Even with all direct subsidies subsiding by 2018, BNEF is predicting solar to become the largest target for energy investment through 2040. Some 3.4 TW of solar will be added to global electricity grids, with an almost even split between utility scale and rooftop, with 1.8 TW and 1.7 TW each respectively.
BNEF predicts rooftop PV to drive growth in markets such as the U.S. and Europe, while in non-OECD countries utility scale solar will remain important where growing electricity demand is a major driver.
The NEO predicts some 1,489 GW of PV power plants to be added in non-OECD countries through to 2040, while only 787 GW of small scale, largely, rooftop arrays. This ratio is largely inverted for OECD countries with 373 GW of big PV and 882 GW of rooftop to be realized.
Importantly, the NEO makes its predictions for solar deployment the context of a largely unsubsidized solar sector. It argues that economics rather than policy will drive solar deployment beyond 2018 a condition factored into its market predictions. BNEF expects net metering to be phased out by the end of 2017, with storage being adopted in large scales around 2025, to optimize self consumption.
Falling investment, electricity share
Despite the predictions for massive deployment of solar globally, BNEF expects solar investment to decouple somewhat from installation figures. This is largely as a result of falling prices, and therefore reduced capex required for new capacity.
BNEF still expects the global solar market to grow to $91 billion in 2015 to $109 billion in 2020. By 2040, the OEM predicts the global solar market to reap $179 billion in revenues.
Turning to the contribution of electricity supply, the OEM sees just 14% of global electricity to be produced by solar in 2040. The geographical breakdown sees India leading with 20%, Europe 19.5%, the U.S. 14%, the Middle East and Africa 18%, and China and Japan 14% each. Of the European markets, BNEF has Germany sourcing 22% of its electricity from solar, and the UK 24%.
The NEO is compiled with data and input from 65 BNEF market and technology analysts in 11 countries. It is available here.