By the end of 2016, 77 more gigawatts of solar power will be operational, topping a decade of continual growth for the industry. Even more, 79 gigawatts, is expected to come online across the world in 2017. That’s all according to the latest IHS Markit quarterly PV Demand Market Tracker, which looks at the solar market in nearly 50 countries.
This also is the second year in a row that demand grew annually by more than 30 percent. The majority of growth, according to the report, will have come from demand in China. In fact, the results are much higher than IHS anticipated even late last year when it anticipated 67 GWs of new solar in 2016.
“The proposed feed-in tariff cuts announced in China since September have resulted in stronger than projected growth in the fourth quarter,” Josefin Berg, senior analyst, IHS Technology, explained. “Therefore, we forecast annual installed capacity to be 77 GW in 2016, and 79 GW in 2017. This is a year-on-year growth rate of 34 percent in 2016, which follows the 32 percent year-on-year growth in 2015.”
The new projections are largely in line with projections from Mercom’s Global Solar Forecast November 2016. That report concluded that the world would install 76 gigawatts of solar power by the end of 2016.
It had been a while since the world’s solar industry grew so rapidly, according to IHS. The last such period was in 2010 and 2011, the analytics company said.
Looking ahead the company anticipated that 2017 will see a significant slowdown in growth and that only 3 percent more solar will be installed in 2017 (79 GWs) than in 2016. It explained that the slowdown will largely come because markets in China and the US will slow down.
In China, demand could drop by 40 percent in 2017. “Until China officially publishes the changes to the feed-in tariff rates, and the timeframe for the reductions, the forecast for total installed capacity in 2017 and the quarterly distribution remain highly uncertain,” Berg cautioned.
In the US the market was affected because of the extension of the investment tax credit (ITC). Developers had planned projects to come online in 2016 and 2017 to meet deadlines under the incentive program, but with the extension, they’ve delayed projects that were set to come online in 2017.
India will partially offset those losses as it grows to 10 gigawatts of new installations in 2017. “The Indian solar market is rapidly maturing and it is benefiting from low system costs globally,” Berg said. But it isn’t enough to offset the reductions in the US and China.Tweet