perspectives of pv sector in europe

PVs in BLOOMPVs in BLOOM

PERSPECTIVES OF PV SECTOR IN EUROPE

23 November 201023 November 2010

Dott. Giorgio DovigiItalian-Slovak Chamber of Commerce

The PVs in Bloom Project A project for land valorisation within a strategic eco-sustainable approach

to local development has been funded within the Intelligent Energy Europe Programme of the European Commission.

The Project is managed by an international consortium, led by Unioncamere del Veneto (the Regional Union of Chambers of Commerce of Veneto, North-East Italy) and composed by 9 partners from 6 EU countries:

- the Energy Agency of Sassari Province (Italy);

- the Chamber of Commerce Development Company of Central Macedonia (Greece);

- the Development Company of Municipality of Milies (Greece);

- the University of Jaen (Spain);

- the Chamber of Commerce, Industry and Shipping of Valencia (Spain);

- the Institute of Physics of the Lublin University of Technology (Poland);

- Innovation Region Styria (Austria);

- the Italian-Slovak Chamber of Commerce (Slovakia).

The PVs in Bloom Project

The Pvs in Bloom Project was created with the aim of supporting the installation by public and private investors of ground photovoltaic plants of small and medium dimensions with a power range from 50 kWp to 2-3 MWp in areas characterized by intrinsic, induced or latent marginality (terrains that are no longer able to answer positively to investments or that have exausted their primary and exclusive function).

The PVs in Bloom Project intends to promote the intelligent diffusion of PVPPs across Europe according to functional and enviroment-friendly criteria.

The RES growth in Europe has been driven by a small number of member states

The RES growth in Europe has seen a limited range

of technologies used

In the last 5 years started a growing awareness that PV utilization and exploitation has the potential to act as:

- a tremendous development engine;

- a key sustainability factor at the European Regional and local level;

- other than a premium carrier for environmental sustainability;

- an important element in the battle against climate change;

- a key component of the solution in the struggle to improve the security and reliability of energy supply;

- a welcome source of wealth and job creation.

PV installations in 2008

Forecasts PV installations in 2010

PV INSTALLATION WILL REACH RECORDS AGAIN IN 2010

Market size differs from XXL to M

XXL: Germany 6600 MWXL: Italy, Czech Republic, USA, Japan 700-1100 MWL: France, China, Spain, Belgium, Ontario 300-600 MWM: Greece, Bulgaria 50-200 MW

A total of 13,5 GW of new installations is forecasted.Largest grow is coming from Germany and Italy.

Germany is by far the largest PV market with 3.8 GWp new installed capacity in 2009 and much more is forecasted by the end of 2010.

Due to an unexpected strong market growth and fast price decline, the German parliament decided an additional reduction of PV FIT.

Expectation (due to oversupply): Reduced profit for PV investments in Germany will increase the pressure on PV markets worldwide.

LOWER PRICES AND STRONGER COMPETITION

Despite the economic crisis, the PV market has continued to grow by

almost 15% a year in 2009 and 2010.

The World leader in 2008, Spain went down from 2600 MW to only 69 MW due to financial crisis and possible cuts on FIT.

Italy and Czech Republic made impressive progress even if the future of

The Czech market seems very dark and also Italy, as Germany, cut FIT.

Possible changes of FIT by Governments

Reduction/End of FIT for ground mounted PV Systems (example: Spain and France)

Retroactive cut of State guaranteed Feed in Tariffs;

Households using PV to generate electricity mainly for their own use will not be probably subject to income tax on feed-in tariffs;

PV systems Building integrated on factories, hospitals and schools will be probably reduced less drastically than ground mounted systems.

Possible retroactive reduction of FIT by Governments

Czech Republic: Solar tax retroactively applied to all ground-mounted olar tax retroactively applied to all ground-mounted PV installations built in 2009 - 2010.PV installations built in 2009 - 2010.

Spain: Retroactive cut of 30% of State guaranteed Feed in Tariffs for Solar Energy;

Very dangerous outcomes for the Governments:

• Law suits and arbitration proceedings amounting to several EUR billions;• Loss of investors confidence;• Credit rating: a potential reduction in the country’s rating leading to higher

funding cost of the state budget deficit;

Not an exactly friendly grid connectionNumber of months for getting grid connection (considering also approval of Grid Connection)

Perspectives of PV sector in Europe Policy Driven

Perspectives of PV sector in the World

Evolution of the World annual PV Market

Evolution of the World annual PV Market

Europe is leading with almost 16 GW of total installed capacity in 2009, representing about 70% of the World cumulative PV power installed at the end of 2009.

Japan (2.6 GW) and the US (1.6 GW) are following behind.

China makes its entry into the TOP 10 of the World PV markets and is expected to become a major player in the coming years.

Production of modules by geographies

Production of modules by geographies

C-Si Crystalline Silicon cells and modules production capacity seemed to be dominated by Chinese and Taiwanese manufacturers (above 50% in both cases).

European production capacity counted for almost 20% for c-Si cells and almost 30% for c-Si modules. In Japan, both figures are below 10% whereas the USA production counts for only 5%.

The picture is different when considering solar grade silicon production capacity with up to 40% in the USA, followed by Europe and China, both having similar levels of production capacity (almost 20%) and Japan and the rest of Asia (both slightly above 10%).

With respect to Thin Film production capacities, Europe leads with around 30%, whereas China, the USA, Japan and the rest of Asia (mainly Malaysia) each count for about 10 to 20% of Thin Film production capacities.

Module’s production capacity vs. Market Outlook

Production capacity vs. Market Outlook

Is expected the industry’s production capacity to grow with a CAGR (Compound Annual Growth Rate) of around 20-30% for the period 2010-2014.

The upstream segment (silicon production) is expected to have the highest growth with about 30%.

This is because initial year-to-year growth rates (until 2011-2012) are higher, which is a direct consequence of the silicon shortage of the last years.

C-Si cell production capacity as well as module (combined c-Si and Thin Film) production capacity is expected to grow with a CAGR of around 22% during the next 5 years.

World PV Module Supplier Rankings 2009

Company Name Change 08 - 09

1. First Solar, Inc. (USA) 22. Suntech Power Holdings Co Ltd. (China) -13. Sharp Electronic Corporation (Japan) -14. Yingli Green Energy Holding Co Ltd (China) -5. Trina Solar Limited (China) 26. Sunpower Corporation (USA) -7. Kyocera Corporation (Japan) -28. Canadian Solar Inc. (China/Canada) 19. SolarWorld AG (Germany) 110. Sanyo Electric Co. Ltd (Japan) -2

Inverters: supply/demand scenarioShare of Production Capacity at end of Q2 2010

Inverters: supply/demand scenario

In the first three quarters of 2010 inverter suppliers enjoyed tremendously high demand and tight supply. Planned inverter production may exceed actual demand by more than 2 GW in Q1 2011 leading inevitably to large inventory build. Seems very likely that inverter suppliers will begin to see major order cancellations and large price drops in early 2011.

Production capacity has been massively increased: more than doubled in 2010 and by the end of the year will exceed 30 GW.

The improvement in component supply has allowed major suppliers to quickly increase their production, massively increasing supply.


Although many new entrants have emerged, it is very clear that the market remains dominated by the top 15 suppliers, both in shipment terms and also in terms of available capacity.

Shift in DemandAnother major hurdle inverter suppliers may need to overcome is a dramatic shift in demand that is predicted to occur in 2011. In 2010 one of the largest drivers of industry growth was the small commercial sector in Germany which will install around 4 GW.

Next year however, high growth is predicted for much larger installations in other regions such as the USA, Canada and China. In addition new markets, like the UK and India, will provide further substantial opportunities and inverter suppliers may have some real challenges shifting away from stagnating markets to capitalize on these.

Pv Market forecasts: moderate and policy driven

In the Moderate scenario, the European market could experience a rise up to 8.2 GW in 2010 followed by a return to less than 6 GW in 2011 and 8 GW in 2014.

For the time being, it is believed that the German market will not repeat its forecast 2010 figures in 2011, reducing that way the market size in Europe. In the Policy-Driven scenario, Europe could install as much as 11.5 GW in 2010 and up to 13.5 GW in 2014, after a slowdown in 2011 and 2012.

For 2010, is expected the World PV market to grow up to around 10.1.GW under the Moderate scenario. Under the Policy Driven scenario, the World PV market could reach around 15.5 GW, up from 8.2 GW and 12.7 GW respectively in our previous estimates.

Market forecasts: moderate and policy driven

Thank you for your attentionThank you for your attention

[email protected]

www.pvsinbloom.euwww.pvsinbloom.eublog.pvsinbloom.eu blog.pvsinbloom.eu

mailto:[email protected]