Demand for large-scale utility solar projects in the U.S. is increasing at an impressive clip, and the economic development associated with this growth is reaching the critical mass required to garner the interest of communities nationwide.
According to the latest data from the Solar Energy Industries Association, 845 MW of solar energy were installed across the country during the first quarter of this year, augmenting the record-breaking 3,313 MW installed in 2012. Photovoltaic installations grew 76% in 2012 over 2011, with an estimated market value of $11.5 billion.
This not only demonstrates the growing demand for renewable energy at the community level, but also underscores the realization of how powerful renewable energy projects can be as economic development drivers. Increasingly, community leaders and taxpayers are joining forces with local governments to help bring renewable energy projects to their areas. These community initiatives are not only being fueled by the desire for lower cost and renewable sources of energy, but also because of broader economic development benefits with long-term impact.
A prime example of a solar power development project planned to achieve economic development goals is in San Antonio. San Antonio's municipal utility, CPS Energy, is a trailblazer for this model. The utility is investing in sustainable energy that will protect its customers from environmental regulatory risk and create a sustainable energy resource. This investment has spurred a hub of solar power-related jobs and investment in renewable energy production in the community.
In addition to adding 400 MW of solar power to the city's power grid in the next four years, San Antonio is also the U.S. headquarters of a leading solar panel manufacturer, as well as a company that produces trackers and one that produces inverters. With the location of manufacturing facilities, San Antonio is building a renewable energy cluster and attracting a variety of other supplier businesses and additional jobs. This investment in solar development and manufacturing is expediting local solar power projects and creating more than 800 permanent jobs, including hundreds in the manufacturing facilities alone.
Solar power development can be a significant driver of job creation. Many solar projects generate project-term job opportunities in site development, construction and installation, as well as permanent jobs for the ongoing management and maintenance of the facility. The construction of these facilities is labor intensive, supporting a variety of roles, including highly skilled labor and white collar positions. Indirect jobs in associated businesses and industries are also created. Various industry studies estimate that for every job created by the PV industry, between one and three jobs are created in other related industries.
Given the wide positive impact of solar energy projects on communities, it's even more important for the solar community to factor economic development implications of their projects into their plans, including the project's ability to create jobs, attract other businesses and associated industries, and foster long-term economic growth. Economic development components of energy projects are becoming a requirement for community investment as future demand and need grow.
According to the Department of Energy, communities hoping to develop the economic engines created by solar energy hubs similar to San Antonio's must think about how they can create policies that build long-term partnerships that are mutually beneficial to power companies and the community. To build these types of investments that spur economic development, communities must offer a variety of levels of support, including tax policies to support renewable energy programs, involvement of public and private sector leaders, and broader education efforts to encourage cooperation between local government, community leaders and energy industry stakeholders.
As we look toward the next decade, investment in solar power will be considered a source for economic development. By working collaboratively with local communities to better understand their economic development goals, solar developers can effectively deliver sustainable energy and sustainable economic development. And that helps ensure a brighter future for everyone.
Tony Dorazio is president of OCI Solar Power, a developer of utility-scale solar installations based in San Antonio. He can be reached here.