The photovoltaic (PV) industry, with its environmentally friendly and cost-effective characteristics, is experiencing rapid growth worldwide. As countries increasingly prioritize environmental protection and the cost of photovoltaic power generation continues to decline, PV has emerged as the most affordable energy source in many countries and regions.
The declining trend in polysilicon prices is set to drive the demand for ground power stations, with domestic demand projected to reach over 160GW in 2023, marking an impressive 83% year-on-year increase. The establishment of the "1+N" policy system in 2021, which outlines a clear path to achieve carbon peak by 2030 and carbon neutrality by 2060, has further facilitated the development of the PV industry. Moreover, China’s efforts in constructing large wind and solar bases and implementing dual energy consumption control measures are expected to lead to significant improvements in PV installed capacity.
In 2023, the production capacity of polysilicon will be unleashed, leading to a balance between supply and demand. As prices decrease, the customer end’s return rate will rise, releasing the pent-up demand for ground power plants resulting from the high module prices during 2021 and 2022. We anticipate that in 2023, the domestic demand for ground power plants will exceed 80GW, a remarkable 120% year-on-year increase, with distributed PV exceeding 80GW, representing a growth of over 55% year-on-year. Overall, the domestic installed demand is expected to reach more than 160GW, an 83% year-on-year surge.
Solar and energy storage parity is projected to achieve the transition from being auxiliary energy sources to becoming the primary sources. We estimate that the global PV installed capacity will reach over 370GW in 2023, a 50% year-on-year increase, and soar to more than 570GW by 2025, reflecting a Compound Annual Growth Rate (CAGR) of 34% from 2022 to 2025. In 2023, European residential electricity prices saw a decline, resulting in a slowdown in the growth of the household PV installation market. The European Commission announced raising the total renewable energy target for 2030 from 32% to 42.5%. The reduction in module prices acts as an effective stimulus for the European high-priced market, facilitating the growth of the ground power plant market. In the U.S., the exemption of solar tariffs for Southeast Asia for two years has been beneficial, leading to the expected marginal recovery in U.S. export. Simultaneously, the implementation of the IRA local manufacturing rules supports the development of photovoltaics.
Demand in Asia, Africa, and Latin America is on the rise, and South Africa is grappling with a severe power shortage. Consequently, the government has taken measures, such as tax incentives, to boost the demand for photovoltaic energy. The Southeast Asian region’s energy transition and the surging demand for electricity contribute to the continuous strength of photovoltaic installed demand. Moreover, the increasing number of favorable overseas policies and the decline in prices of polysilicon and lithium carbonate point to a booming overseas demand for PV in 2023. Projections indicate that overseas installed demand can surpass 210GW in 2023, reflecting a growth of more than 35% year-on-year. On a global scale, the installed demand is anticipated to exceed 370GW (corresponding to a module demand of 450-480GW), representing a remarkable increase of over 50% year-on-year. Looking ahead, solar and energy storage resources boast exceptional endowments, while their costs are continuing to decrease rapidly. Additionally, solar and energy storage parity is expected to shift from being auxiliary energy sources to becoming the primary energy sources, which will create extensive growth opportunities for the industry. On a global scale, it is projected that the new installed capacity of PV will reach 477GW and 572GW in 2024 and 2025, respectively. Looking further into the future, by 2030, the new installed capacity of PV is estimated to reach an impressive 1,513GW.
