Global PV demand shifting due to regulatory changes

Having completed work on three new Regional Downstream PV Market reports, Solarbuzz has come to the conclusion that five leading Asian Pacific markets, led by Japan and India, will account for at least 26 percent of global photovoltaics demand by 2015. This is up from just 11 percent in 2010. The U.S.’ share meanwhile, will increase from five percent in 2010 to 14 percent in 2015.

Europe’s global photovoltaic grip, on the other hand, is projected to slip from 81 percent in 2010 to 65 percent this year and 53 percent in 2015. In stark contrast, from 2009 to 2010, Europe’s share increased by an impressive 170 percent.

The shifting demand, which has been much publicized since last year, is said to be primarily down to the frequent feed-in tariff and solar incentive changes in key European markets.

"Specifically," says a statement released by Solarbuzz, "European markets, led by Germany and Italy, have absorbed feed-in tariff (FIT) rate cuts of up to one-third between January 1, 2010 and July 1, 2011. These reductions have caused Q1’11 demand in Germany, the world’s largest PV market, to collapse to less than half of its Q1’10 size."

The policy changes have hit the ground-mount market the hardest. However, while rooftop photovoltaic tariff rates remained attractive across Europe, investor confidence in this sector, according to Solarbuzz, is only just starting to come back.

Huge pipelines

In addition to shifting photovoltaics demand, Solarbuzz states that the U.S., China and India have a 25 GW project pipeline. "Project development activity is intense in these countries," explains Craig Stevens, president of Solarbuzz. However, he adds that the projects will only be successfully executed if issues like permitting, financing and project structuring are overcome.

Asia

The reports also find that China’s photovoltaic industry performed particularly well last year, with its domestic market more than doubling in size. Ningxia and Jiangsu were named as the two largest provincial markets, and the utility segment was said to account for 49 percent of the country’s total photovoltaics industry.

Overall, China was the second biggest Asian Pacific photovoltaic market after a "rejuvenated" Japan. Solarbuzz reports that photovoltaics in Japan grew 111 percent year on year. As has been the trend in the country, residential demand is strongest, and accounts for a massive 82 percent of its overall market.

"Strong solar policy support already in place before the Fukushima nuclear disaster indicates that the Japanese market is projected to grow to between 1.3-1.5 GW in 2011," says Solarbuzz.