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Solar Price Elasticity drives sharp Demand growth – EPIA predicts 12.7 GW solar installations in 2010

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EPIA joined the bandwagon of analysts and research firms predicting a large increase in global solar installations in 2010. Solar demand growth will be be >50% y/y in 2010 compared to 2009.The main driver for the increase is the sharp decrease in module and installations costs over the last 2 years .This has started to kick especially  in late 2009 and 2010 as  project financing has eased. Module prices which were ruling at $4/watt in late 2008 are below $2/watt now. This has sharply decreased the costs for generating for solar and is driving the growth in solar demand.Note critics of solar growth will say its subsidies driving the demand.No doubt that is true but countries are rapidly cutting subsidies – Italy,Germany , France  , despite this solar will grow more than  50% this year.

First Solar gave out spectacular surprising results driven by this super strong demand. A lot of solar skeptics are getting caught “short” . Would make sense to be bullish on the solar sector during this time.Valuations for green stocks are quite low compared to the “bubble” 2008 prices and have not rallied in 2010.The clean energy indices have underperformed in the last 2 years. Maybe this could change the trend .

Global PV mkt to reach up to 12.7 GW in 2010 – EPIA – Reuters

The global photovoltaic market could grow by up to 12.7 gigawatts in 2010, up 76 percent from last year, the world’s largest industry association said, adding Germany would remain the No.1 single solar market until 2014.

In Germany, total new installation could rise to 4.5 gigawatts this year, having reached a record 3.8 gigawatts last year, the European Photovoltaic Industry Association (EPIA) said in its global market outlook published on Tuesday.

However, EPIA indicated large cuts in feed-in tariffs (FiTs) — the solar sector’s lifeline until grid parity, the point at which solar power costs the same as fossil-fuel generated energy, has been reached — were a risk to the industry.

“A substantial decrease could jeopardise the development of the German industry, shifting the market to non-European low-cost manufacturers and destroying jobs by thousands in the German industry,” EPIA said.

EPIA usually provides an estimate range based on what it calls a “moderate” scenario — assuming that markets basically remain the same — and a “policy-driven” scenario describing a very favourable development of the industry.

Under a moderate scenario, growth in the United States — where the Obama administration is set to boost spending for renewable energy — could be 600 megawatts in 2010 and 3 gigawatts in 2014.

In a policy-driven scenario, the United States could become the world’s largest solar market in 2014 as U.S. growth reaches 6 gigawatts for the year, more than the 5.5 gigawatts expected for Germany


Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to

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