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Report: Aesthetics, Economics Adding Juice to Solar Market

Tuesday, April 5, 2011

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The worldwide solar-energy market is evolving rapidly, with a shift seen from a “supply-driven business with unsustainably high module selling prices” to one that is “demand-driven” with cost per watt and module efficiency becoming the primary factors in determining market winners.

Meanwhile, the market also is getting juiced by “substantially improved” aesthetics of photovoltaic products, with the arrival of new solar tiles and shingles that blend into rooftops and crystalline-silicon solar panels in various shapes, sizes, colors, transparencies, and patterns.

Those are among the key findings of a new report from Pike Research on the rapidly evolving dynamics of the building-integrated photovoltaics (BIPV) and building-applied photovoltaics (BAPV) markets. 

The firm, based in Boulder, Colo., issued “Building-Integrated Photovoltaics,” a report that examines the expanding global markets for BIPV and BAPV, including a comprehensive analysis of demand drivers and economics, technology issues, and key industry players.

Lower Costs to Drive Growth

Pike Research, which bills itself as a ”cleantech market intelligence firm,” forecasts that, driven mainly by lower costs, the global BIPV market will see strong growth in the coming years, with annual wholesale revenues rising from $744 million in 2010 to nearly $4 billion in 2016, under a base-case scenario. A more aggressive growth forecast contemplates that the BIPV market could reach $5.8 billion during the same period.

“The cost per watt for BIPV is declining quickly, and this trend will accelerate demand for building-integrated and building-applied solar products,” said Pike Research Senior Analyst Peter Asmus. “We expect that the cost per watt for BIPV/BAPV will likely reach $2.50 per watt by 2016.

Declining per-watt costs and enhanced aesthetics will drive accelerated growth in the solar-energy market, Pike Research says in a new report. Above: A building-integrated photovoltaics (BIPV) installation.

“In addition, the aesthetics of BIPV/BAPV are improving, and there are now solar tiles and shingles that blend into rooftops and crystalline-silicon (c-Si) solar panels in various shapes, sizes, colors, transparencies, and patterns that appear to seamlessly blend into a building’s structure.”

Asmus adds that efficiency improvements in both c-Si and flexible thin-film panels and shingles (led by CIGS panels) have improved BIPV/BAPV project return and payback periods. Asmus added that incremental efficiency improvements are seen as likely to continue through 2016. These enhancements will inspire normal building-materials suppliers—and eventually common residential market retailers—to market BIPV/BAPV solar products on an increasing scale, he said.

Improved Aesthetics, Financial Incentives Cited

The report says cost per watt of BIPV/BAPV installations plunged in 2009 and early 2010 with the “fundamental shift of the solar market from supply-driven to demand-driven.” In addition, the report notes that the aesthetics of these materials “have substantially improved. There are now solar tiles and shingles that blend into rooftops and c-Si solar panels in various shapes, sizes, colors, transparencies, and patterns that appear to blend seamlessly into a building’s structure.”

Other market drivers, the report says, are:

• “feed-in tariffs” (FITs) that provide homeowners or businesses a financial incentive for installing renewal-energy systems;

• efficiency improvements in C-Si modules and flexible thin-film panels and shingles;

• increased availability of BIPV/BAPV solar products at conventional building-materials suppliers; and

• increased ease of installation by competent roofers and construction trades.

Several novel products “stand out” as examples of “much-improved” aesthetics, lower roof loading, and ease of installation, including frameless, glass-on-glass c-Si modules that offer varying levels of transparency, a selection of colors and patterns, and unobtrusive supports and electrical connection.

“Dow Solar Solutions’ solar shingles…could be a game-changer in the BIPV/BAPV rooftop market,” with simplified installation that allows installation of shingles that simultaneously connect mechanically and electrically, the report says.

Bullish Growth Prospects

Pike Research said it anticipates that the European Union (primarily Germany and France) will continue to lead the BIPV/BAPV market in terms of megawatts installed per year. The region, however, will decrease in market share—from 55% in 2009 to 32% in 2016—as demand surges in Asia Pacific and North America. By 2016, the firm expects that demand in Asia will exceed that of Europe, topping 800 megawatts per year.

The report includes base-case and upside scenario forecasts for BIPV/BAPV installed capacity by world region and technology, along with forecasts of wholesale market revenues through 2016. An Executive Summary of the report is available for free download on the firm’s website.