Global Solar Outlook: Demand Will Transition To New Regions


Solar photovoltaic (PV) demand will increase 31 GW during 2013, up 7% year-over-year (Y/Y), according to the new NPD Solarbuzz Marketbuzz 2013. For the first time, China will outpace Germany to become the leading PV consumer, while the top 10 PV territories will still account for 83% of global PV demand.

‘2013 will represent another transition year, as the PV industry adjusts to softness across legacy European markets,’ says Michael Barker, senior analyst at NPD Solarbuzz. ‘The Chinese end market will largely compensate for the downturn in demand from Germany, which previously led PV demand.’

Due to further reductions in European premium incentives, demand in this region will fall to approximately 12 GW, which is a 26% Y/Y decline. In contrast, new policies across leading PV countries in the Asia-Pacific region, led by China, Japan and India, will stimulate regional growth of over 50% and account for more than 11 GW of PV demand in 2013.

‘In 2013, we expect to see improvement in the market fundamentals that enable PV demand to return to double-digit growth,’ Barker says. ‘Installed-system prices will continue to fall, and PV will become increasingly cost competitive across regions with high electricity rates, shortages in domestic supply and growing renewable obligations to fulfill.’

New PV opportunities from the Middle East, Africa, Latin America, Southeast Asia, the Caribbean and other emerging regions will have a stronger impact on global demand from 2014 onward. According to the report, emerging regions are forecast to account for less than 8% of global demand during 2013.

However, this market share is expected to double by 2017, driven primarily by South Africa, Saudi Arabia, Thailand, Israel and Mexico.
Further fragmentation of the supply chain for PV modules and balance-of-system components is expected across a range of addressable markets due to shifts in geographic access, new and ongoing import trade barriers, and changes in PV application segments, NPD Solarbuzz says.

‘Global trade wars and excessive local manufacturing capacity levels will create micro-environments for PV supply and demand, with each PV supplier serving only a subset of the 31 GW demand total,’ Barker said.

Ground-mount installations will dominate the market in 2013, with 45% of PV demand. These installations are being driven by policies that favor utility-based deployment, the report explains.

Strongly influenced by Japan, Germany, Australia, Italy and the U.K., overall market share for residential PV in 2013 will remain above 20%. These five countries will account for three-quarters of all residential PV installations this year. According to NPD Solarbuzz, this trend highlights a broad geographic pull and emphasizes the continued importance of distributed generation.

Graphic source: NPD Solarbuzz

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