Global solar PV market set to reach 500GW by 2018 | RenewEconomy

Global solar PV market set to reach 500GW by 2018

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Report predicts global solar PV capacity of 500GW by 2018, after a growth spurt that will see solar compete directly with traditional forms of energy.

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The global solar PV industry is headed into a five-year growth spurt that will put it on track for cumulative installed capacity of 500 gigawatts (GW) by 2018, according to the latest NPD Solarbuzz Marketbuzz report.

The report, released on Thursday, predicts a huge 100GW of solar PV deployment will be targeted in 2018 – a boom in end-market growth that is projected to increase annual PV module revenues to $50 billion in that same year.

In January, leading investment house Deutsche Bank also dramatically lifted its near-term demand forecasts for the global solar industry, predicting that 46GW of PV would be installed across the world in 2014, and 56GW in 2015.

Last year, PV developers installed 37.5GW of panels worldwide – a 22 per cent increase on 2012, despite the lingering hangover of global overcapacity and declining operating margins. According to data compiled by Bloomberg, that figure may increase as much as 39 per cent this year, as surging demand in China helps to soak up the glut.

China, which surpassed Germany to become the world’s biggest solar market in 2013, has been forecast to install more than 14GW in 2014, after adding a record 12GW of solar power in 2013, compared with 3.6GW a year ago, according to Bloomberg New Energy Finance.

NPD SolarBuzz says it also expects this strong demand to further stimulate revenues for the industry’s manufacturers, with PV module revenues of more than $200 billion available over the five year period from 2014 to 2018.

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“Solar PV module prices declined faster than the end-market grew in 2012, leading to a dramatic decline in revenues,” said Michael Barker, senior analyst at NPD Solarbuzz. “This imbalance was corrected during 2013. Over the next five years, end-market growth will exceed forecasted price declines, resulting in a strong rebound in module revenues.”

The average price of PV modules is also expected to decline moderately, according to NPD SolarBuzz, falling to $0.51 per watt (W) in 2018. System prices, too, will decline each year, driven by cost reductions in balance-of-systems components and economy-of-scale improvements enabled by project developers and installers, says the report.

“Solar PV suppliers are benefiting from a less volatile pricing environment, compared to previous years,” said Finlay Colville, vice-president of NPD Solarbuzz. “The industry will soon transition to a phase of profitable growth, with solar PV competing directly with traditional forms of energy.”

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  1. Chris Drongers 6 years ago

    The effect on world coal consumption will start to be significant soon (‘significant’ is a qualitative level – to a coal CEO paying a company dividend, any reduction in coal revenue comes straight off the profit and dividend and ultimately the CEO’s KPIs).

    At half a tonne of coal per MWhr

    an annual installation of 100GW of PV each year displaces around 100,000,000 tonnes of coal a year (100,000MW x 0.5t coal/MWhr x 2000 sun hours/year, the roundings more or less cancel out as efficiencies and sites vary). By 2018 there will be 500GW of solar in place displacing 500M tonnes of coal a year and reducing CO2 emmissions by over 1Gt/year.

    Continued growth in solar installation rates will accelerate the displacement of coal year-on-year. 100GW of PV is equivalent to about 34TWhr of electricity (100GWpv x 17% capacity factor x 2000 sun hours/year) which is just under 20% of the Australian NEM annual electricity sales (200TWhr/yr). World cumulative PV installations by 2018 would save five times the Australian electricity sector’s annual CO2 emissions (200Mt CO2 equivalent in 2013).

    Add in consumers in Africa and third-world Asia that will never get electricity by burning coal and the effective reduction in global emissions is worthwhile.

    • David Osmond 6 years ago

      exciting days Chris.
      ps. I think you double counted the capacity factor in the 2nd calculation. The number of sun hours per year should already incorporate the capacity factor (ie, CF=17% implies 1500 sun hours/yr).
      So 100GW of PV should generate about 149 TWh/yr assuming CF=17%.
      As another example, my 2.15 kW system currently generates 3.2 MWh/y, implying a CF of 17%.

      • Chris Drongers 6 years ago

        Correct on the capacity factor, thanks David.

        The 100GWpv expected to be installed annually over the globe by 2018 would produce roughly 150TWhr of solar electricity which is very close to replacing the entire Australain eastern states traded electricity volume each year. This is equivalent to about 150Mt CO2 equivalent or about 75Mt coal equivalent.

        • sean 6 years ago

          Hate to be a party pooper, but solar is more likely to be offsetting use of petrofuels, (as they are the most expensive) rather than coal.

          • Bob_Wallace 6 years ago

            Coal needs to run 24 hours a day. It can’t turn on for an hour or two when prices are high and then shut down.

            Solar will crash the daytime price of electricity, as it has in Germany. Look at the pre- and post-solar wholesale price graphs below.

            Wind will crash the nighttime price of electricity as it has in parts of the US.

            This leaves coal few hours to make the profits it needs in order to live with losses when the Sun is shining or the wind blowing. As more storage is developed coal will lose its ability to sell for enough profit to stay in business.

            The black stuff is doomed….

          • sean 6 years ago

            Just like the trumpeting of the costs of cheap storage by using thermal solar, coal will redesign to make use of stranded capital. Necessity is the mother of invention. adjustments will be made to store steam and the coal bandwagon will roll on.

            whilst i am very happy with the success of PV and wind, there are huge markets in synthetic petrofuels which will have to be satiated before we can wipe out coal on economics alone.

            i feel the only way to rid ourselves of its grasp is to legislate.

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