In a new research report, Maxim analyst Aaron Chew discusses where (he thinks) all major regions finished with 2011 solar PV installations, and where he sees them pushing ahead in 2012 and beyond.
January 17, 2012 – In a new research report, Maxim analyst Aaron Chew predicts an “upside surprise” of 30GW in 2012 solar PV installations, citing probably sub-$1/W module prices with some elasticity in key subsidized markets, and even grid parity reached in some markets, and as new markets emerge in Asia, Africa, and Latin America. (Note that he pegs 2011 PV installs at 20GW-23GW, somewhat lower than IMS Research’s 26GW, so his 30GW total implies a good deal more growth.)
Here’s his datadump table showing where (he thinks) all major regions finished 2011, and where he sees them pushing ahead in 2012 and beyond:
Figure 1: Global solar PV demand poised to approach 30GW in 2012 and 50GW in 2014. (Source: Bundesnetzagentur, DECC, GSE, SEIA, Japan Photovoltaic Energy Association, China National Development and Reform Commission, Solar Business and the Australian PV Association, Enerplan, Ontario Energy Board, Ofgem, Hellenic Association of PV Companies, ERU, and Maxim Group Estimates)
Some of Chew’s analysis and predictions for particular regions:
— Germany moving down: Subsidy cuts over the past year in Germany (-26%) and Italy (-50% or greater) have been equaled by module ASP declines -40% to -50%), keeping project economics attractive. At $1/W, German projects can hit 7% IRRs, and ?0.12/kWh ($0.15/kWh) energy generation without subsidies. But expectations of subsidy revisions could cause a rush in 1H12 demand, and with the threat of steeper FiT cuts (-40% to -50%), a project cap (3kW) and/or hard cap by July, he thinks Germany’s PV installs could plunge -33% to 5GW in 2012. That opens the door for…
— China moving up: Say hello to the planet’s new PV market leader in 2012, says Chew — with 5.5GW installed it would surpass Germany, thanks to demand building off its new FiT, low balance-of-system costs, and maturing finance markets.
— Other regions waning: Italy is still 2.5GW away from its ?6B annual spending target, at which point it could very well kill its FiT program; Chew sees demand falling 3GW Y/Y. He also sees “severe subsidy cuts” in the UK and Australia, pulling demand down another 1GW.
— New markets arise: A major theme in 2012 will be the emergence of various new markets. Chew calls out contributions from India and Japan (5GW), Thailand and Malaysia thanks to new FiTs (2.5GW), Latin America Peru-Chile-Argentina-Caribbean (“hundreds of MWs” each), and Africa now on the map led by South Africa and Morocco.
— Undecided US? The US could add another 2.5GW (35% growth), according to Chew, but he thinks there’s more downside than upside, for three reasons: cash grant’s reversion to a tax credit, the CASE-CASM trade dispute with China likely ending in a tariff, and low PPA/SREC prices as utilities meet their RPS requirements.
— No love for manufacturers. Note that even with demand upside in 2012, Chew sees solar PV cell/wafer (over)supplies at around 40GW. And at $1/W pricing, there’s little to no room for any profitability among manufacturers; look for more EPS losses, he predicts.
