One of the more interesting graphs we saw at the Australian Energy Storage conference in Sydney last week was this presented at the APVI side-event by Warwick Johnston, from Australia’s leading solar market consultant Sunwiz.
There are a couple of interesting points to be made. One is that, since a peak in the middle of 2012 – when households rushed to pick up the remaining state-based premium feed-in tariffs – the solar market has been in decline, but has not disappeared.
The black line represents the moving average of monthly capacity installations. The solar PV market is still running at around 60MW a month, or 720MW a year, but the share of commercial solar, particularly in the 10kW to 30W market and the 30kW to 100kW market is growing.
That means that residential solar, which was running at more than 90MW a month in the premium FiT heyday, is now running at no more than 45MW a month.
But will the decline in residential solar PV installations continue? Bloomberg New Energy Finance has taken a look to the future, and has provided a breakdown of the driving forces that will influence installations in coming years. BNEF’s graph is below.
Like SunWiz, BNEF says the commercial market will grow in importance, accounting for around one-third or more of new annual installations, as the overall market jumps from 4.2GW now, to more than 15GW by 2030.
One of the reasons the market may rebound is the interest of the big retailers, who are suddenly jumping on the rooftop solar market in a belated response to shift to distributed energy.
All the major retailers are offering various forms of finance, including power purchase agreements. Among the most striking is Origin Energy’s offer of an 11c/kWh. That means that Origin owns the system, sells the output to the consumer for 11c/kWh, and locks the customer in for a period of seven years or more.
They want to do this because it removes “churn”, the tendency for customers to shop around every few years for a better deal. And they are able to do this because of their balance sheet and buying power, and their ability to source low-cost debt. And analysts say that they are still making handsome returns.