40 GW in 2014 – The sky is not always the limit
Understanding and forecasting the PV market size is essential to the development of the industry. In recent years, the boom was so fast that capacity expansions led rapidly to the well-known price war and the rapid consolidation process of the industry. The most interesting part was probably the exponential market growth from 2010 to 2011 that let many believe the market could reach fast tremendously high levels. Consequently the industry put new production capacities online. What happened next is known: with a 30 GW market in 2011 and 2012 and production capacities estimated above 50 GW at that time, the price war was highly damageable for the industry.
After a year of growth, one could believe the PV market could boom again. Some analysts announced phenomenal numbers: up to 50 GW installed in 2014. The truth is less rosy. In fact, numbers are finally showing that the PV market continued to grow but at a reasonable pace.
After 37 GW of PV installations in 2013 (below the 40 GW figure announced earlier due to lower final Chinese figures), 2014 experienced a moderate growth with a market stabilizing above 40 GW and up to 42 GW (again depending on final Chinese numbers). The case of China becomes interesting for everyone: with finally 9.5 GW installed in 2013 (according to the latest NEA statistics), and possibly 10.5 GW in 2014, the Chinese PV market grew fast but less than expected. This implies that final numbers for the PV market in 2013 were closer to 37 GW than 40 GW. In 2014, the PV Market Alliance estimates a 40 GW market, far below the 45-50 GW from many analysts. This number is by far the result of contrasted evolutions in the PV market that kept the growth lower: the decline of the European PV markets, the slow emergence of new countries in emerging economies and the finally limited growth in the US (compared to its market potential).
The following trends defined the market in 2014:
- Although new policies, designed to favor distributed solar PV over utility-scale, have yet to bear fruit, China managed to maintain its global pole position as the largest market with 10.5 to 12 GW depending on last quarter performance, after 2013 figures were revised downwards to 9.5 GW,
- Japan continued to install PV at an accelerated speed, with above 9 GW installed,
- Momentum continues in the US market that saw around 6 GW of demand in 2014,
- European markets declined for the third year in a row to around 7 GW, with UK and Germany leading the pace, followed by France, while Italy and Spain plunged.
- Six emerging markets (South Africa, India, Thailand, Chile, Mexico and Turkey) contributed together to around 3 GW in 2014.
- Australia continued to expand its PV capacities in the residential sector, with more than 0.7 GW installed.
- Numerous multi-MW markets confirmed in 2014: Korea, Canada, Taiwan and more.
In a nutshell, PV continued to expand in 2014 and will most probably continue to do so in 2015. The question of the sustainability of several markets is at the core of the forecasts for the coming years, in a global market dominated, once again, with 3 countries: China, Japan and the USA. This reminds the European pictures of the years 2010-2012, when a limited number of markets ensured the growth. And later the decline.