The prospect of PV in the EU by 2015

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Written by Photovoltaics market development in Europe

In the past decade, the market for photovoltaic (PV) has experienced unprecedented growth. In particular, during the last year, the photovoltaic market reached a total installed capacity of about 40 GW worldwide, with an annual added capacity of 16.6 GW. Photovoltaic energy is on track to become fully competitive element of the energy system in the European Union (EU) and the growing energy source worldwide. However, this development was very diverse depending on the country. Progress in the development of PV market depended largely on national rules, incentive systems and the availability of funds. These are the basis for the development of the EPIA perspectives in the development of PV by 2015 (based on internal analysis of market data from members of industry, national associations, government agencies and electrical equipment), Paris, March 2011.

In 2010, the EU was the largest market for photovoltaics in the world. The total value amounted to a total installed capacity of 30 GW. The wealth of Europe has a unique market segmentation: technologies from small domestic systems to large fixed installations permit the development of different variants for different geographic regions.
In some cases, lack of sustainable support mechanism prevented balanced market segmentation and geographically homogeneous development. Building confidence in PV technology and increase of public awareness of the potential of this technology takes a long time. A German market is a good example, where small and medium-sized plants are built by individual customers, for which confidence in the technology is essential. Examples of Spain and the Czech Republic, equally dominated by big players and big ground-based systems show the contrast: the apparent lack of balance between the segments led to a lack of awareness among residents and politicians. In many EU countries it is characteristic to promote one or another segment of the market, according to national specific charakter and regulations regarding the use of agricultural land. Small residential installations can be seen as a possible factor in the rebirth of the markets in which the development of PV has collapsed, as in the Czech Republic and Spain.
As regards the number of installations it should be noted, that at present there are over 1 million PV installation. This large number is mainly connected with the rapid development of small residential installations in Germany. These differences are further evident in the power of the installed systems. While in the Czech Republic about 13 000 installations produce about 2 GW, whereas in Flanders 96 000 installations produce only 700 MW.
In 2010, photovoltaics has been the leading renewable energy technology in the field of productivity growth in Europe. Photovoltaics in 2010 won second place in the ranking with 13.3 GW of installed capacity, compared to 9.3 GW of wind power installations (third place) or to 18 GW of gas fired plants.

It is very unlikely that a significant rate of growth in the PV market in the EU market in 2010 could be maintained in coming years. This can be explained most easily by the opposition for photovoltaics in many countries, including some of the most promising markets. At best, EPIA expects at most stabilize the rate of growth in the EU in 2011 and 2012, before regaining power in 2013.
2010 was a year of national action plans on renewable energy (NREAPs) in Europe.
Although NREAPs impose an obligation on Member States to have regard to the share of renewable energy in national energy portfolio, compared to the goals of photovoltaic industry, this obligation is not a real lever for a broad market introduction of photovoltaics. Currently, the assumptions of national plans NREAPs, it is expected that the total installed capacity by 2020 will reach total of 84.38 GW.

The report "Set for 2020" prepared by the EPIA shows three scenarios for the development of PV, which reflect the true potential of technology:

• baseline scenario - assumes the normal behavior of the market (business-as-usual), which resulted in 4% of the demand for electricity will be supplied by PV in the EU, in 2020.
• advanced scenario - implies that photovoltaics will provide 6% of electricity demand. This assumption is based on the maximum possible increase in PV in the EU, without major changes in the development of electricity infrastructure.
• paradigm shift scenario - the third case, which assumes that all barriers are eliminated, while certain border conditions are fulfilled, than photovoltaics will provide up to 12% of the EU electricity by 2020.

In comparison to earlier forecasts EPIA set for 2015 the results are as follows:

• moderate scenario 2015 - looks to be most similar to the 2020 baseline scenario with 4% target. Although the moderate scenario assumed a bit smaller than 4% target, however, it appears reasonable to expect that the development of PV would reach this level, even in the case of slow growth.
• policy-driven scenario in 2015 - assumes data close to the paradigm shift scenario. However, in order to achieve a growth of 390 GW in the EU in 2020, the rate of growth would be higher than that assumed in the projections for 2015. However, while the 6% target by 2020, assumed by the advanced scenario is a coherent and achievable for 2015, than achieving the 12% in the paradigm shift scenario of would require strong support and incentives, even after gaining networks parity in many countries or segmented markets.