PV Market Share Forecast in 2010

Thanks to our good friends of Solarbuzz...

Twelve months ago, anticipating that the global photovoltaic (PV) industry would return to a demand-constrained market in 2009, Solarbuzz commenced a year-long project to analyze downstream PV markets around the world. Today, they released the results of that research in three reports that set out the activities and opportunities in each of the major photovoltaic markets around the world.

The suite of PV Market 2009 reports addresses the current status and future prospects for the European PV markets, the United States On-Grid PV Market and the Major Asian and Pacific PV markets. These three regions will account for 96% of global PV demand in 2010.

After extremely challenging industry conditions in 2009, characterized by excess manufacturing capacity and accentuated by a 2 GW demand reduction in Spain after a major policy adjustment, the PV industry will return to a growth path in 2010, resulting in a global market of 7.4 GW in that year, based on a mid-range scenario*. This is up from the 5.95 GW market in 2008.

Underpinning that growth will be a more than doubling of the US market size to well over 1 GW in 2010, together with a mid-range German market size of 3.2 GW.

Major global factory-gate module price reductions in the first half of 2009 have established the foundation for rapid demand growth in feed-in tariff driven European markets, in both 2009 and 2010. European country markets are characterized by wide variation in customer and application segments as well as differing barriers to market development. Germany, Italy and Spain will claim a 83-88% market share in Europe by 2010, while emerging European PV markets will contribute 2.9 GW to market demand by 2013.

In the Asian and Pacific region, emerging PV markets in Australia, China and India will soon join Japan and South Korea as major regions contributing to global market demand over the 5 year forecast period. This will transform China and India's primary industry role from just being a manufacturing hub to an engine for PV market demand growth. The project pipeline for Asia Pacific (defined as identified project proposals not necessarily yet possessing confirmed financing and incentive structures) has already surpassed 7 GW. Meanwhile, Japan is also set for a steady return after four years in the wilderness.

In India, there are now 67 distinct projects proposals over one megawatt, while in China, the project pipeline has grown to 45 identified megawatt-scale project proposals. With over 70 distinct funding programs and incentive policies at the national and local level collectively in India and China targeting systems smaller than one megawatt, these countries represent a significant market opportunity over the next five years. This leaves the primary industry challenge to ensure that the existing suite of policies, and those under development, allow these projects to reach fruition.

In the US, 97% of the market size of the mid-range forecast in 2010 is already backed up by identified funding sources, projects under development and Renewable Portfolio Standard driven demand. This means that the pace of growth in that market will primarily be determined by financing, permitting and regulatory issues, rather than by product supply or PV subsidy constraints, factors that impacted market size over the last four years. A listing of over 60 large planned projects contributes to the 2.3 GW order book and together with planned Stimulus Bill-driven PV projects, provide the basis for rapid demand growth in the US. Nonetheless, companies all through the downstream US PV chain will need to reshape their strategies in response to significant changes in both end-market trends and supply mix over the next 5 years, in order to preserve their market shares.