In the beginning of May 2022, the world saw its cumulative installed solar capacity exceeding 1 TW with the addition of 167.8 GW in 2021 having gone up 21% YoY, according to SolarPower Europe (SPE), as it guides for 36% annual increase in 2022 to 228.5 GW and claims solar's next growth driver will be Europe.
This annual growth came despite the global PV world battling supply chain and logistics issues. Till the end of 2021, the global cumulative capacity had added up to 940 GW, as per SPE's Global Market Outlook for Solar Power (GMO) 2022-2026 report launched at the ongoing Intersolar Europe 2022.
Come 2025, under the report's medium scenario SPE sees global installed solar capacity doubling to 2 TW.
2021
Of the 2021 additions, China accounted for 33% claiming largest share with 54.9 GW followed by the Americas with 37.3 GW led by the US (27.3 GW). Europe contributed 31.8 GW or 19% of the total with Germany leading the tally at 6.0 GW, followed by 4.8 GW in Spain, 3.8 GW in Poland, 3.6 GW in the Netherlands and 2.7 GW in France.
India was the world's 3rd largest solar market with 14.2 GW installed and Japan the 4th even though its installations declined 21% YoY to 6.4 GW as most capacity came from feed-in-tariff (FIT) projects approved a couple of years ago.
Pointing at the record low tariffs achieved during auctions in across the globe, the lowest bid currently being $0.0104 in Saudi Arabia, the report writers point at the growing competitiveness of solar PV technology. Within 2021, solar tariffs in various auctions around the world dropped from $0.0429 per kWh in Malaysia to $0.0104 per kWh in Saudi Arabia.
2022 and beyond
SPE's analysis sees a total of 87.2 GW of new solar being installed in China in 2022 driven by rooftop solar capacity, thanks to which 10.9 GW has already been reported in 2M/2022. "The solar rooftop boom in China is the main driver for PV in the world's largest market these days — not just in the residential but also in the C&I segment, where rising power prices are a major incentive to go solar," reads the report, however the analysts add a disclaimer that the only factor that can negatively influence solar installations in 2022 will be China's response to the pandemic.
Latin America is the focus region for the report this year. In the Americas, apart from the US, it is Brazil that will be a market to watch out for as SPE guides for 62% annual increase in installations to 8.9 GW, up from 5.5 GW in 2021, when it entered the top 10 largest markets for the first time. Main drivers for Brazilian installations to grow are its tenders, 'extraordinarily attractive' net metering program for up to 5 MW and growing subsidy-free corporate solar market.
Europe will add 39.1 GW in 2022, with Germany expected to lead with 7.4 GW. SPE believes Europe has started seeing solar power in a new light especially with the Russian invasion of Ukraine. While solar power has a geostrategic importance as it brings energy independence, it is also versatile as its can be combined with heat pumps, to electrify heat supply, hence the scope is immense.
Recently, Energy Ministers from 5 European nations of Austria, Belgium, Lithuania, Luxembourg and Spain wrote to the European Commission (EC) asking for high European Union (EU) solar ambition of at least 1 TW EU solar by 2030.
For India, SPE sees annual installations of 20.3 GW in 2022 under medium scenario, but in low scenario (influenced by basic customs duty and high component prices), installations this year can settle at 13.6 GW.
On cumulative basis, SPE expects very strong demand for solar in the next 4 years growing from 255.8 GW in 2023 to 347 GW in 2026. In 2025, the forecast has gone up 18% to that offered in the previous GMO to a total of 314.2 GW which is when cumulative deployed capacity of the world should increase to 2 TW by 2025.
Compared to last GMO, the deployment assumption is 12% higher for 2022, still somewhat limited by the sustained high component prices, the short-term supply chain bottlenecks, and logistics issues (see SPE: 163 GW Solar PV Capacity Addition Globally In 2021).
SPE's new GMO 2022-2026 can be downloaded for free from its website.