Outlook for the solar industry
While solar power is an increasingly successful part of our country's energy landscape, the outlook for solar panels and their success in the sector is mixed for the next few years.
According to a report from NPD Solarbuzz, solar PV industry module revenues are set to decline by 20 per cent this year, to $20.5 billion down from 2012's $25.5 billion.
In 2014 levels of revenue are slated to remain low, but the outlook is not completely bleak as the industry should experience a revive come 2015 onwards.
NPD Solarbuzz's report suggests that PV revenue will reach $42 billion by the year 2017.
"Manufacturing over-capacity and declining revenues had a dramatic impact on the PV industry in 2012, and this trend will continue during 2013," said Michael Barker, senior analyst at NPD Solarbuzz.
"Share values of several publicly listed PV companies have been falling close to delisting levels, operating losses have been reported in the hundreds of millions of dollars per quarter, and many manufacturers are continuing to file for insolvency.
"Predicting how and when the solar PV industry will rebound to profitability has now become essential for all industry participants."
Despite warning of this downturn, it's evident Australian energy consumers have been increasingly turning towards technologies such as solar power to counter rising electricity prices, even if not at such a previously fast rate.
This is proven by Australia's recent milestone of reaching one million solar rooftop panel systems being installed nationwide.
NPD Solarbuzz suggests that confidence in the solar PV was damaged in 2012 as selling prices declined drastically as end-market demand only grew a very small amount.
This mismatch of priorities put pressure on the solar PV manufacturing sector, which according to NPD Solarbuzz had expanded its capacity during 2010-11 in order supply up to 45 GW to an end-market that reached only 29 GW in 2012.
However despite this, the long-term outlook for solar power and solar panels is positive.
The sector will build momentum back up again, as due to it being a clean and renewable form of technology, its status in an increasingly energy efficient focused world is sure to grow.
NPD Solarbuzz predicts that the industry will re-consolidate slowly through 2014 and from then on experience growth and get back to being a profitable sector as end-market demand approaches 46 GW in 2015.
Posted by Charlie Moore