2013 is not shaping up as much better than 2012. Major shifts in regional demand are underway, driven by where the subsidies are growing or declining. European demand is shrinking with reduced subsidy, but China has a profitable FIT and a goal of 10GW, and the generous FIT in Japan is projected to see 6GW installed. The Japanese growth will be met by Japanese panel makers despite their lack of market competitiveness, which may not help the PV business generally. Current panel prices combined with subsidies are also driving growth in the US(primarily California), which may see 5GW installed in 2013. The story is the same everywhere. Subsidies drive the market, and their amount determines the market size. The overall PV market is not likely to grow significantly in 2013 over 2012.
As prices stabilize, and even rise a bit to restore profitability, the historical learning curve of PV panel price versus cumulative volume is still holding up very well. This is important to understand as it establishes the realistic fundamentals that should drive expectations for what can be achieved by PV. There has been a tendency to take an optimistic view of PV competitiveness based on extrapolating short term trends, or localized successes (like Germany) driven by large subsidies. PV has made great strides, but is still only competitive with a large subsidy in normal geography, or with a smaller subsidy in a sunny geography like California. The historical learning curve will take many years of current production rates to get PV panel prices down to competitive levels.
To put things in perspective, PV on a world average has less than a 15% utilization. StratoSolar is 40% utilization on average. For ground PV panels to match StratoSolar, prices will have to more than halve from current levels to about $0.30/Watt. This will take a long time, perhaps decades. Itâs a catch 22 for ground PV. Prices will only fall with volume, but volume will only happen with lower prices.
StratoSolar competitive energy pricing has the potential to fundamentally change the energy market by driving PV volume installation now.
By Edmund Kelly