Morgan Stanley: US Could Have 129 GW Of Commercial Solar By 2018
Originally published on RenewEconomy.
By Sophie Vorrath.
The installed capacity of solar PV in North and South America will increase more than tenfold over the coming years, jumping from 13.1 Gigawatts (GW) in 2013 to 138.8GW by 2030 – according to a new report from consulting firm GlobalData.
The research – which encompasses key solar players like the US, Canada and Brazil – also predicts that power generated by solar PV installations in the Americas will also experience a growth spurt, jumping from 21 Terawatt-hours (TWh) in 2013 to 234 TWh by 2030.
Big numbers, indeed. But will it really take until 2030 for this growth to happen? According to one Morgan Stanley analyst, the US market alone could have around 130GW installed within the next four years.
“We estimate that the commercial-scale solar market could be as large as 129GW in 2018, assuming that the investment tax credit (ITC) goes to 0% and utilities nationwide implement fixed charges on solar customers,” Morgan Stanley analyst Timothy Radcliff wrote on Tuesday, in connection with his decision to upgrade Sunedison stock to ‘overweight’.
“We believe the market currently expects an ITC-driven rush through 2016, followed by a significant decline in volumes and margins.”
As GlobalData’s Tanikella notes, the US (along with Canada) is among the global leaders in terms of renewable power generation, due mainly to the policy support mechanisms of federal and state governments.
In 2013, he says, the US held the majority share of the region’s solar PV installed capacity, with 89.1 per cent, followed by Canada and Brazil, with smaller shares of 8.5 per cent and 0.2 per cent, respectively.
In Brazil, says Tanikella, the government uses auctions to encourage renewables development – it approved 122MW of solar PV capacity in its first solar-only auction in 2013, with solar projects receiving $98 per Megawatt-hour for power generation.
Mexico, meanwhile, is also supporting renewable power development, its government establishing a National Energy Strategy for policies to be implemented over the next 15 years, to increase the country’s electricity generation from non-fossil sources by 35 per cent.
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Whenever this type of article is offered, the numbers lose their meaning because we are never told the total energy used in X country and what this projection means for renewable energy in that country.
I’d like to see that this increase in solar capacity means the % of renewable energy could change from X to Y. In the US, renewables are now doing, what, 13% of total power? Four years ago it was something like 4-5%? That’s a big difference, but it gets lost in all the articles saying “this project will add 440 MW of power” with no other context.
And my question is on the statement from Morgan Stanley ” If utilities nationwide implement fees on solar customers”. Is he referring to people or businesses wanting to be sure that their energy comes from solar sources? Or is he backing the utilities desires to tax individuals putting solar energy into the grid.
With my thoughts being that in the long run if the utilities separate costs of energy and grid maintenance, then there’s going to have to be some charge (hopefully figured fairly) for those using their own solar energy that still want to use the grid to disperse the excess and backup for when they need it.
Morgan Stanley must be assuming that future grid access charges on solar rooftop producers are going to be moderate and fair. This cannot be taken for granted. In Arizona, the fees the utility proposed were clearly punitive, designed to kill a competitor to its fossil generating assets. The utility lost, and this outcome is likely to be repeated because democracy, but it’s not a sure thing and will have to be fought for.
Yes, a quick ramp.
The soalr-only auction in Brazil was not run by the federal government – which still thinks solar too expensive compared to wind and hydro – but by the state of Pernambuco, which is hoping to establish itself as the place in Brazil for solar firms to set up shop. Coincidentally I’m sure, the state governor, Eduardo Campos, has presidential ambitions and has allied himself to green leader Marina Silva, who ran an honourable third in the last presidential elections. It’s quite likely that other state governors will copy. But Brazilian national solar policy is slightly less positive than the analyst cited thinks.
Ignore the exact amounts for a minute. The key here is that we are seeing more and more main stream players (Morgan Stanley is not fringe) say. Hey! Listen up PV and Wind are being way under estimated by most everyone. Wake up if you want to make money on this next big thing.
Indeed. Citi, Deutche Bank and now Morgan Stanley
what happened with car sales lets say 50 years ago.
only few had a car,now everybody has a car
same with Solar Power.
everybody will have Solar Power.
Buy Solar, make dollar.