The weak demand that has blighted the solar industry for much of 2011 is likely continue into the new year, according to a new report on the US market from ClearSky Advisors. Despite a growth in installed capacity, overcapacity in the supply chain will continue to affect module prices, with ClearSky forecasting these to fall for at least the first half of 2012.
Next year installed volume in the US will grow by 7% to 1.63GW, but falling equipment prices – especially for modules – means that overall market value for 2012 will be flat or may even fall in comparison to 2011.
It will not be until 2014 that market conditions begin to improve, as solar power weans itself off government subsidies and moves towards grid parity. And in order to capitalise on this upturn in fortunes, manufacturers will need to persevere with cost-cutting measures in the intervening period.
Nevertheless, opportunities for growth do exist. Due to the diversity in state-level solar policy throughout the US, ClearSky analyst Brennan Louw believes that by targeting certain states, particularly in the west and northeast of the country, manufacturers may be able to ride out this difficult period. “In 2012, the US PV market belongs to those equipment suppliers who are able to effectively target their market and calibrate their offering to local market dynamics” Louw said. “Simply having a presence in the California and New Jersey markets will not cut it going forward.”