How Much Will Global Solar Energy Grow In 2017 – 10% , 20% or 30%?

With the beginning of every year, solar energy growth for that year becomes a hot topic of interest for analysts, market researchers and industry stakeholders. And more often than not, the demand estimation comes well ahead of what analysts predict. Given a large number of variables, it is almost impossible to predict the global solar demand with any certainty especially when Chinese solar panel companies have been crashing the prices of solar panels by almost 20-30% every year. The prices for solar energy are now low enough to compete with coal in many markets making them the go-to choice for new builds of power plants.

Also, read Global Solar Demand estimate for 2016.

2017 has started and some people have predicted a 0% increase, while some think it can increase by up to 10%. This is due to the fact that even though the prices are almost 30% lower, many of the large electricity markets like China and Japan are reaching saturation in terms of annual demand growth much like Germany did a couple of years ago. While India and the U.S. can keep growing rapidly, it will be compensated by a fall in demand from the 2 Asian giants. China installed a record-breaking 35 GW+ of solar capacity last year, accounting for almost 45% of the global demand. This year has not been very hot in China as solar panel prices remain subdued and there seems to be no major rush to install solar power plants before the expiry of the FIT period in June end.

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I think that the solar can again grow by 20% this year given that solar energy is not starting to create new demand for power. With solar prices so low, it makes sense to install solar energy in large parts of the world where solar prices are substantially lower than grid prices (e.g. places like Italy, Germany and Spain where solar plus storage has started to become cheaper than grid prices). Besides the Middle East, Latin America and other places where solar energy has not picked up should start to install big quantities given how cheap solar has become!

At the end of the day, it is simple economics which is driving solar energy instead of government policies and support. This is a much more powerful driver for solar energy growth and I think that the world can easily see 90 GW of solar energy capacity being installed in 2017. This is a top-down demand estimation and not a bottom up which is a fool’s estimation anyway given that nobody has a clue how China will act.