In Italy, the fact that the money made available by the fifth Conto Energia was used up prematurely by the start of 2012 meant that the amount of new photovoltaic capacity installed in the country fell from 9.5 GW in 2011 to 3.4 GW in 2012. Here, political debates have prompted a drastic reduction in feed-in tariffs and in the middle of 2012, the government in Rome decided not to support any further ground-mounted solar parks.

In addition, all solar generators with outputs greater than 12 kW must be entered into a plant registry in the future. No restrictions are to be made on the installation of smaller systems. However, feed-in tariffs are being cut significantly: 3 kW installations will receive 23.7 euro cents, roof-mounted installations with an output of 200 kW 19.9 euro cents per kWh, and ground-mounted installations 16.1 euro cents per kWh. Experts anticipate that expansion in Italy will almost exclusively ensue from roof-mounted installations, though on roofs with sufficient surface areas, these are able to achieve outputs of several MW. The amount of new capacity installed is likely to amount to between 1.5 and 2 GW in 2013 and the years to follow.

912 MW was newly constructed in Greece, owing to the fact that the country’s sunny climate allows photovoltaics to act as an alternative to the increasing price of power generated from coal. Meanwhile, Bulgaria, another country with a high level of insolation, installed 767 MW. Despite its comparatively small size, Belgium installed 599 MW of capacity, mainly in the form of “small” roof-mounted systems.

Turkey has also introduced feed-in tariffs for solar power, as well as increased remuneration for using PV components manufactured within the country. However, the authorities require an extensive amount of supporting evidence before granting these incentives. High levels of insolation of up to 1,500 kWh per square meter in south and south-east Turkey also create favorable conditions for photovoltaics, and the Turkish market is expected to undergo a significant upturn. In order to minimize currency risk for foreign investors, the feed-in tariffs below are quoted in US cents. The government in Ankara pays 13.3 US cents (around 10 euro cents) for every kWh of solar power generated. Added to this are incentives for using components manufactured domestically, which amount to as much as 6.2 US cents. While plants with a rated output of less than 500 kW do not require any approval, licenses are required for larger power plants, and the addition of new capacity up to 2013 was limited to 600 MW. Moreover, individual plants may not exceed capacities of 50 MW. The electricity demand in Turkey is set to double by 2020, meaning that shortages in the power supply are expected from 2017. 200 MW of new capacity are expected to be installed in 2013, with these figures set to rise to 600 MW in 2014 and 1.2 GW in 2015. In contrast, only 2 MW of capacity were installed in the country in 2012.

The Balkan states are yet to play a significant role in the large-scale installation market. Falling system prices could, however, prompt moderate growth in Bulgaria (2012: 767 MW) and Slovenia (117 MW). Both countries have introduced feed-in tariffs which are significantly higher than those in Germany and Italy. In Ukraine, large-scale solar power plants with capacities of 100 MW were installed, predominantly in the southern regions around Odessa and along the Black Sea coastline.

The future course of development in Poland is rather uncertain, as although the government in Warsaw is working on a law to promote renewable energy that also intends to include a feed-in tariff for solar power, this shall not be passed before the government’s 2013 summer break. As a result of the weak grid, connecting large-scale power plants is expected to prove particularly problematic.

It can generally be assumed that the market for MW-scale installations in Europe will become increasingly difficult. However, the direct marketing of solar power modeled on the USA’s Purchase Power agreements is paving the way towards independence from government subsidies. The first of Germany’s solar power market sectors (in particular roof-mounted systems) are expected to fall below grid parity in 2013/2014. In Italy and Spain, this milestone has already been reached for ground-mounted photovoltaic systems. However, large-scale photovoltaic installations do not compete with the electricity price paid by end customers (private households and/or companies), but rather with the market price of peak load power.

North America

New solar parks are also being planned south of the border between the USA and Mexico with the aim of exporting solar power to the USA. Feed-in tariffs have either recently been launched or are due to be introduced in a few Caribbean countries. Puerto Rico, for example, intends to cover a third of its electricity demand of 3 GW with solar power by 2020.

In Canada, the province of Ontario, in particular, has seen a high number of new installations. However, the Green Energy Act introduced in 2009 expired in January 2012, and the government has announced plans to cut the feed-in tariffs by 20 percent. According to data from EPIA, around 268 MW of solar power were installed in Canada in 2012 (2011: 497 MW).

China may be the most important market of the future for photovoltaic power plants, but it is also the most challenging. According to data from EPIA and Solarbuzz, the Chinese photovoltaic market grew by 5 GW in 2012, meaning that the solar power plant capacity in the Middle Kingdom more than doubled in one fell swoop. Since the beginning of 2012, Beijing will pay one renminbi per kWh solar power (approximately 11 euro cents). The Chinese aim to install around 5 GW of capacity every year until 2015. Large solar farms make up the majority of new photovoltaic installations in China. While merely a few demonstration projects were installed between 2009 and 2011, the Chinese market is now on the verge of enormous growth. The majority of utility-scale plants are being installed in Western China, Inner Mongolia and Tibet. Here, the solar power plants belong to the state and are regarded as infrastructure projects, which are constructed through calls for tender.

The insufficient state of the power grid is the greatest hindrance to development. In the province of Qinghai, where roughly half of China’s large solar farms are located, around 1 GW of capacity was newly installed in 2012, but only 50 percent of it was connected to the grid in good time. Above all, there are not enough transformers for the 380 kilovolt (kV) transmission lines. In Tibet, the construction of a 220 kV line to connect additional solar power plants has been delayed.

Following the nuclear reactor disaster in Fukushima, Japan has rejoined the world’s largest solar nations. In 2012 2 GW of new solar capacity were installed (2012: around 1.3 GW). The Japanese market is similar to Germany’s, however, in that it is dominated by small roof-mounted installations. The on-site consumption of solar power is playing an increasingly significant role, as Japan has the highest electricity prices worldwide. All of its 45 nuclear power stations are not connected to the grid anymore, production capacities of conventional systems there have reached their limit. In the Greater Tokyo Area, industrial companies must reduce their electricity demand by around 15 percent or are forced to generate the same amount using their own solar power.

New, lucrative feed-in tariffs have been in effect since July 2012 which are boosting the market. Small private plants, on the other hand, are no longer receiving any remuneration whatsoever because on-site consumption allows them to pay for themselves. Ten Japanese energy suppliers are planning to make consider able investments in utility-scale solar farms. Feed-in tariffs have been introduced for both roof and ground-mounted installations of 10 kW and above. The tariffs are graded to ensure that large solar parks and B2B installations with large solar outputs will chiefly be developed. Remuneration is fixed for the solar power from each installation for ten years, after which it is phased out in several stages.

A feed-in tariff for solar power was introduced in Malaysia as early as at the end of 2011. Installations with outputs of more than 10 MW can expect to receive around 20 euro cents per kWh. However, solar farms with a total capacity of over 30 MW receive no subsidies whatsoever. A feed-in tariff amounting to around 60 euro cents per kWh has also been paid in the Philippines since the end of 2011. The country has been struggling with rising electricity prices, and discussions on whether to lower the tariff to approximately 30 euro cents are ongoing.

As of yet, the photovoltaic markets in Africa and South America have hardly got off the ground. In 2011 und 2012, Kenya and South Africa became the first African countries to install large plants. During the course of 2012, initial plans were drawn up to construct several solar power plants each with capacities greater than 70 MW. Thanks to its relatively well developed infrastructure, stable financial system and advanced grid, South Africa has been awarded the accolade of being the sunny continent’s market leader. Here, the World Bank plays a considerable role in funding the power plants.

In South America, further drops in the price of solar technology should stimulate significant market growth. Increasing attention is being paid to solar power plants in Chile and Brazil in particular. The sunny, dry plateaus of the Andes are particularly ideal for solar power plants. The first pilot power plant with an output of 1.4 MW, which supplies a nearby copper mine, was installed in northern Chile in 2012.

In addition to providing millions of people in South America and Africa with power for the first time, photovoltaic power plants on these continents also make it possible to provide precious drinking water at a low cost, support communication networks and store vital medicine and food in air-conditioned storage areas.

State of play: May 2013