Global solar demand growth has been modest at best, according to Jefferies analyst Jesse Pichel, leading the company to believe that the industry won’t see signs of real recovery until the second half of 2013 or even 2014. The second half of 2012 will see demand in Europe decline further than the first half, with 2013 volume dropping even lower.
Although lower module ASPs are in general good for the industry, demand elasticity is suffering as module manufacturers have to cope with lower than expected revenue figures. Module prices are being forecasted at the €0.51–0.55/watt range for Q4 from tier two suppliers, allowing healthy competition among project developers with most retail electricity prices.
It would appear that the smart move is to shift focus to projects as module manufacturers face another two years of little to no profit, says Pichel, as “developers are making outsized returns in subsidized markets.” Following the lead of SunPower, and Canadian Solar is First Solar, although there might not be as many benefits for the CdTe company along the way as cost advantages will likely not be as significant as with c-Si-based project development.
In terms of markets, Germany looks set to have a relatively healthy 2H’12 and 2012, but slightly lower as a result of the likely tariff changes due to be announced any day now. Demand in Italy has slowed down considerably, with expectations of end-of-year total installs of 2GW.
The real survivors in the industry – the markets of Japan, the US and China – will continue on their upward trend with some South American and African countries also coming to the fore.