Surprisingly high demand in Germany among global solar market drivers - Mercom Capital

Sep 17, 2012 - Global solar power capacity is rising at greater-than-expected levels despite negative forecasts from earlier this year, and surprisingly strong demand in European markets such as Italy and Germany is playing a key role, Mercom Capital Group says in a market study.

Germany installed 5 GW of solar power capacity between January and July and is well on the way to even surpass last year's 7.5 GW, Mercom said. It noted that earlier projections saw the market at only 2 GW to 3.5 GW. Germany recently launched a new feed-in tariff (FiT) scheme with lower rates for renewables, which is aimed at cutting annual green capacity additions to the manageable 2.5 GW-3.5 GW "but as long as module prices and system costs keep going down and if investors can make a decent return, installation levels will keep surprising the markets", Mercom added.

The other top global solar market -- Italy -- is seen to install 3.5 GW in 2012, falling from more than 9 GW in 2011. It has postponed to October the launch of the Conto Energia V FiT plan, under which there will be solar subsidies of total of EUR 700 million (USD 917m). The delay means that the more generous Conto Energia IV is still in effect, which, according to Mercom, may lead to a mini-rush situation.

France has installed 709 MW of solar in the first six months of this year, Mercom said, citing recent data. The country has also greenlighted 540 MW of solar power projects under its recently-adopted tendering process for green energy. It is also planning to call another tender in the coming weeks. "The current French market is largely a reflection of grandfathered projects from 2010 coming online - there are about 3.5 GW of grandfathered systems with 2 GW expected to be connected in 2011 and 2012".

In its Mercom Global PV Forecast - Sep 2012 report, the market intelligence firm has compiled data from multiple sector analysts including GTM Research, IHS iSuppli, IMS Research, Macquarie Capital, Solarbuzz and government, public and private sources.

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