The solar market is projected to grow in terms of megawatts installed in Asia and North America, but revenues will stay flat as price declines outpace volume growth.
“The global solar market for grid-connected systems will grow from 15.8 GW in 2010 to 37.5 GW in 2016, a compound annual growth rate of 15.5%,” said Lux Research Analyst Matt Feinstein, in a statement about a new report.
“However, price declines will outpace volume increases, at least at first – the industry will actually shrink on a revenue basis from $64.4 billion in 2010 to $56.9 billion in 2012 before recovering to $65.4 billion in 2016.”
According to a report, solar subsidies have been capped, cancelled, and cut over the past several years, but solar installations have continued to rise – driven primarily by increased demand from Germany, the largest user of solar.
However, as manufacturers approach near-term limits on cost reductions, German demand will begin to decline, according Lux Research report.
The report findings are that solar demand will shift to a broader range of markets over the next five years, based on analysis of “levelized” cost of electricity (LCOE) and internal rate of return (IRR) across 156 countries, states, and regions.
