The sleeping giant has finally awoken, according to the latest report from NPD Solarbuzz as PV installations in China reached 2.9GW in 2011, a massive 500% increase over 2010. The Asia Pacific region as a whole saw demand increase 165% year-on-year, reaching a total of 6GW. Like Germany, NPD Solarbuzz noted that 2.8GW of installations in the region were installed in the fourth quarter alone.
According to the market research firm, China has quickly emerged as the dominant force in the region, with 48% of 2011 demand. A planned year-end 13% FIT reduction led to a surge in installations in the fourth quarter, reaching 1.7GW, NPD Solarbuzz noted.
“The China PV market was reshaped in 2011 by the release of the national FIT,” said Ray Lian, analyst at NPD Solarbuzz, “Approximately 1GW ground mount projects were installed in the Qinghai province alone. However, the explosive growth could well be followed by policy adjustments in 2012 as the Chinese central government takes action to control the growth rate.”
However, the market research firm noted that low factory gate module prices and favorable project returns have led to a project pipeline that reached 20GW and in direct comparison the project pipeline estimates for the US.
Other major markets in the Asia Pacific region include Japan and India. Though dependent on the residential market (70% plus of installations), Japan installed 1.2GW in 2011, an increase of 30% over 2010.
However, NPD Solarbuzz expects the Japanese market to grow 40% in 2012 as a new FIT law aimed at large-scale PV projects should increase demand, though highlighted that the actual 2012 rates have yet to be announced.
Many forecasters had previously touted Japan to once again become a major growth market but a forecasted growth of 40% could disappoint many in the PV industry, especially considering the growth in overseas module suppliers moving into the Japanese market in anticipation of strong growth.
According to NPD Solarbuzz, demand in India increased by 125% in the fourth quarter, as install deadlines loomed in the first quarter of 2012. The market research firm expects 600MW to be grid connected in the first quarter under the National Solar Mission and Gujarat Solar Policies.
In 2012, the Indian market could begin to approach 1GW, driven by new installations under the National Solar Mission and new state-level policies.
"While rapid PV price declines have greatly improved project economics over the course of 2011, many Indian developers have suffered setbacks due to difficulties associated with financial closure, land acquisition, and power evacuation facilities. Now developers will need to race to meet their installation deadlines or face the prospect of losing their PPAs, leading to a surge of activity in December and January," added NPD Solarbuzz analyst Chris Sunsong.
Australia’s PV installations fell 10% quarter-on-quarter as incentive schemes were closed down. NPD Solarbuzz expected first quarter 2012 installs to make further declines of around 20%.
Worse, the market for 2012 is forecast to fall by 30%; however, the market is forecast to pick up in 2013 as large-scale ground-mounted systems begin to come online.
Thailand, Korea and Taiwan
Other emerging markets in Asia added 500MW of demand in 2011, largely driven by Thailand, Korea and Taiwan, noted the market research firm. Further growth of more than 50% is expected in 2012 as new markets in Malaysia and the Philippines evolve.
Government incentives and continued declines in module prices are set to underline the growth potential in this rapidly emerging important market for the PV industry.