Despite majority share, growth in Europe slows and trouble lies aheadDespite brewing trouble for the solar industry in the region, Europe in 2011 will continue to account for the lion’s share of photovoltaic (PV) installations in the world, claiming approximately 70 percent of the global total, according to the latest IHS iSuppli research.
Comprising nine of the world’s 15 major solar markets, European PV installations this year will amount to 15.7 gigawatts (GW), nearly three-quarters of the global level of more than 22.2 GW. Europe will be home to the world’s two largest solar markets—Germany, with an estimated 9.4 GW; and Italy, with 3.9 GW—as well as seven other important PV territories including, in descending order, France, Belgium, the United Kingdom, the Czech Republic, Spain, Greece and Bulgaria.
In comparison, the United States—the third largest solar market worldwide—is projected to see 2.1 GW of PV installations in 2011, IHS iSuppli research indicates.
Notwithstanding Europe’s majority hold on global solar installations, its 70.7 share of market in 2011 will be a step down from 78.1 percent last year, when European installations reached
12.3 GW. Growth for the region also will decelerate this year, declining to 27.5 percent from a notable 120.3 percent expansion in 2010. In particular, bad news and uncertainty from specific European markets will serve to dampen overall PV prospects in 2011 for the continent.
The Good News vs. the Bad
Within the European market, the stellar performer will be Italy, growing much faster than expected this year. Total installations could go as high as 5 GW, spurred by rapidly growing capacity and excellent investment conditions in the country.: Ironically, it is the Italian government that appears less than enthused about the boom: As of March 9, 2011, Rome indicated it would attempt to reduce current PV funding in three months’ time—approximately by the June time frame.
Compared to Italy’s sunny outlook, the PV market situation is less assured in Germany, where a reduction in feed-in tariffs and government support expected later this year is likely to slow down growth. And although Germany is currently at the forefront of the global PV trade, the market here is expected to peak before four years are out. By 2015, German solar installations will stand at 5 GW, less than the country’s 2010 level.
In addition to the uncertainty facing the German PV sector, measures are under way to reduce the business proposition for solar investors in Spain, France and the Czech Republic, IHS iSuppli analysis shows.
In the case of Spain, the government is set to reduce the funding of existing solar power parks by approximately 30 percent, while France already has suspended any funding for larger solar systems until a new tariff scheme is finalized by the end of the first quarter. And for the Czech Republic, where state support for ground-mounted plants will stop sometime in March, PV installations for the year will contract severely, falling to 350 megawatts from 1.3 GW in 2010.
Looking ahead, the highest-growth PV markets in Europe will be Belgium, Bulgaria, Spain and the United Kingdom. By 2015, however, the United States will become the world’s single largest solar market, overtaking Germany, which will drop to second place after years of being at the pinnacle.