While subsidy cuts are predicted see photovoltaic demand fall away in established markets such as Germany, increasing activity in emerging markets have held some hope for the photovoltaic industry. This trend has been quantified in a new study, the "IHS Emerging Markets Study," which was released today.
Analyzing the potential for photovoltaic market development in 40 countries, the report has found that annual demand could increase from 1.6 GW p.a. to up to 12 GW p.a. from the emerging markets by 2017. The forecast for 2013, set out in the report, is between 2.1 and 3.5 GW p.a., growing to between the extremely wide span of 2.9 to 12.2 GW p.a.
The IHS report specifies that South Africa, Thailand, Chile, Romania and Brazil are the "most appealing" emerging markets, followed by "tier 2" markets Argentina, Ecuador, Turkey and Mexico. While the outlook for photovoltaic growth in these countries is good, IHS notes that there are risks in companies looking to expand into them.
Key drivers of the growth in the emerging markets, as identified by IHS, are the heavy reliance on fossil fuels for power generation in Africa and the Middle East, and how 26% electricity demand will mean that subsidies for these fuels will no longer be possible in 2017. Renewable Energy Standards (RES) requirements are signaled to be the big driver in emerging European markets, while Turkey may employ photovoltaics to "ease its surging power demand."
India is seen to have the highest mid-term market potential, driven by high industrial prices and power shortages. A heavy reliance for oil for electricity production in Southeast Asia and Latin America is indicated as being behind photovoltaic development in these regions.
In terms of the planning of photovoltaic projects, IHS has identified 20 GW in development, with 14 GW in the pipeline stage. However it notes that "notoriously slow approval and implementation processes" means that les than 1 GW of this is currently under construction.
Of this pipeline the 1 GW project, proposed by Securum Equity Partners, in Serbia is noted however IHS cautions, "whether the project is fully completed remains to be seen."