LONDON — Despite a very weak start to the year, IMS Research has recently increased its photovoltaics (PV) forecast for the full year by more than 1 GW and predicts that more than 22 GW of new PV capacity will be added in 2011. The research firm cited growing demand in all major markets, notably in Asia and the Americas, as well as a pick-up in the sluggish German market, and installations in the second half will be nearly double that seen in the first six months.
A Strong Second Half
IMS Research’s latest Global PV Demand report, which analyses installations rather than registrations or connections in more than 60 downstream markets, predicts that despite weak first and second quarters, demand will grow rapidly in the second half of 2011 due to rapidly falling module prices, incoming incentives in new markets, and planned end of year cuts in existing markets.
Senior research director Ash Sharma commented, “Although installations grew just 13 percent in Q2 from Q1 the results of our latest report show that there will be a huge surge in installations in the second half of the year. Several mid-sized markets like the USA are growing massively whilst markets like Germany and Italy are starting to pick up too.”
Europe Flat in 2011
According to the new report, several European markets, including Germany, are predicted to see a major slowdown or even a fall in 2011. However, Europe overall will be only one percent down this year due to geographic diversification, with high demand coming from a number of new countries such as Slovakia and the UK. The report revealed that 11 countries in Europe will install at least 100 MW this year, with 20 countries globally installing this amount or more – up from just 13 the previous year. This increasing diversity in the market is helping to support demand and provide stability to a market that was once dependent for growth on just one or two countries.
China is Key
One significant factor in IMS Research’s increased forecast is the recently introduced national feed-in tariff (FiT) in China, which was revealed by the National Development and Reform Commission (NDRC) in August. This FiT pays a premium for installations completed this year, but continues past the end of the year and is in addition to the country’s Golden Sun scheme. “We earlier predicted the introduction of a PV FiT in China once prices had fallen to an acceptable level and we’re forecasting installations of 1.3 GW this year and more than 2 GW in 2012,” commented Sharma. In the longer term, IMS projects that China will become a key player for PV – and not just for production, with the country becoming one of the top three markets in 2015.
Top 10 Markets in 2011
IMS Research has also updated and released its top 10 markets for 2011, and reveals that although Europe still dominates the global PV market, only four of the 10 most important markets in 2011 will be European, with Asian markets ranking prominently. “At the same time, it’s important to remember that Europe will still account for close to 70 percent of global installations this year and in fact the next five largest markets are all European,” added Sharma.
The 10 most important PV markets in 2011, according to IMS Research, will be:
With some notable changes in position, this result contrasts in several ways with IMS’s list of the 10 most important PV markets of last year:
- Czech Republic
While Germany and Italy hold their places this year at first and second respectively, the US – despite a slow start to the year – moves into third position, up from number four last year.
France loses a point, moving down to number six from fifth place last year. And Japan, where the government is aggressively expanding its solar targets in the wake of the Fukushima disaster, moves up from sixth to fifth.
Spain falls two slots, down from number seven in 2010 to number nine this year. This is largely as a result of the country’s reduced FiT, which came into effect in the second quarter of this year. Under the cuts, remuneration declined by eight percent to 28.88 euro cents (US$0.39) for smaller rooftop installations, by 27 percent to 20.37 euro cents (US$0.28) for larger rooftop systems and by 46.5 percent to 13.46 euro cents (US$0.18) for ground-mounted.
Australia moves up from last year’s number 10 to number seven this year, a significant jump. There is currently strong policy commitment to solar energy from the Australian government, most notably with its “Solar Cities” programme. Demand is also increasing in rural areas where connection to the grid may not be feasible.
India, which had failed to feature in the rankings last year, enters this year at a respectable number eight. The country’s thriving renewable energy sector and strong growth in PV manufacturing are supported by incentive packages, soft loans and the innovative Jawaharlal Nehru Solar Mission, which has set a target to achieve 20 GW of grid-connected solar power installed and on-line by 2020.
However, Belgium, number eight in 2010, falls off the chart entirely this year.
Canada – where the solar PV market in Ontario alone is forecast by ClearSky Advisors of Toronto to grow a whopping 270 percent by the end of this year, becoming the largest regional market in North America – enters the rankings at number 10.
The biggest leap forward for 2011, of course, is China’s jump from number nine last year to number four this year.
IMS is now also more optimistic about the mid-term future for the PV industry and has also raised its projections for 2012. “Despite many still predicting doom and gloom, our latest research presents a very different picture. The decision by the Chinese government to introduce a national FiT to boost flagging demand, as well as a diversifying global market and the introduction of new incentive schemes globally presents a much more optimistic, but still very challenging future for the industry,” concluded Sharma.