Both PV manufacturing and PV deployment are now dominated by China which significantly increased manufacturing capacity and almost doubled PV deployment in 2017. Bloomberg and others cannot predict China’s PV markets. Here is a Quote from the Bloomberg article.
“China’s boom, which saw an extraordinary 53GW installed in 2017, is still fundamentally irrational – the mechanism to collect the subsidies to be paid out has not been determined, and many of these projects are being built before they have secured ‘quota’ from the government to have access to the subsidy pool. However, it looks as if Chinese state-owned developers and investors will build them anyway, on the assumption that the government will find a way and, if not, compensation for the power itself will prevent a total loss.
A mandatory Renewable Energy Credit may be introduced in 2018 in China, and might answer part of the ‘where does the subsidy come from’ question. About half the new build in China will be distribution-grid-connected, ie smaller projects with the ability to sell to local power consumers. These are not subject to quota, but are limited by the ability of large developers to put together volumes of small deals.”
The PV market in China and worldwide is subject to the whims of government policy. The aggregate behaviour of China, the US and Europe has maintained a stable PV revenue stream since 2011. This has not been coordinated, other than China probably reacting to the drop in European demand by increasing Chinese demand to prop up Chinese manufacturers. As Bloomberg has stated, China’s future behavior is not predictable. If China maintains its current level of dollar commitment to PV deployment, PV panel prices will probably continue to fall as Bloomberg predicts but it is hard to see dramatic price reductions of the magnitude we have seen already happening again.
PV deployment is increasingly constrained by other costs which have not dropped at the rate of PV panels. Transmission, backup and storage costs loom as PV penetration increases. PV on its current path will not reduce CO2 emissions for a long time. Stratosolar can alter this dynamic.
By Edmund Kelly