Production of photovoltaics jumped to 3,800 MW worldwide in 2007, increasing an estimated 50% over 2006. According to preliminary data compiled by the Earth Policy Institute, cumulative global production stood at 12,400 MW at the end of the year.
Japan, China, Germany, Taiwan and the U.S. represent the top five PV-producing countries, the institute says, adding that the U.S. is the global leader in thin-film PV. Overall, thin film grew from 4% of the market in 2003 to 7% in 2006. The Earth Policy Institute anticipates that thin film could claim 20% of the market by 2010.
Growth in China is also notable, the institute says. After almost tripling its PV production in 2006, it is believed to have more than doubled output in 2007. With more than 400 PV companies, China's market share has grown from 1% in 2003 to over 18% today. Having eclipsed Germany in 2007 to take the number two spot, China is now on track to become the number-one PV producer in 2008.
However, despite strong domestic production, domestic installations in China have lagged the market. For instance, China installed only 25 MW of PV in 2006, the institute says.
Germany, on the other hand, has been the leading market for PV installations since it overtook Japan in 2004, according to the Earth Policy Institute. In 2006, Germany added 1,050 MW, becoming the first country to install more than 1 GW in a single year. Driven by a feed-in tariff that guarantees the price a utility must pay homeowners or private firms for PV-generated electricity, annual installations in Germany alone have exceeded those in all other countries combined since 2004.
Japan, the U.S., and Spain round out the top four markets, with 350, 141 and 70 MW installed in 2006, respectively. The growth in installations in the U.S. increased from 20% in 2005 to 31% in 2006, primarily driven by California and New Jersey. Other states, such as Maryland, have passed renewable portfolio standards that mandate a certain percentage of electricity generation from solar PV. Initial estimates for the U.S. as a whole, the institute notes, indicate that PV incentives helped to achieve a strong 83% growth rate in installations in 2007.
Among the world's PV manufacturers in 2007, Sharp (Japan), Q-Cells (Germany) and Suntech (China) claimed the top three positions. But after holding the top spot for more than six years, Sharp, hampered by limited access to polysilicon, is likely to post only 4% growth in production in 2007, the Earth Policy Institute says. However, Sharp's annual thin-film production capacity is on track to increase from 15 MW today to 1,000 MW per year in 2010.
Suntech, a relatively new firm started in 2001, was the fourth-largest PV manufacturer in 2006, eclipsing Kyocera in 2007 to take third place. In the first half of 2007, Suntech produced almost as much PV as it did in all of 2006.
U.S.-based First Solar moved into the top 15 global manufacturers in 2006 by producing 60 MW of cadmium telluride thin-film PV – triple its production in 2005. In the first half of 2007, First Solar entered the top 10 list, moving up five spots to number eight and continuing its trend as the fastest-growing PV manufacturing company in the world.
The average price for a PV module, excluding installation and other system costs, has dropped from almost $100 per watt in 1975 to less than $4 per watt at the end of 2006. With expanding polysilicon supplies, average PV prices are projected to drop to $2 per watt in 2010. For thin-film PV alone, production costs are expected to reach $1 per watt in 2010, at which point solar PV will become competitive with coal-fired electricity, the institute says.
Overall, PV production has been growing by an impressive average of 48% each year since 2002 – doubling every two years – making it the world's fastest-growing energy source.
