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Global PV demand to reach record 113GW in 2018 – IHS

Demand is forecast to be driven by China, with India seen overtaking the US as second largest market

Global solar photovoltaic demand is expected to reach another annual record of 113GW this year, boosted by strong demand anticipated in China, according to researchers from IHS Markit.

Continued policy support in China and a successful transition from a market that had been dominated by large ground-mounted projects are seen keeping demand strong, and drive to new heights in the fourth quarter with 34GW in the PV installations expected.

“This latest forecast is close to the global polysilicon limit manufacturers can supply,” said Edurne Zoco, research and analysis director for IHS Markit.

“Tight supply and stable prices will continue throughout the year. Our forecast assumes manufacturers can further ramp up production, to meet demand, in the second half of the year.”

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According to the latest edition of its PV Installations Tracker, global solar installations will grow by 19% this year after a 20% rise in 2017.

Module availability will once again be the limiting factor, the researchers says, while prices may limit investment returns on solar projects already under contract to sell electricity at low prices.

“Demand is not only picking up in China, but also in India, where developers want to secure modules before any additional tariffs are introduced,” Zoco said.

“The United States continues to import modules, despite the latest import tariffs. In emerging markets, countries like Egypt, Brazil and Mexico have large PV projects requiring modules in 2018. Several projects that were postponed in 2017, due to high module prices, will need to be installed this year.”

Chinese demand is expected to reach 53GW - with an upside potential of 60GW in 2018.

“This year China will have feed-in tariff deadlines in the second and fourth quarters, which will create two sharp installation peaks,” Zoco said.

India is forecast to overtake the United States as the second largest PV market. Even if project profitability remains highly sensitive to module pricing, the fear of possible future import tariffs is likely to drive developers to complete installations in 2018.

Emerging solar markets Mexico and Egypt will make up 1.8% and 1.3% of the solar market, respectively, replacing South Korea and the UK in the ranking of the 10 largest PV markets, in terms of annual PV installations.

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