Solar PV Market Set To Grow To $155 Billion In 2018

A new research report from Lux Research predicts that the solar photovoltaic market is expected to grow to a $155 billion industry by 2018, “as market forces engineer a turnaround to a healthy 10.5% compound annual growth rate (CAGR).”

The report produced a “most likely scenario” in which the PV market will grow at a modest rate to 35 GW this year before increasing in growth to reach 61.7 GW by 2018.

“Manufacturers’ nightmare is turning into a long-term boon for the industry. Record low prices pushed gross margins to near zero or below, but they’ve made solar installations competitive in more markets,” said Ed Cahill, Lux Research Associate and the lead author of the report titled, “Market Size Update 2013: Return to Equilibrium.”

“Supply and demand will come back into balance in 2015, easing price pressure, returning manufacturers to profitability and restoring the industry to equilibrium,” he added.

The research done by Lux Research was based on a detailed levelised cost of energy (LOCE) analysis in 156 separate locations, accounting for 82% of the world’s population, in an effort to determine the viability and competitiveness of solar in each market.

Their key findings are listed:

• U.S., China, Japan, and India will take over where Germany and Italy left off. With an 18% CAGR to 10.8 GW of installations in 2018, the United States will emerge the world’s second-largest market. But China will leapfrog it, growing over 15% annually to 12.4 GW in 2018.
• Utility-scale installations to grow the fastest; commercial the largest. Utility-scale solar, the smallest segment in 2012 at 8.6 GW, will grow the fastest to 19.9 GW in 2018 as developing markets turn to PV. Globally, commercial applications reign supreme as markets like the U.S. and Japan move to large rooftop installations.
• Opportunities abound for cheap IP. Struggling start-ups present opportunities to acquire intellectual property at record low prices. A case in point: Hanergy acquired Miasolé – which in 2012 announced the leading CIGS module efficiency at 15.5% – for only $30 million after investors had pumped $500 million into the firm.

The growth of the solar market is of particular value to second and third world countries,  many of which are experiencing burgeoning industrial and population growth requiring increasing levels of energy output. Minimising the reliance upon fossil fuels and focusing on a renewable energy like solar photovoltaic will be a way in which these developing countries can not only minimise their impact on the environment but also create efficient industries.