If you're an energy investor, you've undoubtedly had your eye on solar. But there's one major sign that solar is scaling at unprecedented rates. Here's what you need to watch.
Solar's secret signal
Megawatts, regulatory approvals, installation costs, percentage capacity, dollars-per-Killowatt hour...they're all important indicators. But each one catches just one part of a much larger market puzzle. While you should watch these signs, there's an easier signal for solar's stellar growth.
An often overlooked indicator, solar industry employment shows astonishing growth in the last year. Employment serves as a backbone indicator for much of the economy -- and solar is no different. Human capital is a logistical nightmare and notoriously costly, so if businesses are hiring, it means they expect sustainable sales to keep growth going.
The Solar Foundation released its 2013 National Solar Jobs Census this week, showing that employment soared 19.9% to 142,698 in the past year. That's ten times faster than the national average employment rate.
Installers added the most workers, up 12,500 (22%) in the last year. SolarCity (NASDAQ:SCTY) is set to make 2013 another growth year, as well: "SolarCity has added more than 2,000 jobs since the beginning of 2013; every single one in the United States. When you install a solar panel you create a local job that can't be outsourced," said SolarCity CEO Lyndon Rive in a statement. "More than 90 percent of Americans believe we should be using more solar, and fewer than one percent have it today. We've barely begun this transformation, but as it advances, the American solar industry has the potential to be one of the greatest job creators this country has ever seen."
And while SolarCity keep its in-house operations limited to 14 states with 31 operation centers, SunPower Corporation (NASDAQ:SPWR) has pushed employment beyond its own payroll. SunPower Corporation itself employs 1,000 people in 10 states and is "actively hiring hundreds more," but its dealers represent the real scale of solar. According to SunPower CEO Tom Werner, its 400 dealers employ more than 6,000 Americans. Werner calls solar nothing less than a "competitive, reliable resource, and an economic success story for America."
A solar success story
While the economic recovery continues its slow grind, some states have seen solar employment soar. North Carolina shot up three places in solar capacity ranking to snag second place behind California. North Carolina's overall unemployment dropped faster than any other state in the last year, and the NC Clean Energy Industry Census puts clean energy employment up 20% to 18,404 workers in 2013. By the Census count, there are 240 solar businesses spread throughout the state.
But perhaps North Carolina's biggest solar win came in December, when regulators approved Duke Energy Corporation's (NYSE:DUK) Green Source Rider program. The legislation essentially allows Duke Energy Corporation's corporate customers the option of paying more to ensure their electricity demand is met with renewable energy supply. There are currently more than 2,000 MW of utility-scale solar projects in the proposal stage, meaning major growth opportunities for both Duke Energy and North Carolinians.
Google (NASDAQ:GOOGL) has a goal of 100% renewable energy sourcing, and worked closely with Duke Energy to make its proposal a reality. Here's a video explaining exactly how Google can buy solar power from utilities like Duke Energy.
The company has poured $1 billion into 16 wind and solar investments, and it's still got a long way to go before reaching total renewables use. Google is currently doubling the size of its Lenoir, North Carolina data center, and solar energy could be a major part of the company's new electricity supply.
Follow the footsteps
Solar employment expanded rapidly in 2013, and 2014 looks to be bigger than ever. The Solar Foundation expects its industry to add on another 164,938 jobs this year for a 15% growth rate. With companies continuing to scale, now is the perfect time to grab your piece of a growing profit pie.
Justin Loiseau owns shares of Google. The Motley Fool recommends Google and SolarCity. The Motley Fool owns shares of Google and SolarCity. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.