Diminishing Incentives Cast Shadow on European Solar Markets, Says Frost & Sullivan Maturing solar photovoltaic market still offers pockets of opportunity
LONDON, Oct. 24, 2012 /PRNewswire/ -- The European photovoltaic (PV) solar market is undergoing a transition as the era of generous subsidies comes to an end. System prices continue to plummet as Chinese manufacturers exert pricing pressure on their European counterparts, forcing inefficient companies to exit the market as evidenced by a number of top players being forced to close their factory gates at the end of 2011- beginning of 2012. In the concentrated solar power (CSP) market, technology developers continue to innovate and focus on reducing the cost of energy.
New analysis from Frost & Sullivan (http://www.energy.frost.com), European Solar Power Markets, estimates that overall revenues in 2015 will shrink to €6.57 billion, with the European CSP market set to expand from €2,114 million to €5,227 million over 2010-2015.
"Overcapacity and plunging solar panel raw material and component prices are driving solar module costs and prices down, thus making the investment more attractive to buyers," noted recent research from Frost & Sullivan. "In order to counter the effect of diminishing incentives and stimulate demand, manufacturers along the value chain are expected to continue lowering solar module prices even further."
Maturing PV solar technology and declining energy costs are being accompanied by scaled-back subsidies. Despite the diminishing tariffs, the industry is attracting several investors that want to benefit by including solar technology in their portfolio.
At the same time, CSP technology is developing rapidly. Based on its potential to produce low-cost solar electricity on a larger scale, it has been able to attract investors.
However, significant cuts in government support for solar power in key markets and indications of further cuts have created considerable uncertainty in the market. As a result, investors are hesitant to proceed with their planned solar projects.
"To moderate the unsustainable growth of the PV solar market and citing a sharp drop in solar module prices, several European countries are scaling back the feed in tariffs, while placing limits on annual capacity additions," stated Frost & Sullivan research. "Continued government support will be vital if the nascent CSP technology sector is to develop further."
As profit margins become thinner, it is imperative for PV solar module manufacturers to produce more efficient modules. The overall market will receive a further fillip if energy from CSP, which can be stored or combined with gas, could become competitive in the next decade through technological innovation and economies of scale.
If you are interested in more information on this study, please send an e-mail with your contact details to Chiara Carella, Corporate Communications, at email@example.com.
European Solar Power Markets is part of the Energy & Power Growth Partnership Service programme, which also includes research in the following markets: Global Solar Power Markets, European Wind Energy Markets and, Global Gas Genset Market. All research included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.
About Frost & Sullivan
Frost & Sullivan, the Growth Partnership Company, works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that will make or break today's market participants.
Our "Growth Partnership" supports clients by addressing these opportunities and incorporating two key elements driving visionary innovation: The Integrated Value Proposition and The Partnership Infrastructure.
- The Integrated Value Proposition provides support to our clients throughout all phases of their journey to visionary innovation including: research, analysis, strategy, vision, innovation and implementation.
- The Partnership Infrastructure is entirely unique as it constructs the foundation upon which visionary innovation becomes possible. This includes our 360 degree research, comprehensive industry coverage, career best practices as well as our global footprint of more than 40 offices.
For more than 50 years, we have been developing growth strategies for the global 1000, emerging businesses, the public sector and the investment community. Is your organisation prepared for the next profound wave of industry convergence, disruptive technologies, increasing competitive intensity, Mega Trends, breakthrough best practices, changing customer dynamics and emerging economies?
European Solar Power Markets
Corporate Communications – Europe
P: +44 (0) 20 7343 8314
M: +44 (0) 753 3017689
SOURCE Frost & Sullivan