Renewable

November 16 (Renewables Now) - Rising manufacturing costs will not prevent the global solar photovoltaic (PV) market from growing, with installations expected to rise by more than 20% in 2022 to top 200 GW direct current (DC) for the first time, IHS Markit said today.

This would represent an investment of at least USD 170 billion (EUR 148.5bn), according to the firm’s Clean Energy Technology service.

In 2021, PV installations are expected to see double-digit growth, driven by key markets such as China, India, the US and Europe, with strong growth in the distributed generation segment, while the utility sector has been impacted by project delays and cancellations.

Falling PV system costs have hitherto been a major growth driver for the industry, but system costs have increased by 4% year-on-year in 2021 on logistic and supply chain disruption.

Edurne Zoco, executive director, clean energy technology at IHS Markit, said the supply chain needs to adjust to the significant global demand for solar installations. “We have seen this most clearly in the polysilicon market, which will continue to be a bottleneck for solar PV growth into 2022, until planned new capacity is ramped up from 2023 onwards,” Zoco added.

IHS Markit expects costs to resume a downward path from 2023. Through 2025 more than 1,000 GW DC of new solar is projected to be added.

The analyst firm also said that policy uncertainty in three big markets, China, the US and India, is the wild card for the 2022 forecast. This includes the length and intensity of current power restrictions in China, while in the US the utility-scale outlook could be impacted by a combination of high costs, a potential extension of the investment tax credit (ITC) scheme and increasing hurdles to module imports.

(USD 1 = EUR 0.874)

Join Renewables Now's free daily newsletter now!