solar pv
Image credit: Stock

Owing to governments and utility efforts to meet carbon-neutral targets, the solar PV capacity market could increase by three-fold in the Asia Pacific between now and 2030, according to a new study.

The research by Wood Mackenzie forecasts the market to reach 1,500 GWh by 2030. Distributed solar PV projects are expected to account for 51% of new installations as energy stakeholders seek to address land constraints.

The unavailability of large amounts of space to install massive solar projects continue to hinder the market. Improving competitiveness of distributed solar against rising tariffs is also expected to help expand the sector.

China, with strong national policy and lower tariffs, is expected to lead utility-scale deployments, which account for 53% of its total capacity additions this decade. Outside China, distributed solar is a more popular option, accounting for over 60% of solar PV new-build installations in the region.

Have you read?
EDP funds ease energy poverty in five African countries
Sunseap delivers offshore floating solar project in Singapore
Renewables growth too slow to stall coal bounce back says IEA

Wood Mackenzie consultant Xin Zhang said: “Policies are evolving to overcome market barriers, enabling Asia Pacific’s solar generation share to grow from 4% in 2020 to 10% in 2030,”

China, which is expected to continue leading the solar PV market by contributing 60% of the region’s market growth, is expected to add 619 GW in capacity followed by India with 138 GW by 2030.

India is anticipated to increase its installations as the country tries to recover from the disruptions caused by the pandemic, however, will not meet its 2022 target of 100 GW. Despite efforts anticipated to be put in place by India in installations, evidenced by tenders released, the Indian market sees low completion rates.

Japan is expected to install 63 GW whilst South Korea will contribute 58 GW. Although the high costs of solar PV projects in Japan have caused a slowdown in new additions, the country has one of the highest solar PV penetrations in power generation, growing to 13% share by 2030.

Xin Zhang, adds: “By 2030, Vietnam will have the second-highest solar PV penetration in power generation in the region. At 15% share of its total power generation, Vietnam is second only to Australia and will lead Japan.”

Since 2019, Vietnam has been the largest solar market in the Asia Pacific owing to feed-in-tariffs resulting in the country succeeding to install 5.5 GW in 019 and 13.8 GW in 2020.

However, installation is expected to slow in the next five years, and then gradually pick up due to the gap between subsidy phase-out and economical grid parity.

Australia is expected to install only 23 GW of solar PV capacity by 2030. State-level renewables target and green hydrogen potential could drive the country’s solar PV penetration in power generation to over 20% by 2030, making it the highest in the region.

Wood Mackenzie expects Indonesia to become the fastest-growing solar PV market in Asia Pacific over this decade. Growing from a low base of 0.3 GW, the country’s solar PV capacity could expand over 28-fold to 8.5 GW by 2030.

Find out more about the report.