European & Global Solar PV 2012–2017 (EPIA Report)

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The European Photovoltaic Industry Association (EPIA) has gone out and confirmed what others had already reported — the global solar PV market grew by about 30 GW in 2012 (31.1 GW by EPIA’s recording). But its report also includes a lot of other interesting and useful information about the European and the global solar marketplace.

As I’ve reported in previous articles about 2012’s solar numbers, the year marked a bit of a shift away from Europe and into other markets, especially Asia. Europe still dominated, with Germany installing a stunning 7.6 GW of new solar PV capacity. Italy also installed a lot — 3.4 GW. But the year was more balanced than previous years, with Asia adding 5 GW, the US adding 3.3 GW, and Japan adding about 2 GW.

EPIA’s Global Market Outlook 2013–2017 notes that 2012 was the first year in over a decade that Europe’s solar installation numbers declined compared to the year before. But it still accounted for about 55% of new global PV capacity. (Note: it accounted for 74% in 2011.)

Some other key notes from the report regarding 2012 were:

• Solar PV remains the third-largest renewable energy source (in terms of capacity) in the world, only behind hydro and wind power.
• Solar PV was #1 for new electricity generation capacity in the EU, for the second year in a row.
• “PV now covers 2.6% of the electricity demand and 5.2% of the peak electricity demand in Europe”

Per Capita Leaders

Looking at the relative leaders is always quite interesting to me, and more useful when it comes to identifying which countries and regions to emulate. Here’s a quick look at the relative solar PV leaders in Europe:

Beyond 2012

EPIA’s report went beyond 2012 and made projections about the coming few years. In 2017, EPIA projects that the global solar PV market could reach 48 GW under a business-as-usual scenario or up to 84 GW under a more optimistic, policy-driven scenario.

While incentives have long played an important role in solar’s growth, and will continue to do so (just as they do for every other energy industry), the falling price of solar is making it competitive with other new electricity options even without incentives in a fast-growing number of places. EPIA writes:

PV markets in Europe and around the world continued making rapid progress in 2012 toward competitiveness in the electricity sector. The strong price decreases of PV technology, and increased electricity prices in general, have helped drive momentum toward what is often called ‘grid parity’.

The moment is near when the savings in electricity cost and/or the revenues generated by selling PV electricity on the market could be equal to or higher than the long-term cost of installing and financing a PV system. This so-called “dynamic grid parity” appears within range in several EU countries, and has been reached already in some segments of some countries.

Nonetheless, incentives are still very important and necessary in the large majority of locations. “Various national schemes – whether they are being introduced, modified, or phased out – have a significant influence on EPIA’s forecasts and scenarios as they have serious consequences on national PV markets and industries.”

Bad Decisions

Naturally, the poor economic and financial situation in Europe and globally has had a negative effect on solar PV deployment. However, the situation has been worsened by unintelligent decisions within some governments. As EPIA notes, this harms not only the solar PV markets in these countries, but the countries as a whole:

[T]he economic uncertainty in several European markets has in some cases pushed policymakers to make decisions that have a negative effect on the market, such as imposing retroactive measures. Such decisions severely erode investor confidence even as PV technology and competitiveness improve – slowing market development in a way that is not easily predictable. Moreover, these measures harm these countries’ credibility not just for PV but for their whole financing sector.

It is critical that governments not making any further decisions like those. And it would be very helpful for the economies, the climate, and the environment in general if they provided strong and predictable support to solar PV in the coming years, hopefully driving Europe to 84 GW of new solar PV capacity per year.

For much more discussion on these and related matters, I recommend checking out the full EPIA report.

I do have a few more notes from the report that I want to highlight, but I’m going to break them out in another post or two in order to give them more limelight.