Environmental friendly policies are diversifying the global energy mix and helping renewable to increase its market share. The shift towards renewable is relatively faster in developed markets where environmental regulations are strict and incentives are higher. Solar power is one of the growing and emerging energy sectors which has been benefiting significantly from current legislation and disruptive technologies.
We assess that the global solar power market grew from just 13 TWh in 2008 to 375 TWh in 2017. Developed markets remained at the forefronts in promoting the solar power market. Although, developing markets are lagging behind in the race but has recently shown sharp growth through the residential sector. Whereas the developed markets are working on energy storage solutions to help them save excesses energy, developing markets are still struggling to have enough power. About one billion people still have no access to electricity.
The lack of power infrastructure and rolling blackouts, solar panels technology has become an ideal solution. Solar Home Systems (SHS) is supporting in filling the electrification gap in developing markets. SHS will revolutionize the energy sector in developing countries, though its widespread adoption depends on factors such as government support, affordability, cost of installations etc. Solar power will continue to help in reducing pressure on the national grid which is a relief for the governments during peak times.
The falling modules and installation costs have increased the adoption rates globally. We expect that the market share of solar power in the total energy mix will reach around 4% by 2028. Most of the regions will exhibit a double digit growth for at least in the coming five years. Commodity Inside anticipates that North East Asia will continue to dominate the market with China playing a key role.
Wind power will be a major competitor, but the solar energy has an advantage over it due to low Capex. The economics of solar power is also getting better. Its cost-competitiveness has increased over the past ten years which is supporting the adoption rates particularly in developing markets. The overall cost of rooftop solar PV (photovoltaic) systems has almost halved in some major markets over the past ten years. The cost has declined as a result of fall in upstream costs, mainly equipment. Commodity Inside expects that there would be further reductions in module costs, as well as downstream costs, consisting of installation and service. Consequently, the overall costs to consumers will further decline over the next ten year supporting solar energy market.
This article is based on our recently publish report “The Global Solar Energy Market Outlook 2018-2023”.
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