Data and information services company IHS Markit predicts ballooning growth of global solar installations, a rebound from the disruptive effects of COVID-19, which impacted market growth negatively last year.
A new report on the top clean technology trends to watch in 2021 compiled by the firm forecasts that annual solar installations will grow by over 30% in 2021 after volatile demand in 2020, triggered by the COVID-19 pandemic.
Major factors driving the growth will be the large inflow of investments in the renewable energy sector, an increase in favourable government initiatives and a rise in the number of residential solar rooftop installations.
IHS says this strong market demand comes despite an increase in production costs (up 10-15%) driving a historic surge in module prices, especially in the first quarter. However, it says, production costs are set to drop in the second half of the year, lowering module prices and laying the ground for record solar installations at the end of 2021.
“We will see for the first time a situation in which global demand grows over 30% despite high module prices in the first half of the year, which is unprecedented in the solar photovoltaic industry,” says Edurne Zoco, executive director, clean energy technology at IHS Markit.
For SA, the IHS forecast comes as the country is witnessing an upswing in renewable energy consumption, as local businesses and households seek alternative sources for affordable power supply.
Energy solutions companies are seizing opportunities in solar more aggressively, targeting home-owners and businesses, as SA continues to experience a surge in the uptake of renewable energy.
The suppliers say alternative energy solutions, like solar power, provide considerable savings on operational expenses, and protect companies and homes from unplanned power interruptions such as load-shedding.
The latest IHS report also notes 2020 was a record year for wind, with the company tracking activity of nearly 120GW.
“Of this, nearly 60% was from mainland China, including projects that have secured subsidy entitlement. Annual onshore wind installations in 2021 will continue to be derived from installation rushes in markets facing imminent subsidy cuts, including the US and mainland China.
“Non-mainstream renewables such as geothermal will continue generating increasing attention from conventional energy companies and investors − nearly 0.5GW of new capacity is expected to be commissioned throughout 2021, with Indonesia and Kenya leading the global market.”
According to the report, Spain, India and the Middle East will continue to be the markets with the lowest solar levelised cost of electricity. IHS Markit projects photovoltaic systems capex to continue declining in 2021 by 5% year-on-year, largely driven by decreasing component prices.
Meanwhile, the report says, average module efficiency records continue to increase, surpassing 22.5% in PERC monocrystalline cell commercial production and are forecast to reach 24% by 2022.
“Perovskites technologies, a promising solar cell technology development with significant potential to increase cell efficiencies and reduce costs, is set to continue breaking efficiency records, but the technology will only be mature for commercial production in the next five years.”
IHS also notes that in 2021, the offshore wind industry will deploy more than 10GW of capacity, nearly twice as much as last year, driven by the boom in installations in mainland China.
“Capacity tenders will also burgeon this year, with over 20GW worth of capacity to be auctioned in the UK, France, Denmark, Netherlands, Germany, the US, Japan and Taiwan.”
Share