power (CSP) plants to generate electricity. CSP plants use mirrors to focus sunlight on a receiver containing a heat-transfer fluid. The heated fluid is then used to create steam to run a turbine and generator. As of 2021, there were just under 2 gigawatts of CSP capacity operating in the U.S., with the largest plants located in California, Nevada, and Arizona (source 2). Although a relatively small amount of total solar generation, CSP provides the unique ability to readily store thermal energy for use when the sun is not shining.

Solar Vehicles

The use of solar power in electric vehicles is growing as a way to reduce dependency on fossil fuels. Companies like Aptera Motors and Lightyear are bringing solar electric vehicles to market that can charge through sunlight alone for daily commuting (Aptera Motors; Why solar electric vehicles might be the next generation of EVs). These solar EVs have integrated solar panels on their exterior that charge the battery when exposed to sunlight. For example, the Lightyear 0 is estimated to get over 7 miles of charge per hour from the sun.

Solar vehicles are also popular for solar car races, where teams design and build solar powered cars to compete in cross-country endurance challenges. The World Solar Challenge has been held since 1987 across the Australian Outback, pushing teams to build the most efficient solar vehicles. These races drive innovation in solar technology and energy efficiency.

Solar Manufacturing

The United States has ramped up domestic solar panel manufacturing in recent years through incentives and investments. Some of the leading American solar panel manufacturers include Silfab Solar, Mission Solar, and Heliene. Many foreign manufacturers like JinkoSolar and Canadian Solar have also opened factories in the U.S. to take advantage of domestic manufacturing incentives.

The U.S. government has implemented policies like the Solar Energy Manufacturing for America Act to support American solar manufacturing. This act provides tax credits for companies that manufacture solar panels and components in the U.S. There are also initiatives at the state level. For example, New York state committed over $400 million in investments for solar manufacturing facilities.

Experts predict U.S. solar manufacturing capacity to grow substantially in the coming years. The Solar Energy Industry Association estimates that solar panels made in America could quadruple from 2020 to 2023. Government support and competitive incentives are making the U.S. more attractive for solar manufacturing.


The U.S. Department of Energy funds solar energy research through the Solar Energy Technologies Office (SETO) to drive continued advancement and innovation in solar technologies. SETO invests in early-stage research and development to improve the affordability, reliability, and performance of solar technologies on the grid. According to SETO, their funding priorities for solar R&D include improving photovoltaics, concentrating solar-thermal power, systems integration, and manufacturing technologies.

Major American universities are also advancing solar research through projects funded by SETO and other sources. For example, researchers at MIT are working on new materials and designs to improve solar cell efficiency, lower costs, and enhance reliability. The National Science Foundation has funded an Engineering Research Center for Quantum Energy and Sustainable Solar Technologies (QESST) led by Arizona State University along with MIT and other partners. QESST is focused on developing next-generation photovoltaics and improving grid integration. Overall, strong public and private investment in solar R&D will be essential for continued innovation and cost reductions.


The U.S. government has implemented various policies at the federal, state, and local levels to encourage the adoption of solar energy. Key federal policies include renewable portfolio standards, tax credits, loan guarantees, and grants.

The federal government has set a goal for federal agencies to consume at least 7.5% of electricity from renewable sources under the Energy Policy Act of 2005 (source). The investment tax credit (ITC) offers a 26% tax credit for installing residential and commercial solar systems that will be reduced to 22% in 2023 and 10% in 2024 (source).

Many U.S. states offer additional incentives for solar installation such as rebates, property tax exemptions, renewable portfolio standards, and net metering policies. For example, California requires utilities to source 60% of their electricity from renewables by 2030 (source).

Future Outlook

The future looks bright for solar energy in the United States. According to projections by the U.S. Energy Information Administration, the country will generate 14% more electricity from solar energy than from hydroelectric facilities in 2024 [1]. Looking further ahead, the Solar Futures Study by the National Renewable Energy Laboratory finds that solar energy could power about 14% of transportation end uses by 2050 [2]. This growth will be driven by continuing cost reductions and performance improvements in both photovoltaic and concentrating solar power technologies.

Experts at MIT predict that by 2030, solar photovoltaics and concentrated solar power will comprise 10% of the worldwide electricity capacity, up from just 2% today [3]. To achieve higher penetration rates, researchers are working on new materials, system designs, and manufacturing processes to increase solar cell efficiency and lower costs. Key areas of innovation include perovskite solar cells, tandem cells, solar fuels, and integrated PV-battery systems.

With supportive policies and sustained research funding, solar energy is poised to be a major pillar of the future renewable electricity system in the United States.

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