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Market & Competitiveness

ON THE ROAD TO COMPETITIVENESS

Solar photovoltaic technology has proven in recent years that, with the appropriate regulatory framework in place, it can be a major contributor to reaching the EU’s target of 20% renewable energy sources (RES) by 2020. Technology improvements and economies of scale have spurred steady cost reduction, which will continue in coming years as the PV industry progresses toward competitiveness with conventional energy sources.

But already today, PV electricity is cheaper than many people think. In the coming years the technology will become even more cost-effective and competitive — and qualify therefore as a vital part of Europe’s energy future. Under the right policy and market conditions, a certain level of competitiveness with grid electricity could be achieved in some markets as early as 2013, and then spread across the continent in the different market segments by 2020.

The expected system price decline will continue to play a major role in the achievement of PV competitiveness.

PV will play an important role in the evolution of the European energy mix, covering about 15% (or, under a paradigm shift scenario, up to 25%) of the EU electricity demand by 2030.

MARKET SITUATION AT THE END OF 2012

PV system prices have declined by more than 50% over the past five years, bringing PV close to competitiveness in some countries, in some market segments. Driven by adequate Feed-in-Tariffs or similar incentives, the PV market has developed accordingly in many countries in Europe and it has begun significant growth outside of Europe since 2010.

  • 31.1 GW of PV systems were installed globally in 2012, up from 30.4 GW in 2011; PV remains, after hydro and wind power, the third most important renewable energy source in terms of globally installed capacity
      
  • 17.2 GW of PV capacity were connected to the grid in Europe in 2012, compared to 22.4 GW in 2011; Europe still accounts for the predominant share of the annual global PV market, with 55% of all new capacity in 2012
      
  • Germany was the top market in 2012, with 7.6 GW of newly connected systems; followed by China with an estimated 5 GW; Italy with 3.4 GW; the USA with 3.3 GW; and Japan with an estimated 2 GW
       
  • For the second year in a row, PV was the number-one new source of electricity generation installed in Europe; PV now covers 2.6% of the electricity demand and 5.2% of the peak electricity demand in Europe
       
  • Under a pessimistic Business-as-Usual scenario, the global annual market could reach 48 GW in 2017; under a Policy-Driven scenario, it could be as high as 84 GW in 2017

For the second year in a row, PV was the number-one new source of electricity generation installed in Europe in 2012; PV now covers 2.6% of the electricity demand and 5.2% of the peak electricity demand in Europe.

In 2012, more than 100 GW of PV are installed globally - an amount capable of producing at least 110 TWh of electricity every year. This energy volume is sufficient to cover the annual power supply needs of over 30 million European households.

For the first time in the last 12 years, the PV market in Europe decreased in terms of new connected capacity. Even so, in 2012 the PV market in Europe again exceeded all expectations. 

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