The news continues to be positive for the solar industry worldwide in 2017, with installations surging to what will likely be a new record. But at the same time, solar energy in the U.S. might be undermined by a new report from the Department of Energy that wants to put more focus on coal and nuclear power. 

Here's a look at the biggest highlights from the solar industry this week. 

First Solar power plant with a transmission line in the background.

Image source: First Solar.

Grid report isn't very bullish on renewable energy

President Donald Trump's administration is starting to make its mark in the electricity industry, and it may not be very favorable to renewable energy. A grid report requested by Energy Secretary Rick Perry pushed for more coal and nuclear power (surprise, surprise) and asked the Federal Energy Regulatory Commission (FERC) to reform markets to favor those energy sources. The clear implication is that renewable energy would be put at a disadvantage on a federal level. 

What was a little surprising is that the report noted that natural gas is what has decimated coal and nuclear electricity generation in the U.S. And low growth in electricity demand hasn't helped either. Wind and solar power have had a negative impact on coal, for sure, but they weren't the main drivers of its decline. 

There's a little for everyone in this report, depending on your perspective, but for solar investors, the concern will be that markets will be built to advantage coal, nuclear, or natural gas over renewable energy. That could happen without much fanfare and could quietly be implemented by the Trump administration. Keep an eye out for "market reforms" or wholesale rate structure changes that are really bailouts for aging power plants that can't compete with wind or solar on cost alone. Those would happen at FERC or at the public utility commission level, which isn't typically well covered by the media and may not get much public attention.

China's solar market is booming

It's hard to overstate just how amazing China's solar boom is right now. According to the independent solar advisory firm AECEA, in the first half of 2017, China installed 24.4 GW of solar, or enough to power 4 million U.S. homes. In July alone, the country installed 10.52 GW, or enough to power 1.7 million U.S. homes. In a month, China nearly matched the U.S.'s installation record of 14.6 GW in 2016. 

China's installations will likely slow in the second half of the year because tariffs and other programs have been reduced, but the surge could lead to a much bigger year globally than expected. IHS Markit now expects 90 GW of solar installations worldwide this year, and we may be headed for our first ever 100 GW year in 2018. 

News and notes

Here are a few other notable news items from the week in solar. 

  • SunPower (NASDAQ:SPWR) announced this week that it is building a 10 MW solar power plant with a 1 MW energy storage system at Redstone Arsenal U.S. Army post in Alabama. This will be an Oasis power plant that tracks the sun throughout the day and will begin to display SunPower's solar-plus-energy-storage vision for the future. 
  • A week after First Solar (NASDAQ:FSLR) announced the sale of the 40 MW Cuyama Solar Project, it announced the sale of the 280 MW California Flats Solar Project to Capital Dynamics. Details weren't disclosed, but this project sale was a big reason management increased guidance for 2017
  • The government of Victoria in Australia announced a new tender auction for wind and solar energy capacity that will help meet renewable energy targets of 25% of the state's energy mix by 2020 and 40% by 2025. 

That's all for this week in solar. Check back to fool.com for more solar coverage next week. 

Travis Hoium owns shares of First Solar and SunPower. The Motley Fool recommends First Solar. The Motley Fool has a disclosure policy.