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Fast growth expected for global photovoltaic industry that grew at 70% pa from 2006-2011

Fast growth expected for global photovoltaic industry that grew at 70% pa from 2006-2011

12-Nov-12

The photovoltaic industry grew at 70% pa 2006-2011 and further fast growth is expected. In 2011, polymer usage in photovoltaic (PV) module manufacture exceeded US$ 2 bln, as per Applied Market Information Ltd (AMI Consulting). Increasing availability of renewable energy is a key political objective in many countries. Politicians have a variety of motives for their support ranging from meeting green targets, positioning themselves in favour of green initiatives, creating jobs, seeing PV production as a core part of a modern economy. Other key political objectives are securing a sensible energy mix and ensuring sufficient generating capacity. Although government financial support is being scaled back by Western cash-strapped governments, there is still sufficient political support globally to ensure the industry continues to grow quickly. Costs of PV production have fallen dramatically driven by new technology and oversupply at key parts of the supply chain. AMI Consulting estimates that PV module prices have fallen by around 50% in the last 18 months. The key polymers used in PV production are fluoropolymers, polyesters and EVA. Key polymer suppliers include Arkema, DuPont, ExxonMobil and Solvay. A large number of other polymer producers are pushing growth strategies such as Dow, Evonik and Solutia. Profitability has proved to be very unstable and consequently the industry is restructuring rapidly and new business models are emerging. Recent examples of restructuring include BP closing down its solar business in 2012, Abound Solar filing for bankruptcy in July 2012 despite having raised US$260 million in equity in the last three years and Q Cells being acquired by Hanwha in October 2012. A global industry has emerged with a high level of imports and trade patterns which are changing rapidly. A large scale shift has occurred in which the Chinese share of global module manufacture increased to more than 50% in 2011. As a response competition authorities are imposing antidumping duties. Having seen a fourfold increase in imports from China 2009-2011, the US Department of Commerce in October 2012 recommended antidumping duties on Chinese importers of PV cells and modules ranging from 18% to 250%. The European Commission (EC) started to investigate similar issues in September 2012 and it is likely that the Indian competition authorities too will take action soon.

PV Module manufacture by region in 2011
Europe 19%
North America 4%
China 54%
Asia (excluding China)ss 21%
Other 2%
Total 100

Photovoltaic markets saw record growth in 2011, but industry faces short-term challenges, as per EPIA. Solar photovoltaic (PV) electricity continued its remarkable growth trend in 2011, even in the midst of a financial and economic crisis and even as the PV industry was enduring a period of consolidation. As they have for the past decade, PV markets again grew faster than anyone had expected both in Europe and around the world. The European Photovoltaic Industry Association (EPIA) report assesses the European and global markets for PV in 2011, and makes forecasts for the next five years. Major findings for 2011 include:s

* 29.7 GW of PV systems were connected to the grid in 2011, up from 16.8 GW in 2010; in terms of installed systems the estimated numbers are a minimum of 24.7 GW in 2011, up from a maximum of 21.8 GW in 2010
* With approximately 70 GW cumulative global installations, PV is now, after hydro and wind power, the third most important renewable energy source in terms of globally installed capacity.
*21.9 GW were connected to the grid in Europe in 2011, compared to 13.4 GW in 2010; Europe still accounts for the predominant share of the global PV market, with 75% of all new capacity in 2011
* Italy was the top market for the year, with 9.3 GW connected, followed by Germany with 7.5 GW; Italy and Germany accounted for nearly 60% of global market growth during the past year
*China was the top non-European PV market in 2011, with 2.2 GW installed, followed by USA with 1.9 GW.

Such a rapid growth rate cannot be expected to last forever. The PV industry is now weathering a period of uncertainty in the short-term. But over the medium- and long-terms the prospects for continued robust growth are good. The results of 2011 � and indeed the outlook for the next several years � show that under the right policy conditions PV can continue its progress towards competitiveness in key electricity markets and become a mainstream energy source.

 
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