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02 MARKET AND INDUSTRY TRENDS
SOLAR PHOTOVOLTAICS (PV)
SOLAR PV MARKETS
Solar PV experienced another year of record growth in 2015, with
the annual market for new capacity up 25% over 2014. 1 More than
50 GW was added – equivalent to an estimated 185 million solar
panels – bringing total global capacity to about 227 GW. 2 The
annual market was nearly 10 times the size of cumulative world
capacity just a decade earlier. 3 (p See Figure 14 and Reference
Table R6.) Although the top three markets in 2015 were responsible
for the majority of capacity added, globalisation continued with
new markets on all continents. 4
Until recently, demand was concentrated in rich countries; now,
emerging markets on all continents have begun to contribute
significantly to global growth, with solar PV taking off where
electricity is needed most: in the developing world. 5 At the same
time, however, many former gigawatt-sized markets in Europe
installed little to no capacity in 2015. 6 Market expansion in most of
the world is due largely to the increasing competitiveness of solar
PV, as well as to new government programmes, rising demand
for electricity and improving awareness of solar PV’s potential as
countries seek to alleviate pollution and CO2 emissions. 7
Asia eclipsed all other markets for the third consecutive year,
accounting for about 60% of global additions. 8 Once again,
China, Japan and the United States were the top three markets,
followed by the United Kingdom. 9 (p See Figure 15.) Others in the
top 10 for additions were India, Germany, the Republic of Korea,
Australia, France and Canada. 10 By end-2015, every continent
(except Antarctica) had installed at least 1 GW, and at least 22
countries had 1 GW or more of capacity. 11 The leaders for solar PV
per inhabitant were Germany, Italy, Belgium, Japan and Greece. 12
China’s central government continued to raise installation targets
to increase renewable generation, address the country’s severe
pollution problems and prop up the domestic manufacturing
industry. 13 In 2015, China added an estimated 15.2 GW for a total
approaching 44 GW, overtaking long-time leader Germany to
become the top country for cumulative solar PV capacity, with
about 19% of the world total. 14 (p See Figure 16.) The provinces of
Xinjiang (2.1 GW), Inner Mongolia (1.9 GW) and Jiangsu (1.7 GW)
were the top markets for the year, with much of this capacity far
from the country’s population centres. 15 However, six provinces in
east and central regions each had more than 1 GW of solar PV
capacity at year’s end. 16 Large-scale power plants accounted for
86% of total capacity, with the remainder in distributed rooftop
systems and other small-scale installations. 17
The rapid increase in solar PV capacity in China, up from only
7 GW at the end of 2012, has caused grid congestion problems
and interconnection delays in the country. 18 Curtailment started
to become a serious challenge in 2015, with particularly high
rates in the northwest provinces of Gansu (31% over the year)
and Xingjiang Autonomous Region (26%), and a national average
of 12%. 19 By year’s end, insufficient grid capacity was a significant
hurdle for new plants, and investors were growing wary of the
sector due to delays in subsidy collection and problems with
solar panel quality. 20 To address challenges related to curtailment,
China has urged top solar-producing provinces to prioritise
transmission of renewable energy, build more transmission
capacity and attract more energy-intensive industries to increase
local consumption. 21 Against these transmission and curtailment
challenges, solar PV generated 39.2 TWh of electricity in China
during 2015, up about 57% over 2014. 22
In Japan, the boom continued with as much as 11 GW added
to the grid, bringing total capacity to an estimated 34.4 GW. 23
Despite another year of record growth, the residential market
was relatively low for the second consecutive year, with 0.9 GW
connected to the grid. Commercial and utility-scale projects
again drove the market. 24 Due to limited availability of land,
developers turned to abandoned farmland and golf courses to
site large-scale plants (an idea spreading to the United States as
well). 25 Solar PV accounted for 10% of Japan’s electricity demand
on some of the hottest summer days, and represented 3% of total
power generation in 2015. 26
In only three years, Japan doubled its renewable energy capacity,
with solar PV making up the vast majority of the total. The large
volume of solar PV projects and their output has exceeded the
capacity of the grid, leading the government to revise regulations
and causing some utilities to refuse new interconnections and
to curtail output from existing plants without compensation. 27
However, many other entities, both domestic and foreign –
including telecommunications and gas companies, home
builders and others – scrambled to set up renewable energy
infrastructure and to begin buying solar PV-generated electricity
from homeowners in anticipation of the liberalisation of Japan’s
electricity market in April 2016. 28
Elsewhere in Asia, the largest annual market was India (2 GW),
ranking fifth globally for additions and tenth for total capacity. 29
India’s year-end capacity was over 5 GW, led by Rajasthan
(1,264 MW), Gujarat (1,024 MW) and Madhya Pradesh (679 MW). 30
Additions were well above 2014 but below expectations for
2015, due to project delays in several states. Even so, the
utility-scale pipeline grew rapidly, driven by the improving costcompetitiveness
of solar PV and by rising electricity demand. 31
While most added capacity was in large-scale ground-mounted
projects, India’s rooftop sector also expanded thanks to high
consumer awareness and favourable commercial tariffs in some
states. 32 The most immediate challenge for India’s solar sector,
and for scaling up solar power capacity to achieve the country’s
ambitious goals (100 GW by 2022), is congestion in the grid. 33
India was followed by the Republic of Korea, which added 1 GW
to end the year with 3.4 GW. 34 Pakistan’s market (an estimated
500 MW) took off in response to national FIT payments and other
incentives enacted to help alleviate chronic power shortages and
increase reliability. 35 Companies flocked to Pakistan, and China
played an increasingly important role in the country’s renewable
energy expansion, including solar PV. 36 Other Asian countries
with growing markets include the Philippines and Thailand (both
adding more than 100 MW). 37
Most of the approximately 20 GW installed outside of Asia was
added in North America and the EU. 38 North America added 7.9
GW in 2015. 39 Canada accounted for about 0.6 GW, for a yearend
total of 2.5 GW, with the rest brought online in the United
States. 40
The United States also had a record year, with solar PV installations
exceeding new natural gas capacity for the first time. 41 Nearly
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