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This guest blog was provided by Ash Sharma, renewable energy research director, and Sam Wilkinson, Renewable Energy Research Analyst, at IMS Research:

Contrary to many announcements by analysts so far, IMS Research estimates that in 2009, the PV market – in terms of both new installations and shipments of PV modules and inverters -- grew substantially.

The latest results from our recently published report ‘The World Market for PV Cells and Modules’ reveal that PV module shipments grew considerably once again in 2009 – by over 25%, to more than 8GW.  However, IMS Research’s ongoing surveying of integrators and installers and analysis of grid-connection statistics also revealed that new installations grew by a much more modest 5-10%, but exceeding 6GW for the first time.

Like many others, following Q1 and Q2’s disastrous results, IMS Research had in fact expected 2009’s shipments to decline. However, following unprecedented growth in Q3 and Q4 and having collected and analysed data from all areas of the supply chain, results show that module shipments grew by over 25%.

While many may understandably be excited and encouraged by the news that shipments did in fact grow, market revenue growth tells a very different story. The collapse of the Spanish market, combined with a difficult economic climate, caused a significant drop in demand and prices plummeted by 40% as a result. Average prices were also driven down further by thin-film modules continuing to account for an increasing proportion of shipments. Consequentially, PV module revenues declined by over 20% in 2009.

The number of PV systems that were actually completed and connected to the grid in 2009 tells yet another story. Official statistics and government numbers are still being finalised and it will be some months before a final figure is arrived at.

However, IMS Research estimates that annual PV installations grew by 5% to 10%.

Installations in Europe were realised particularly quickly in the second half of the year. Germany led the way, installing around 3GW of new PV capacity. Italy did not disappoint either, although it will be some time before the GSE discloses a final figure for the year.

We understand that some 100MW of systems were completed before the end of the year in Italy, but not connected to the grid due to administration issues and the total for Italy will be closer to 480MW.

With 2009 PV module shipments growing far beyond expectation and installations growing less spectacularly, the natural question to ask is where all of these modules have gone?

We are seeing delays of two quarters between a module being shipped and it finally being connected to the grid and therefore being counted as an ‘installation’ in official figures – perhaps longer in very large installations.

In addition, we’ve seen that a significant proportion of PV modules were shipped in Q4 in anticipation of an unseasonably strong German market in the first half of 2010. This is likely to have been caused by intense speculation of a cut to the German tariff in July, reversing the country’s normal seasonality.

Early results show that the big winner in 2009 was First Solar, with shipments of its cadmium telluride modules more than doubling over 2008. As a result, thin film modules are estimated to have increased their share of the market further and accounted for 20% of shipments in 2009.

Another unlikely winner is Q-Cells International which IMS Research expects to shortly reveal as the largest PV system integrator in 2009 once it finalizes its research this month.

As for the PV market in 2010 as a whole, IMS Research forecasts that shipments will once again grow, not as fast as installations though as they continue to catch up with the surge in module shipments in 2009. With many expecting a drop in demand in the second half of the year, further falls in module prices are predicted.

Which begs the more important question, can the market grow in revenue terms this year too?

About IMS Research

IMS Research is a leading supplier of market research and consultancy services on a wide range of global electronics markets. The company has over 75 analysts spread across offices in Wellingborough, UK; Austin, Texas; and Shanghai, China. IMS Research has a team of five analysts dedicated to researching the entire PV supply chain in great detail.  

www.imsresearch.com