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Global Solar Installation Growth Steady in 2014

Global photovoltaic (PV) installations are forecast to rise at the fastest pace in three years in 2014, exceeding 40 GW for the first time and generating installation revenue of more than $86 billion, according to IHS. Annual solar installations are predicted to expand at a rate of 18 percent in 2014, reaching 41 GW and firmly marking the end of the solar industry’s two-year slowdown. This means that the total global PV capacity will exceed 175 GW by 2014

PV installations will accelerate in 2014 driven by low system prices, the creation of new markets in emerging regions and the continued growth in major countries such as the United States, Japan and China. As the industry’s recovery accelerates and market revenue returns to near record levels, solar manufacturers will leave behind the turmoil of recent years and enjoy improved business conditions. 

The acceleration in demand has already begun in 2013, IHS predicts that the fourth quarter of 2013 will close the year strongly, with the highest number of quarterly installations in two years. IHS forecasts 9.8 GW worth of PV installations will be completed during the fourth quarter, compared to 8.5 GW in the second and third quarters and to 7.0 GW in the first quarter. The robust performance in the fourth quarter conforms to the industry’s seasonal pattern of a solid finish every year. The surge in installations in the fourth quarter is driven by incentive cuts that go into effect at the end of each year. Individuals and organizations typically rush to complete their solar projects while government subsidies are still in force. China will be the primary driver of this year-end rush, with more than 2 GW of installations projected to be completed in the fourth quarter of 2013.

The growth in the developing PV nations will more than offset the poor conditions in the large, well-established solar markets. Although European installations will return to growth in 2014, Europe’s share of global installations will continue to slide as it is outpaced by Asia and the Americas. Europe’s share will fall to 29 percent next year, down from 57 percent in 2012. Meanwhile, Asia’s share will increase to 48 percent, up from 29 percent.

Source: IHS

China Could Install 15 GW in 2014

While 2013 demand in China is likely to fall short of the targeted 10 GW annual run-rate, it is anticipated that 2014 demand will significantly exceed these levels, with installations potentially reaching 13-15 GW run-rate in 2014 compared to 6-7 GW run-rate in 2013. Chinese solar market to continue to exceed expectations for a number of reasons. First, the current state of solar sector in China reminds us of the past growth/development phase of several European solar markets such as Spain, Italy, Germany. Just like in the case of European solar sector, Chinese solar demand growth is currently driven by attractive project internal rate of returns (IRRs) resulting from recently announced feed-in-tariffs (FiT).

Source: Deutsche Bank

Recreated from original blog post authored by Nilesh Y. Jadhav at Solarika.org

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