Global annual solar PV repairs and maintenance market to hit $9bn

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Annual solar PV repairs and maintenance spend will grow to $9 billion by 2025, according to a new study released by Wood Mackenzie.

Solar energy systems nearing inverter end of life currently sit at 5% of the global PV market and are expected to increase to 16% or 227GW of all solar systems by 2025.

Repairing and maintaining non-residential solar PV systems will generate $9.4 billion by 2025, of which $4.1 billion will come from the APAC region, $3.5 billion from the EMEA region and $1.8 billion from the AMER region

The research firm predicts that in 2020 alone, 4.2GW of solar PV systems will run premature failures. The capacity is expected to increase to 36GW in 2025.

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Solar inverters will need to be replaced every ten years.

Daniel Liu, a principal analyst with Wood Mackenzie, said: “Inverter repowering is especially important in Europe, as more than 16GWDC of systems are currently over ten years old. By 2025, that number will grow to 100GWDC. Aging solar systems are an opportunity for repowering activities, while new projects can take advantage of advanced analytics.”

Leila Garcia da Fonseca, Wood Mackenzie Principal Analyst, adds: “Premature inverter failures will grow as the global PV fleet ages. Though less than 1% of systems experience premature failure, between 10% ” 12% of O&M costs are dedicated to inverter replacements.”

The solar repairs and maintenance market is also expected to grow as global annual installations are expected to increase to 135GW between 2022 and 2025.

At the same time, the widescale adoption of auctions is driving solar LCOE further down and putting additional pressure on O&M costs, according to Wood Mackenzie.

“Europe has joined the markets that are phasing out renewable energy incentive schemes and introducing auction-based mechanisms. Auctions are emphasising the existent price-based competition for O&M services in established markets such as Germany.

“Developers and asset owners are exploring methods along the value chain to reduce overall costs, assuming more risk. In the O&M sector, this will happen through partnerships with different players oriented to a hybrid structure,” added Liu.

Another factor impacting O&M costs lies in the content of contracts signed by developers and asset owners.

In the long-term, asset owners are likely to incur more costs with an a-la-carte service structure than if opting for an all-in service contract, says Wood Mackenzie.

“In reality, most O&M contracts currently signed on the lower end of the cost range (3-5$/kW/year) miss vital aspects of operating and maintaining a solar power plant properly.

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