Growth of Solar Photovoltaics

The growth of solar photovoltaics (PV) in 2010 has been remarkable. Decreasing cost, new applications, strong investor interest, and continued political support have contributed to this development. On a global basis, new PV installations of approximately 16 GW were added, double the increase seen in 2009. Cumulative solar capacity is now at 40 GW. Government subsidies, particularly in Germany and Italy, helped to make 2010 a successful year for the solar photovoltaic industry, despite the continued financial crisis and falling solar prices around the world.

Accounting for some 70% of the global market, Europe alone added about 13 GW of new solar power installations in 2010. For the second year in a row, Germany has been the global PV market leader, adding over 6.5 GW of new installations to the already existing 9.8 GW of PV systems. For the first time, the yearly installations in Italy and the Czech Republic surpassed 1 GW. Belgium, France, and Spain saw very significant volumes in 2010. Japan, the U.S., China, and Australia remain key growth markets. Major new areas for development lie in India, Africa, the Middle East, and South America, however lack of political support still hinders the growth of these markets.

Solar PV module demand reached record levels in 2010, driven by incentive schemes, particularly in Germany, Italy, and the Czech Republic--the three largest markets last year. However, they have reduced the rates offered for electricity generated from solar PV systems at the start of 2011. As a result, while global solar PV installations are still set to increase in 2011, they will do so at a far slower rate. This may result in an oversupply of solar PV modules this year, leading to tougher competition and decreasing prices from suppliers. As countries dial back their subsidy programs, solar companies will be scrambling to find the next big growth market for 2011 and beyond.