Regardless of what market research data you rely on, the analysts agree: the photovoltaics market is expected to grow considerably in 2010. Even the most hawkish of forecasts would therefore expect PV installations to almost double from 2009, creating a demand somewhere near 14GW in 2010. According to Bernreuter Research, which specializes in tracking the polysilicon market, polysilicon production in 2010 should be sufficient to produce the equivalent of 17GW of c-Si modules.
However, the continued rapid growth in demand for solar PV is putting supply pressures back onto the polysilicon producers as supply and demand tightens. For several years, polysilicon was in short supply, forcing prices to reach as high as US$450/kg in mid-2008. Although multibillion-dollar investments have been made in new polysilicon production by established as well as new entrants to the market, PV growth has intensified and spot-market prices for polysilicon have been rising since midyear to over US$70/kg, compared with US$50/kg previously.
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“Although most analysts only predict between 13 and 20GW of new PV installations in 2011, we do not expect a massive oversupply of polysilicon next year,” noted Johannes Bernreuter, head of Bernreuter Research.
The firm recently evaluated more than 40 market analysts forecasts from 2008 through 2010; almost all of them show installation figures well below the actual results in 2008 and 2009, which Bernreuter thinks will happen again in 2010.
“The forecasts deviate from the actual value by up to 50% downwards,” he explains. “Obviously, demand is more elastic than many assume.”
So is there the possibility that polysilicon supply is going to be a problem in 2011?
Not so, noted Bernreuter to PV-Tech. As the PV industry continues its strongest growth cycle ever, the huge investments in new polysilicon production capacity are keeping pace.
According to the market research firm, solar-grade silicon supply for the PV industry will be equivalent to 27.5GW of crystalline modules in 2011. One of the most optimistic forecasts comes from Photon Consulting, which expects approximately 25GW installed next year. This would still be within the range of polysilicon production capacity, yet perhaps not in the margin of error or margin of excess capacity to keep polysilicon spot prices stable.
However, if we take 2011 forecasts that have been in the range of 15 to 20GW installed, ample polysilicon is available and prices should continue the trend down.
For Bernreuter, the total power of crystalline modules produced annually is a good indicator of the real PV market size. He noted that in five of the last six years, the production volume differed from the power of all newly installed crystalline and thin-film solar modules by less than 10%.
