Spending in the U.S. dropped 41% from the second quarter of the year to just $5.5 billion, leading to an overall year-over-year decline of 20%. Cheap natural gas has diverted U.S. investment and lower subsidies in Germany and Spain coupled with a decline in Chinese spending on wind power are the main causes for the decline.
One bit of good news is that the installation of new solar photovoltaic systems is on track to set a record of 36,700 megawatts of new capacity in 2013. The rise in capacity comes at the expense of the solar PV industry where ever-falling prices offset the increases in new capacity.
Solar makers like First Solar Inc. (NASDAQ: FSLR) and SunPower Corp. (NASDAQ: SPWR) have come to depend on their project businesses to help offset the declining costs of solar modules. SolarCity Corp. (NASDAQ: SCTY) has recently made two acquisitions that increase their vertical integration in the solar installation market. For the moment at least, going vertical seems to be the path to whatever profits exist in the solar market.
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