- Fitch Solutions believes Asia leads global solar project pipeline under development with 42% share
- With limited project visibility for China’s project development capacity, it sees India as the Asian nation leading the race
- Analysts see solar as one of the safest technologies for development with lower project risks
- Solar PV technology is considered a better bet over CSP technology by investors
There are currently 10 nations that hold a solar power project pipeline of more than 1 GW capacity under development in Asia, with India leading from the front, according to Key Projects Database (KPD) of Fitch Solutions Country Risk and Industry Research.
One would expect China to be at the top, not just in Asia but also globally, however analysts admit that China remains underrepresented due to ‘limited project visibility’. They claim, “As such, the Asia region’s solar capacity under development is even higher than the KPD would suggest, cementing its status as the global leader.”
In its Global Solar Project Analysis, Fitch Solutions counts Asia accounting for 42% of solar power project capacity at various development stages representing 137.5 GW, excluding cancelled or completed projects. Asia is followed by Latin America, and North America and Western Europe (NAWE) regions as 2nd and 3rd largest solar capacity project pipeline holders.
Within Latin America, solar growth will be led by Brazil and Chile as they hold around 34.5 GW and 17.3 GW capacity under development, respectively.
The US has 40.9 GW capacity under development within the NAWE region and Spain holds another 11.2 GW. Increased policy support and solar Investment Tax Credit (ITC) extension will give the US solar market a ‘sizeable boost’ over the coming years, according to the analysts.
Solar, safest bet
Fitch Solutions analysts call solar power as one of the safest technologies for development with an average project risk metric (PRM) of 7.0 compared to a global power sector average of 6.3. Only China holds an average PRM score of 8.3 within the solar sector. PRM quantifies the likelihood of a project progressing through the development stages in a timely manner.
“At the country level, we note that developed markets generally have lower project risks within the solar power sector than developing markets,” reads the analysis.
Solar PV technology scores over concentrated solar power (CSP) technology as an electricity generation source, according to the analysis thanks to its versatility, shorter project development and installation timelines, ability to scale up capacity and much lower costs per unit of capacity. On Fitch Solutions’ KPD, solar PV projects account for 94% of the total solar project capacity under development.