Global solar PV installations will achieve a new high of 114.5 gigawatts in 2019, up 17.5 percent over 2018.
According to Wood Mackenzie Power & Renewables’ new report, Global Solar PV Market Outlook Update: Q2 2019, the market is currently back on a strong growth trajectory following a downturn in 2018. Annual installations are expected to climb to around 125 gigawatts each year by the early 2020s.
Global expansion will continue despite a slow decline in China, the world’s largest PV industry. The Chinese market appeared at 53 gigawatts in 2017, driven by generous feed-in tariffs. We expect a move toward more competitive procurement of solar PV will cause more sustainable annual additions of 30 to 40 gigawatts.
Global PV marketplace continues to diversify quickly
Countries installing between 1 to 5 gigawatts annually is going to be the industry’s growth engine. In 2018, there were seven such markets.
Back in India, the auction activity is beginning to recover after a slowdown brought on by land and transmission constraints. In the U.S., announcements of new nation utility integrated resource plans, in Florida for instance, are great news for the solar PV industry.
The European economy will grow strongly as policy-driven markets look to deliver 2020 and 2030 renewable energy targets.
In Latin America, Brazil appears to be the most exciting market of the moment, with the two auctioned power-purchase agreements with vendors and free marketplace contracts with large consumers on offer.
In the Middle East, all eyes are on the upcoming 1.5-gigawatt auction in Saudi Arabia, which is set to be quite competitive.
China’s first solar PV auction
China recently announced the results of its first solar PV auction which caused a staggering 22.8 gigawatts of projects being awarded contracts. Awarded projects are intended to be linked at the end of 2019, facing tariff cuts for any flaws. This is by far the world’s largest completed auction, together with the next largest being the award of 3.9 gigawatts of solar PV in Spain during July 2017.
At June’s A-4 auction, Enerlife/Lightsource BP was awarded a contract for the 2,020 MW Milagres project for only $16.95/MWh — $2/MWh lower compared to the $18.93/MWh granted in 2017 to Neoen’s Pachamama PV job in Mexico.
Auctions will remain the driver of growth in many global PV markets. We hope to see 90 gigawatts of solar PV projects awarded contracts through auctions in 2019, up from 81 gigawatts in 2018.
