The solar energy industry has definitely felt the impact of the global financial crisis and the global market for solar power is expected to record zero growth in 2009. Nevertheless, experts from the private Swiss bank committed to sustainability, Bank Sarasin, report that there are signs of an imminent recovery.
Spain is forecast to be one of the first to recover because it remains an attractive location for the development of solar energy thanks to competitive solar technologies and electricity pricing which compensate for falling government subsidies to the sector. According to Bank Sarasin, "the first green shoots of recovery for the solar industry in Spain will come soon, especially as more concentrated solar power (CSP) plants are commissioned and photovoltaic projects are implemented".
CSP back on the agenda
Bank Sarasin’s report highlights that CSP plants are proving to be a viable low-cost technology for centralised electricity generation, providing an ideal entry point for electricity utilities looking to access solar energy. After a couple of years break, they were once again commissioned in 2008 for industrial scale-production of steam and electricity. As a result, a total of 415 MW is due to be installed by the end of 2009 and 2,200 MW of CSP capacity is forecast for 2010, with over 40% of the installations taking place in Spain.
The CSP industry is also receiving a boost from the implementation of large-scale projects, such as Desertec in the Sahara.
Spain, Italy and South Africa top PV markets
The PV sector worldwide is currently undergoing signigicant changes. Having experienced a record year in 2008, it has subsequently faced the financial crisis, recession, falling oil prices and growing surplus capacity. Despite these factors, Bank Sarasin’s experts have identified several attractive markets for 2010 for large-scale PV plants over 1 MW with Spain, Italy and South Africa ranking highest.
Spain’s photovoltaic market, the world’s largest in 2008, experienced a major setback due to the amendment to Royal Decree 1578/2008 in September 2008 which means that the allocation process for photovoltaic plants now takes place on a quarterly basis. This means that plants which will receive the feed-in tariff in the first round remain unknown until three months after registration. Nevertheless, with an annual degression rate of up to 10%, Bank Sarasin’s experts anticipate that in the coming years the cap of 500 MW will be reached and that Spain will be one of the first countries where PV projects will be implemented without any government subsidies.
In the PV industry, Bank Sarasin reports that the most important factors driving the recovery are cost savings, lower module prices, efficiency improvements and the expansion of marketing channels. The growth rate for the global PV market is already expected to reach 46% in 2010, which corresponds to newly installed PV capacity of 8.5 GW. Annual growth rates for the period up to 2012 are between 45 and 50%.
Non-European markets are expected to achieve higher than average growth: China above 130%, and India and the USA both in the region of 100% per annum. Europe’s growth over the same period should be around 14%. One guarantee for stable growth is the fact that in addition to the pioneer markets, at least ten new PV markets with an annual volume of 500 MW will emerge in the next two years. "This will help solar energy wean itself off state subsidy programmes and at the same time soon achieve grid parity," concludes Bank Sarasin.
Based on economic arguments and the associated favourable prospects for the PV industry, Bank Sarasin predicts that the global market volume will expand to 155 GW by 2020. Its long-term forecast is therefore slightly more optimistic than the politically-driven scenario put forward by the EPIA (European PV Industry Association). This projection is not based on the prospect of greater political support, but is founded on the growing economic arguments in favour of solar energy.
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