Solar PV Panel Market in India – 2019
Solar PV Panel Market in India is set for an attractive growth as the country still has to accomplish around 70 per cent of the 100 GW targets. This opens up lots of opportunity for solar pv panel manufacturers and suppliers over the coming years.
In a solar energy project, solar PV panels / modules accounts for around 60 per cent of the total project cost. With increasing penetration of solar power in Indian energy mix, the solar panel market is also seeing a tremendous growth over the recent past years. Currently, India ranks as the third largest solar energy market globally which complements the solar panel market growth in the country.
As of March 31 2019, the cumulative installed solar energy capacity in the country has crossed the 28 GW mark. In other words, the country still has to accomplish more than 70 per cent of the 100 GW solar energy capacity targets set for 2022. With India’s eagerness to achieve 70GW of target makes it stand out as one of the most attractive market for solar panels / modules manufacturers and suppliers in days to come.
Power Insight looked into the growth of solar panel / modules market in India while also analysing the solar pv panel price trends and market competitiveness.
Global Market Overview
The solar PV currently represents one of the fastest-growing sources of renewable energy in the world. Global Solar PV capacity has been estimated to be around 500 GW at the end of the first quarter of 2019 – as per various market reports.
Though, the year 2018 witnessed a fall in the demand however, market reports expects 2019 a comeback year for the sector. Various market reports predicts that the global solar PV market will see growth of around 25 per cent in 2019 and will install a total of around 130 GW worth of new solar capacity.
Asia region has been generating the highest demand for solar installations since last 5 years and will continue to be the leader with an estimated market share of around 55 per cent for the next five years too. China, India and Japan have been predicted to be the highest contributors – accounting for over 75 per cent of this capacity increase, according to various market reports.
Global Solar Pv Panel / Module Market
The worldwide market for solar PV panels / modules was estimated at US$ 188.5 billion between 2012 and 2017, according to GlobalData, the world’s leading data and analytics firm. GlobalData aggregates the global solar PV module market value to decline and likely to be USD 137.6 billion between 2018 and 2022.
Analysing the region wise market for solar pv panel / module in 2017, it reported that Asia-Pacific represented the largest share of solar PV panel / module market, registering 74.9 per cent of the global market share, followed by America with 15 per cent of global solar pv panel / module market share. While, Europe, Middle East and Africa region together accounted for remaining 10 per cent of the global solar PV panel / module market value.
While many market studies have reported that the global solar PV panel / module market is projected to decline over the coming years due to changes in financial support provided the governments, decline in technology prices, shift in focus towards grid infrastructure development, and growth of other technologies.
However these reports also suggest that the Asia-Pacific region that led the solar PV module market over the past years – will continue to lead the market. Although a drop in its share of the global market is on the card.
The market is likely to decline as China the largest market for solar PV, has proposed the removal of subsidies in 2018, which is expected to have a negative impact on the market over the coming years. Similarly Japan has reduced its feed-in-tariff rate for solar PV which is likely to cause the market to drop.
However, global efforts to reduce power sector carbon emissions and improve self-sufficiency are few primary drivers which will contribute to the continued deployment of solar PV in various nations across the world.
Top solar PV panel / module manufacturers that lead the global solar pv market are Canadian Solar, Jinko Solar, Yingli Green Energy, Hanwha SolarOne, JA Solar, Sharp, First Solar, Kyocera, Renesolar, SunPower and Trina Solar.
India Solar PV Panel / Module Market
Indian solar pv panel / module market has seen tremendous growth as the country has witnessed huge solar pv capacity additions in the last four years.
With mega solar power plants developing in India at a full swing backed by huge amount of domestic and foreign investments is good news for solar pv panel / module manufacturers and suppliers. This was also possible due to ease in land acquisition and other legal approvals from the central and state government. The governance of the market is maintained by large domestic and international project developers with partial intervention of government.
Solar pv panel market demand seems positive during 2019 as a positive market growth is on card. This is based on analysis of various market reports that says that over 400 MW of solar PV projects are in pipeline across India at the end of 2018.
In addition, solar pv panel market is also expected to see a boost in demand from the rooftop segment. With technological developments in solar rooftop PV segment such as Net-Metering, Feed-In Tariff, Accelerated Depreciation Mechanism, Generation Based Incentives, etc., have pressed the use of renewable solar energy at small scale and this is expected to boost the solar rooftop PV market – too, over the coming years.
Though solar pv panel market in India is set for a strong growth ahead, however, there had been some chaos in the market during the recent past. India that was the second largest solar market in the world till first half of 2018 has slipped to the third position.
Experts believe that the solar PV market in India will continue to face disorder for some time moving forward. The solar energy installations in the country weakened mainly due to imposition of the safeguard duty and the Goods and Services Tax (GST), among other issues.
Imposition of safeguard duty on imported solar pv panel was aimed at incentivising domestic manufacturing. Unfortunately, it led to an increase in tariffs as solar components have become more costly. Thus, resulting in the uncalled for delays as well as cancellation of many solar auctions.
According to certain market reports this duty levy could result into reducing the solar PV market demand in India by around 2 GW through to 2020.
However, as India is aspiring to reach it 100 GW of solar pv targets and still has a long way to go. The country will remain as one of the major region that will create a substantial demand for the solar pv panels market.
Solar PV Panel Technology Trends in India
The three major types of solar pv panel / module available in the Indian market are Mono-crystalline solar pv panel, Multi-crystalline or Poly-crystalline solar panel and Thin-film solar panel.
India, being a price sensitive market, the use of multi crystalline solar panel / module still leads the market. However, developers have seriously started considering mono crystalline solar pv panel for projects looking at the added advantages it offers.
Solar markets around the world are noticeably inclining towards mono crystalline solar panels technology. Recent trends in the Indian solar market have also shown a significant increase in market share of mono crystalline solar pv panels.
Mono crystalline panel’s offers high efficiency along with many more advantages over multi / poly crystalline panels. Increasing demand for energy efficiency and optimum resource utilization are set to propel the mono crystalline solar panel / module market growth in India.
Meanwhile, one of the most important aspects of mono crystalline panels is higher ROI along with reduced use of land when used in large-scale projects. Since, land availability has been one of the major challenges in India – mono crystalline panel’s market share is projected to witness gain over the coming years.
However, increasing investment toward utility installations coupled with declining component cost will keep the positive drive the polycrystalline solar PV module market for some time.
PV Panel / Module Price Trends – India
The decline in the cost of solar PV panel / module is one of the major factors driving the global solar PV market. If we look at the trends of solar panel prices – by 2014 the price of solar PV panel / module was reduced by 75 per cent, as compared to that in 2009.
This decline can be mainly attributed to the improvement in material efficiency, production optimization, and economies of scale.
Asia accounted for about two-thirds of the world’s solar photovoltaic additions for the last three to four years. In 2017, nearly 85% of the total addition came from the top five markets in China, the United States, Japan, India and the UK.
While the Indian solar market completely depends on the demand and module supply. The last few years’ trends show a huge market boom in the country. The growth during the period was majorly dependent on the supply of modules at the lowest prices leading to competitive environment in the industry.
As South East Asia – especially China has been the major supplier of solar pv panels to India – India has witnessed a declining price trends in solar pv panel / module space since 2014 till January 2019 with the increase in solar pv demand. The solar pv panel / module prices have seen decline of around 31 per cent during the period.
The CAGR of module prices have been estimated to -14.78 per cent year on year basis. If the trend continues, the pv panel / module prices are expected to fall down to approximately 8 cents by 2026.
As further analysed by the industry experts, the pv panels / modules prices trends in India have been in direct proportion to the demand trends. However, stable module prices are expected throughout the year, which is a direct result of continued high demand.
Way Forward:
Though the solar pv market in India suddenly witnessed a slowdown in Q3 of 2018 – irrespective of huge solar tenders and huge demand in the country. There are several reasons for this – such as currency depreciation, cancellation of auctions and tenders, re-negotiation of Power Purchase Agreements, Anti-dumping duties, GST ambiguity, etc.
Though, things have changed a little in the Indian solar industry after the imposition of the safeguard duties. The market witnessed a little rearranging when it comes to solar pv panels / modules suppliers, while others have consolidated their positions. No doubt, the imposition of the safeguard duty has helped domestic solar pv panel / module manufacturers seize a larger share of the market in 2018 as compared to 2017.
India solar pv market is growing at a remarkable pace. If the growth trend continues at the current pace, the country is expected to achieve its 100 GW targets by 2023-24. Most importantly, the on-going developments and projects in pipeline show a positive growth trajectory ahead for solar pv market in India and bodes well for solar pv panel demand in the market.
