2013 a Better Year for Solar

Solar demand in 2012 slowed down to just 5% after a 40-50% CAGR over the last decade. The slowdown was inevitable as solar demand was a massive 30 GW in 2012 compared to just 8 GW in 2008. Europe which was the principal driver of growth has slowed down due to the economic slowdown. Many European countries which have massive solar booms have clamped down on solar installation subsidies, which has led to a degrowth in European solar demand. While the US and Asian countries have taken up the slack, they could not manage to grow the market at previously high double digit rates.

China to ramp up Solar Demand

However 2013 will be a much better year as China starts to ramp up its solar demand, as the prices of solar energy have plummeted. Solar energy is now being supplied at prices as low as 12c/KwH, which is comparable to the retail electricity prices. Given the problems of procuring fossil fuels at reasonable prices, solar energy has become very attractive in countries like China and India. Many of the provinces in these countries are promoting solar energy on their own besides the federal governments. Solar is much cheaper than retail electricity prices in high cost countries like Italy, Brazil, Germany etc. Many solar installations are coming up without subsides in these countries. Middle East countries with their very high solar insolation are also waking up to the solar opportunity and some big ground mounted solar power plants are being set up.

Read on GWI China Solar Booming.

With big Chinese solar panel companies managing to cut costs of panel production sharply almost every quarter, solar energy is becoming a bigger and bigger competitor to fossil fuel electricity each year. While the shale gas revolution in the US has sharply cut the prices of natural gas in the US, other regions still pay very high prices of gas and oil. Coal is under increasing assault due to its pollution and mining problems, while nuclear plants take up too much time to set up. Solar Energy has become the only viable option for the future in many of these countries. China with its massive pollution problems has decided to go all in to promote solar.

Read on GWI Chinese Solar Panels Review.

Bloomberg

The $77 billion solar-energy industry is forecast to expand the most since 2011, as China becomes the biggest market for the first time and drives annual global installations to a record. New generation capacity will rise about 14 percent this year to 34.1 gigawatts, equal to about eight atomic reactors, according to the average estimate of seven analysts surveyed by Bloomberg. That would beat the 4.4 percent growth in 2012, when demand shrank in Italy and France after subsidies were cut.

China, after building scores of factories that helped cut panel prices 20 percent in the past year, is poised to become the biggest consumer of the devices after doubling its 2013 target for new projects in January.