Amid European Solar Slow Down, Americas, Asia-Pacific Pick Up the Slack

The Americas and Asia/Pacific regions picked up the slack from a slowdown in Europe, driving newly installed solar photovoltaic (PV) power capacity to 30 gigawatts-peak (GWp) globally and driving cumulative capacity past the 100 GWp landmark to reach 101 GWp as of year-end of 2012, according to a report from the European Photovoltaic Industry Association (EPIA).

Some 16.5 GWp of new PV power capacity was installed across the European Union (EU) in 2012, down a full 25 percent from 2011's 22 GWp and bringing total EU installed solar PV capacity to just shy of 68.6 GWp, up from 52.1 GWp in 2011. Despite the slowdown, more than 68 terawatt-hours of electricity was generated by PV systems in the EU last year. That's 50 percent higher and up from 45.2 TWh in 2011.

Newly installed PV capacity in the Americas and Asia/Pacific markets offset the slowdown in Europe, indicative of a 'passing of the baton' when it comes to those leading solar PV growth worldwide, according to the EPIA's latest Photovoltaic Barometer. Newly-installed PV capacity totaled 31 GWp despite painful industry consolidation, sluggish economic growth and government budgetary problems in major markets around the world.

2012 in Solar: Passing of the PV growth baton

Growth in newly installed PV in the EU slowed for the first time since 2006 last year. Nonetheless, the EU market for solar PV continued predominant, according to the EPIA's latest data: the EU accounted for 55 percent of newly installed PV capacity in 2012, down from 70 percent in 2011.

In contrast, newly installed PV capacity rose year-over-year, totaling some 4.5 GWp in China, 3.3 GWp in the U.S., and 2.5 GWp in Japan for 2012. In total, total installed PV capacity exceeded 1 GWp in seven national markets around the world: Germany, China, Italy, the U.S., Japan, France and India.

Looking forward, PV market analysts at the SeeNews agency forecast newly installed PV capacity will total 34.5 GWp globally this year, up from 2012's 30-32 GWp. NPD Solarbuzz forecasts 31 GWp of new PV will be installed in 2013, EPIA notes in its latest Photovoltaic Barometer.

Ramping up PV capacity targets significantly over the past two years, China will lead growth in PV installations in 2013, according to the EPIA, as it looks to support its troubled domestic manufacturing base and keep people employed. The Chinese government announced it intends to double 2012 installations to about 10 GWp and has set a goal of 40 GWp to be installed by 2015, financed in the main via the Golden Sun Program.

According to EPIA,

“The government's press agency Xinhua News, quoting a Ministry of Finance source, announced that the government had decided to double its grants to the domestic solar sector at the end of December, 2012 to 13 billion yuan (1.6 billion euros). The same source states that these funds will cover more than 5.2 GWp of projects.

“The grant will be levied at 5.5 yuan per Wp (€ 0.68) for projects presented by developers for self-consumption, at 18 yuan (€ 2.23) for residential systems and 25 yuan per Wp (€ 3.09) for stand-alone systems.”

Also fueling worldwide PV growth, 2012 proved to be a record-setting year in the U.S., this despite ongoing opposition and efforts by Congressional representatives, primarily the new vanguard of soc-called “Tea Party” Republicans, to scale down or eliminate clean energy subsidies and incentives, as well as Congress' inability to reach a budget accord and avert automatic cuts in the federal budget – the federal budget sequestration process.

The U.S. Solar Energy Industries Association (SEIA) and GTM Research pegging total newly installed PV capacity at a record 3.313 GWp as of year-end, a full one-third of which came online in California. Total PV capacity in the US reached 7.221 GWp. GTM and SEIA forecast another 4300 MWp of new PV installations will be completed in 2013, which would be a rise of 29 percent.

PV market conditions in the EU in 2012 “were not ideal,” according to the EPIA:

“In the last three years, growth has mainly been driven by speculative investments taking advantage of the persisting difference between the guaranteed earnings levels and the very fast drop in production costs.”

Burdened by bank bailouts, a resulting sovereign debt crisis, sluggish economies and worrisome levels of unemployment, EU governments initiated efforts to claw back tax revenue by increasing taxes on electricity production or scaling back solar and renewable energy incentives, the EPIA highlights.

The Czech Republic enacted a retroactive tax on investments, Bulgaria passed a grid access tax, Greece passed a tax on installed and future PV systems installations, the Flanders region of Belgium enacted a retroactive grid access tax and Spain began imposing a tax on electricity producers' earnings.

Solar PV output is now three times' higher than it was in 2010, EPIA notes, accounting for more than 2 percent of total EU electricity consumption. PV produced in 2012 amounted to 136.3 Wp per inhabitant, with Germany (399.5 Wp/inhabitant), Italy (269 Wp/inhab) and Belgium (240 Wp/inhab) leading the way.

Solar PV outlook 2013-2017

With Europe paving the way forward, solar PV is coming of age and going mainstream in markets around the world, EPIA highlights in its Global Market Outlook for Photovoltaics: 2013-2017 report:

• 31.1 GW of PV systems were installed globally in 2012, up from 30.4 GW in 2011; PV remains, after hydro and wind power, the third most important renewable energy source in terms of globally installed capacity


• 17.2 GW of PV capacity were connected to the grid in Europe in 2012, compared to 22.4 GW in 2011; Europe still accounts for the predominant share of the annual global PV market, with 55 percent of all new capacity in 2012


• For the second year in a row, PV was the number-one new source of electricity generation installed in Europe; PV now covers 2.6 percent of the electricity demand and 5.2 percent of the peak electricity demand in Europe


• Germany was the top market in 2012, with 7.6 GW of newly connected systems; followed by China with an estimated 5 GW; Italy with 3.4 GW; the USA with 3.3 GW; and Japan with an estimated 2 GW


• Under a pessimistic Business-as-Usual scenario, the global annual market could reach 48 GW in 2017; under a Policy-Driven scenario, it could be as high as 84 GW in 2017

“The results of 2012 signal a turning point that will have profound implications in the coming years,” EPIA President Winfried Hoffmann was quoted in a press release. “The global PV market is shifting from one driven mostly by Europe to one that also depends on countries around the world with varying degrees of solar potential and the political will to exploit it.