INDUSTRY INFORMATION
Energy demand
Electricity consumption is strongly influenced by
economic and population growth in the world’s
developing economies. Demand for electrical power is
projected to nearly double between 2004 and 2030,
growing at a 2.6% average annual rate from 17,408
TWh to 33,750 TWh. Demand increases will be most
dramatic in developing countries where some two
billion people still lack access to electricity, and
addressing that issue is a high public priority.
With the United Nations predicting world population
growth from 6.4 billion in 2004 to 8.1 billion by
2030, energy demand will also increase
substantially. Population growth and rising
standards of living in developing countries will
drive a 53% increase in energy demand between 2004
and 2030. The US Department of Energy predicts
world energy consumption will grow 71% by 2030.
Solar energy industry trends
Solar energy offers a clean, safe alternative to
energy produced from coal, oil or natural gas.
Electricity is produced at low variable costs and
solar energy plants don’t emit carbon dioxide.
Despite these advantages, solar energy currently
accounts for only 0.04% of the world's energy usage.
Solar photovoltaic (PV) installations worldwide
reached a record high of 1,744 megawatts (MW) in
2006 and were up 19% from the prior year. An EPIA/Greenpeace
report forecasts 35% annual growth in the worldwide
PV market through 2009 and 26% annual growth between
2010 and 2015.
With government support in more than 40 markets,
end-user demand for solar power significantly
exceeds production capacity. CLSA Asia-Pacific
Markets estimates volume growth of at least 30%
annually through 2010. This sector is poised to grow
four-fold from 1.5 Gigawatts in 2005 to at least 6
Gigawatts in 2010. The European Photovoltaic
Industry Association reached the same conclusion in
their published outlook for the global PV
(photovoltaic) market.
Global annual PV installation capacity
Source: www.epia.org
According to the US Energy Information
Administration, each year roughly 100 Gigawatts (GW)
of incremental electricity-generating capacity are
added globally. Most of this capacity is powered by
coal, natural gas, nuclear or hydro-electricity. In
2006, solar power accounted for only about 1.5% or
1.8 GW of new installed capacity. Solar energy’s
share is expected to increase to 5% by 2010 and
15-20% by 2015.
Worldwide photovoltaic sales were approximately $16
billion in 2006 and have grown 40% annually since
1997. Sales are projected to reach $36 billion in
2010 and exceed $50 billion in 2020 (http://www.bine.info/pdf/infoplus/SunScreenII.pdf).
Worldwide photovoltaic sales, $ billion
Germany, Japan and the US are the largest PV
markets. Together, these three countries represent
1.3 GW of a total 1.8 GW global installed capacity.
Germany's grid-connected PV market grew 16% in 2006
to 960 Megawatts and now accounts for 55% of the
world PV market. While Japan's market size barely
advanced last year, Spain and the United States were
strong performers. Spain’s market grew 200% in 2006
while the US market grew 33%.
Tight poly-silicon supplies
Silicon is the basic material used in the production
of solar cells based on crystalline technology,
which account for more than 90% of the world market.
Silicon usage has increased from 14,000 tons in 2004
to 19,000 tons in 2006. Solar-grade silicon prices
have risen as well: from $24/kg in 2003 to $50/kg in
2006. Demand continues to significantly exceed
silicon supply. Production of solar cells based on
non-silicon technologies is rising as a result of
tight silicon supplies and soaring silicon prices.
Production of non-silicon-based solar products
increased from 70 MW in 2004 to 140 MW in 2005 and
240 MW in 2006.
Silicon shortages and rising prices are compressing
the margins of solar cell manufacturers who rely on
poly-silicon semiconductor materials, despite strong
demand for solar photovoltaics. Because CNUV’s solar
cells can use cadmium and telluride materials, the
Company will not be impacted by silicon shortages
and may actually benefit from market share gains
made at the expense of higher- cost solar cell
manufacturers.
High oil prices
Rising oil prices make solar energy an increasingly
attractive and affordable power alternative. After
surging nearly 58% in 2007 (the biggest annual
gain in a decade), crude oil prices have
consistently traded well over $100 a barrel in
2008.
The International Energy Agency recently announced
its 2008 forecast, indicating global oil demand will
rise 2.3% in 2008 to 87.7 million barrels a day. The
Energy Information Administration’s (EIA) projects
world oil demand will grow much faster than non-OPEC
supply, leaving OPEC and inventories to make up the
difference.
Industry analysts expect oil prices to remain high
for the foreseeable future and some experts predict
prices will continue rising to record levels for the
foreseeable future. The Director of the
International Energy Agency expects oil prices to
reach continued record levels because of booming
demand from India and China.
