(Bloomberg) -- Plunging solar panel prices may threaten plans for new US factories despite the sector’s recent explosive growth, a new report warns.

Solar module manufacturing capacity in the US nearly doubled in 2023, from 8.5 gigawatts to 16.1 gigawatts, according to the report from Wood Mackenzie and the Solar Energy Industries Association. But prices tumbled, with the cost of two-sided modules dropping 31%. 

Low prices, combined with economic uncertainty, “could make it difficult for US manufacturers to follow through on announced facilities,” the report says. The authors also point to the political risk posed by the upcoming presidential election, in which President Joe Biden, who has championed federal spending on renewable power, will likely face former President Donald Trump, who has opposed it.

Those risks come even as solar installations in the US set records. For the first time, solar power last year accounted for more than 50% of new electricity capacity added to the US grid, according to the report. Solar deployments surged 51% from 2022, to hit 32.4 gigawatts. One gigawatt can power about 750,000 homes.

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