Report: Solar Scores Big Gains in Electricity Generation

Solar energy powering the nation's homes and businesses has grown 600 percent since 2008.

The Nevada Solar One solar power plant located near Boulder City, Nevada.

Solar energy continues to grow, accounting for all new utility electricity generation capacity added to the grid in March.

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Despite the buzz surrounding natural gas and its increased role in electricity generation, solar seems to be increasingly stealing the spotlight from the newly famous fossil fuel.

Thanks to new projects across the country, solar energy accounted for all new utility electricity generation capacity added to the grid for the first time in March, according to the Federal Energy Regulatory Commission's (FERC) Energy Infrastructure Update. All other energy sources combined added no new generation capacity, the report noted.

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Since 2008, the amount of solar energy powering U.S. homes, businesses and military bases has grown by more than 600 percent according to the Solar Energy Industries Association. In 2012 alone, the United States brought more new solar capacity online than in the three prior years combined, underscoring projections that solar will be the nation's largest new source of energy over the next four years.

Momentum behind the development of more renewable energy is mounting, too. According to a recent poll conducted by Gallup, three-quarters of Americans support increased solar energy use and 71 percent favor pursuing more wind energy.

"These new numbers from FERC support our forecast that solar will continue a pattern of growth in 2013," Rhone Resch, president and CEO of the Solar Energy Industries Association, said in a statement.

[PHOTOS: Florida's Next Generation Solar Energy Center]

The primary driver behind the advancement of utility-scale solar energy has been steeply declining equipment and installation costs, which have dropped nearly 40 percent during the past two years according Resch, making the renewable energy technology more affordable than ever.

Substantial cost reductions have also spurred innovation in the sector, with solar companies experimenting with new methods to provide solar powered electricity day or night, rain or shine. California-based firm SolarReserve's Crescent Dunes project in Nevada seeks to provide commercial-scale solar energy storage to eliminate one of the main criticisms of renewable energy technologies such as solar and wind: their intermittency.

"The facility includes 10 hours of highly efficient energy storage and can provide reliable and non-intermittent solar energy to 75,000 homes during peak periods, even after dark," says SolarReserve CEO Kevin Smith.

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But it's not just getting cheaper to set up massive solar installations in the middle of the desert. Costs are dropping for residential solar, too. Though a rooftop system will still set consumers back about $30,000, creative financing options from a growing set of solar start-ups is changing the landscape of the industry. Third-party-owned solar – also called solar power service – companies such as Sunrun and SolarCity, own, maintain and insure solar panels on a homeowner's roof eliminating the upfront cost hurdle for homeowners while still allowing them to enjoy the cost savings of switching to solar.

"This is a story of promises made, promises kept – as an industry we said if we put certain policies in place, we would be able to reduce costs and make solar more affordable for Americans," says Bryan Miller, Sunrun's vice president of public policy and power markets. "This report and others show we're doing that."

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