New Hampshire, U.S.A. — Asia-Pacific markets together added 2.8-gigawatts (GW) of solar PV installations in 4Q11 on the way to a total of 6GW for the entire year, an eye-popping 165% growth, thanks in large part to a massive run-up in China’s domestic sector, according to calculations from Solarbuzz.
China, which now dominates the regional solar market (not to mention conversations about alleged anticompetitive practices), saw its solar PV capacity skyrocket 500 percent in 2011 — roughly 1GW of ground-mount projects in the Qinghai province alone. A planned year-end 13 percent FiT reduction created a 1.7GW surge in installations in 4Q11 (much like what happened in Germany), helped by lower module prices and favorable project returns. The country now makes up almost half (48 percent) of Asia’s entire solar demand, and its solar PV project pipeline has swelled to 20GW, though the Chinese central government could well step in with policy adjustments to reign in that growth in 2012, notes NPD Solarbuzz analyst Ray Lian. (Still, China could end up passing Germany as the biggest new-PV-capacity country in 2012.)
Asia’s next-largest solar PV market, Japan, grew 30 percent year-over-year to 1.2GW, but with only a slightly higher install rate in 4Q11, heavily slanted (70 percent share) to residential installs. A new FiT law hoped to spur large-scale PV projects is imminent and spurring development activity, but the legislation’s lack of clarity has held back actual project implementation. Also shaping Japan’s end market is a “dramatic” influx of foreign module suppliers. Look for Japan’s end market to accelerate slightly in 2012, to 40 percent growth Y/Y, says Solarbuzz.
Also flexing its solar PV muscles is India, seen as a potentially massive solar PV end market (just ask First Solar) thanks largely to its nationwide support via the National Solar Mission and state-level policies (e.g. in Gujarat). PV installs in India more than doubled in 4Q11 (125 percent) due to, as in other areas, a race to beat turn-of-the-calendar installation deadlines. Rapid PV price declines in 2011 drastically changed the economics for many Indian solar PV projects, though, so many projects have been delayed (Gujarat projects, for example, got a one-month extension) to figure out financial closure, land acquisition, and power evacuation facility issues, notes Solarbuzz analyst Chris Sunsong. Developers are now scrambling to meet installation deadlines or risk losing their PPAs — meaning that there will be a flurry of activity through January — more than 600MW in solar PV projects might get grid-connected in 1Q12. Look for India to approach 1GW for all of 2012, he says.
Other emerging markets in Asia — mainly Thailand, Korea, and Taiwan — contributed 500MW of demand in 2011, and should add 50 percent to that in 2012 joined by Malaysia and the Philippines, says Solarbuzz.
One market in Asia isn’t faring as well: Australia, the region’s third-largest PV market, actually saw installations drop -10 percent in 4Q11, and Solarbuzz expects another -20 percent decline in 1Q12 and -30 percent for all of 2012, following the reduction and elimination of early-year incentive policies “has left many downstream installers stranded with evaporating demand and many firms have ceased operations.” (Note that an influx of lower-priced Chinese modules, which lowered overall system costs, also hastened the demise of domestic module maker Silex Solar during 4Q11, though the company is technically calling it a suspension into “care and maintenance mode.”) The market should kick in again in 2013 as large-scale ground-mount projects come online, says Solarbuzz.
Asia Pacific solar PV market demand by region in 2011. (Source: Solarbuzz)