Solar market update: Southeast U.S.

At the RE+ Southeast regional renewable energy conference held in Atlanta this month, panelists shared that nationwide, solar installations heated up to a record 13 GW deployed in Q4, 2023. The United States is setting the stage for an energy transition carried largely by solar and energy storage, with over 670 GW of cumulative solar installations expected by 2034, multiplying the nation’s current total of less than 200 GW.

Growing power demand and decarbonization goals continue to push solar adoption, and subsidies made available from the Inflation Reduction Act of 2022 are sweetening the pot on both the supply and demand side.

The U.S. Southeast, though not typically a leader in renewables investment, stands to see considerable growth in solar, energy storage, and other emissions-free technologies. Below are state-by-state insights shared by expert speakers at the RE+ conference.

Virginia

Virginia’s solar economy is propelled forward in part by its 2021 Clean Economy Act, which mandated a renewable portfolio standard (RPS) and clean energy public interest policies. The RPS requires the state to achieve 100% renewable energy by 2045.

The RPS also requires that 75% of renewable energy credits (REC) procured by the state’s largest utility, Dominion, must be sourced from in-state resources, starting in 2025. Dominion is also required to meet a distributed generation carve-out for projects 1 MW and smaller, which are often rooftop solar installations. The carve-out increases 1% per year.

The RPS creates a long runway for growth in the state, as it declares over 16 GW of solar and wind capacity to be in the public interest. It also declares 2.7 GW of energy storage to be in the public interest and includes a 10% behind-the-meter carve out for distributed storage. Virginia also has an active net metering program for rooftop solar arrays and is developing a shared solar program in its legislative sessions.

Robin Dutta, executive director of Chesapeake Solar and Storage Association, said that changes are needed to ensure the state’s Clean Economy Act is effective. He highlighted that the state lacks a policy infrastructure to establish a tradeable renewable energy credit (REC) market.

Dutta recommended the state approve an introduced bill, HB 638, to increase the distributed generation carveout and limit utility capture of the energy transition through competitive private procurement requirements.

Georgia

Georgia has a strong position in the solar market, ranking seventh in total installed capacity among the states. About 6% of its electricity comes from solar, and over 5,000 people are employed in solar in Georgia.

Numerous requests for proposals (RFP) have been filed in the state, including two RFP for just over 1 GW each in late 2023 and 2025. The Public Service Commission approved a 193 MW distributed solar RFP.

The state’s utility, Georgia Power Company, said it would be 6.6 GW short of capacity over the next 10 years, and submitted a request to the Public Service Commission requesting to source its power predominantly from fossil fuels and utility Mississippi Power. It has also committed to adding 4 GW of renewable energy by 2035.

On the legislative landscape, the conference panelists highlighted several bills to watch in the state, including:

HB 300 “Decommissioning Act”
SB 210 / HB 1152 “Georgia Homegrown Solar Act”
HB 1312 extends Public Service Commission terms and requires elections for PSC members

Alabama, Louisiana, Mississippi

The Gulf has among the lowest adoption of solar, but in recent years growth has expanded considerably. Projects are stacking up in regional grid operators’ grid interconnection queues, an approval process that is creating significant bottlenecks for development in the region.

In Louisiana, over 18 GW of standalone solar projects and 5.6 GW of hybrid solar and storage projects are awaiting approval in interconnection queues for the MISO region, and very little in the SPP region.

Mississippi has over 7 GW of standalone solar and nearly 6 GW of hybrid solar projects in queues for the MISO region, and in the TVA region, over 2 GW of solar and 1.7 GW of hybrid projects are in the queues.

Alabama has the least amount of solar on the way in the Gulf region. About 1.7 GW of solar and 1.4 GW of hybrid solar-storage in the Southern region awaits interconnection, while TVA has less than 1 GW in queues for standalone solar.

The panelists recommended watching the following potential policy changes in the Gulf:

Louisiana HB 893 – Solar buffer laws
Louisiana SB 108 – Transmission expropriation
Mississippi Special SB 2001 – Amazon data centers
Alabama – Lawrence County local zoning laws

Order 2023 interconnection reform, passed in July 2023, is expected to help alleviate the sluggish interconnection process in the Gulf region that has been a major damper on development, said the RE+ panelists.

The Carolinas

North Carolina has the nation’s fourth-highest solar capacity, with about 4.8 GW installed, while South Carolina is 16th highest, with about 2.5 GW installed. The panelists said lawmakers’ attitudes towards solar are mostly favorable, with goals to balance costs and benefits to all customers.

North Carolina has one of the nation’s longest-standing renewable portfolio standards, established in 2007. It is one of the largest beneficiaries from incentives in the Inflation Reduction Act of 2022 and plays a major role in the $7 billion Solar for All program.

Both states have an established net metering program, and a community solar market that has largely been adopted by electric co-ops and municipalities, but not by investor-owned utilities.

Regional utility Duke Energy Carolinas plans to retire operational coal plants by 2035 and achieve carbon neutrality by 2050. Recent filings have expanded the utility’s load forecast to 33.5 GW as the region’s population grows quickly, and the utility has shifted away from nuclear and towards solar in its roadmap to meet demand.

Tennessee

Tennessee Valley Authority (TVA) has committed to about 2.4 GW of solar installations, with about 1 GW currently operating.

While solar is historically not a large part of TVA’s generation mix, it now represents over half of the projects awaiting approval in its grid interconnection queue. Of the nearly 30 GW of projects awaiting approval, 34% are solar, 20% are solar and storage hybrid projects.

The RE+ panelists said land-use issues are becoming a major focal point for solar development in the Tennessee valley. Other major policy developments have centered around FERC 2023 interconnection, issues with project origination, RFP processes, and power purchase agreement terms, valuation of battery energy storage systems, NEPA reform and the establishment of virtual power plants.

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