Energize Weekly, July 31, 2019
Global solar photovoltaic (PV) installations are set to reach a record 114.5 gigawatts (GW) in 2019, up nearly 18 percent from 2018, according to Wood Mackenzie Power & Renewables.
The Chinese PV market, the world’s biggest, is slowing down as the government makes changes to its solar subsidy policies while other national markets are picking up.
“Global growth will continue despite a gradual slowdown in China” Tom Heggarty, a Wood Mackenzie senior research analyst, said in a statement.
“The Chinese market peaked at 53 GW in 2017, driven by generous feed-in tariffs,” Heggarty said. “A move towards more competitive procurement of solar PV will lead to more sustainable annual additions of 30-40 GW.”
China had its first solar PV auction recently, and 22.8 GW of projects were awarded, making it the world’s largest completed auction, dwarfing the previously top auction of 3.9 GW in Spain in July 2017.
The engine for market growth in 2019, however, will be seven countries slated to install between 1 GW and 5 GW Wood Mackenzie said. By 2022, Wood Mackenzie said there will be 19 such national markets, including Saudi Arabia, France and Taiwan.
The Indian market, after a slowdown due to land and transmission constraints, is now picking up. In the U.S., utilities are calling for more PV installations in their integrated resource plans, Heggarty said.
The European market will continue to grow as countries aim to deliver on 2020 and 2030 renewable energy targets. In the Middle East, there is an upcoming auction for 1.5 GW, which Heggarty said is expected to be “extremely competitive.”
Brazil is currently the most dynamic market in Latin America with auctioned power purchase agreements with distributors and free market contracts with large consumers being offered, Wood Mackenzie said.
In Brazil’s June auction, Enerlife/Lightsource BP was awarded a contract for the 2-GW Milagres project for just $16.95 a megawatt-hour (MWh). That was $2 a MWh lower than the $18.93 MWh awarded in 2017 to Neon’s Pachamama PV project in Mexico.
“Auctions will remain the driver of growth in many global PV markets,” Heggarty said. “We expect to see 90 GW of solar PV projects awarded contracts through auctions in 2019, up from 81 GW in 2018.”
