Best and Worst States Ranked for Solar Industry Growth

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Solar energy grew dramatically in the U.S. in the past decade while the cost of solar panels dropped by more than 50%. According to the Solar Energy Industries Association (SEIA), the U.S. has over 4.2 million solar energy systems, equal to 149.5 gigawatts of solar installations. The solar industry also provides jobs to over 255,000 Americans, a number expected to rise quickly in the next few years.

Many states are racing to expand their solar markets, with billions allocated toward solar investments. Keep reading to find the top five states for solar in 2023, according to the SEIA. We’ll also outline which five states have had the least progress, so you can discover where the solar industry is thriving and which states need more investment and policies to support solar growth.

1. California

California ranks as the top state for solar by a wide margin. And it’s no surprise since the Golden State enjoys almost 300 sunny and partly sunny days per year. Solar is a booming business in California, where more than $90.6 billion has been invested in solar generation. The state also provides generous tax incentives and property tax exemptions for residents who add solar panels to their homes. Over 11 million homes in the state are already powered by solar, and more than a quarter of the state’s electricity comes from solar production.

2. Texas

Texas, a state known for having its own power grid, is next on the list of top solar states. Texas’s total solar energy investment is $21.9 billion, and solar powers over 2.1 million homes across the Lone Star State. Texas and California account for about 21% of the U.S. population, meaning many U.S. homeowners have already gone solar. Texas gets about 4.9% of its electricity from solar. With 617 solar companies operating in the state, there is plenty of potential for added growth in solar energy.

3. Florida

It’s no surprise the Sunshine State is among the top five for solar power production. Florida has invested $16.3 billion in solar energy, and almost 6% of the state’s electricity comes from solar. Solar in Florida is still on the uphill climb to max out its potential, already powering almost 1.4 million homes, thanks to work from 461 solar companies. Although some of its solar policies lag behind many other top solar states, the industry is expected to continue growing in years to come.

4. North Carolina

Solar in North Carolina has expanded rapidly in recent years. From 2022 to 2023, the state jumped from 14th to 4th in the country for solar energy generation. North Carolina has invested $11.3 billion towards solar. Much of its growth comes from the state’s strong regulatory policies and Renewable Energy Portfolio Standard (REPS). With 240 solar companies operating in the state, residents and businesses have plenty of options to choose from when going solar.

5. Arizona

Arizona receives abundant sunlight and is an ideal place for a booming solar industry. The state has steadily grown its solar production, despite conflicts in the market regarding incentives and public debate about solar. Arizona has funded $16.5 billion towards solar and is still expected to rapidly grow its solar installations despite ongoing discourse. The state’s 368 solar companies provide a competitive market for solar customers to benefit from when shopping for an installer.

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1. North Dakota

North Dakota experiences half as many sunny days as California, one stumbling block for why it’s last on this list. Just .01% of the state’s electricity is generated by solar, with a dismal 195 homes powered in some way by solar power. Only eight solar companies operate in the state, so it has a long path ahead for adding renewable energy and solar power. However, the SEIA projects 606 MW of solar installations over the next five years. 

2. South Dakota

South Dakota beats its neighbor to the north by the thinnest of margins. The Mount Rushmore State now has 14 solar companies, but only .02% of its electricity comes from solar power. This electricity is enough to power 270 homes. The state’s investment in solar power is just $6 million, far less than the $49 million invested by the next worst state for solar, Alaska.

3. Alaska

Alaska ranks third from the bottom in solar generation. Its $49 million investment in solar is significant, but solar generation in the state still remains low. Only .23% of the state’s electricity is sourced by solar. Alaska, one of the cloudiest states in the U.S., is also limited by its seasons. Cities such as Anchorage bathe in sunlight all summer, a big positive for solar, with 19 hours of sunshine each day. However, the state spends most winter months in near-darkness, reducing solar production to near zero. 

4. West Virginia

West Virginia has installed a mere 31 MW of solar thus far, with just 19 solar companies operating in the state. The SEIA does not predict huge growth for solar in West Virginia in the coming years, and only .06% of the state’s energy comes from solar. The slow adoption of solar in West Virginia could be attributed to the fact that the state is the second highest producer of coal in the U.S.

5. Nebraska

Nebraska is another state with very little solar energy growth in recent years. It only has enough solar installed to power 10,090 homes, with just 0.30% of the state’s electricity coming from solar. However, Nebraska has a larger growth expectation, with the SEIA anticipating 1,548 more MW of solar in the next five years. This would boost the state’s ranking from 47th to 32nd.