PVPS Trend Report 2022

Task 1 Strategic PV Analysis and Outreach
PVPS
TRENDS IN
PHOTOVOLTAIC
APPLICATIONS
2022
REPORT IEA PVPS T1-43:2022
PHOTOVOLTAIC POWER SYSTEMS TECHNOLOGY COLLABORATION PROGRAMME

WHAT IS IEA PVPS TCP?
The International Energy Agency (IEA), founded in 1974, is an that may be research projects or activity areas. This report
autonomous body within the framework of the Organization has been prepared under Task 1, which deals with market and
for Economic Cooperation and Development (OECD). industry analysis, strategic research and facilitates the exchange
The Technology Collaboration Programme (TCP) was created and dissemination of information arising from the overall IEA
with a belief that the future of energy security and sustainability PVPS Programme.
starts with global collaboration. The programme is made
up of thousands of experts across government, academia, The IEA PVPS participating countries are Australia, Austria,
and industry dedicated to advancing common research and the Canada, Chile, China, Denmark, Finland, France, Germany,
application of specific energy technologies. Israel, Italy, Japan, Korea, Malaysia, Mexico, Morocco, the
Netherlands, Norway, Portugal, South Africa, Spain, Sweden,
The IEA Photovoltaic Power Systems Programme (IEA PVPS) Switzerland, Thailand, Turkey, and the United States of
is one of the TCP’s within the IEA and was established in 1993. America. The European Commission, Solar Power Europe, the
The mission of the programme is to “enhance the international Smart Electric Power Alliance (SEPA), the Solar Energy Industries
collaborative efforts which facilitate the role of photovoltaic solar Association and the Solar Energy Research Institute of Singapore
energy as a cornerstone in the transition to sustainable energy are also members.
systems.” In order to achieve this, the Programme’s participants
have undertaken a variety of joint research projects in PV power Visit us at: www.iea-pvps.org
systems applications. The overall programme is headed by an
Executive Committee, comprised of one delegate from each
country or organisation member, which designates distinct ‘Tasks,’
AUTHORS
Main Authors: Gaëtan Masson (Becquerel Institute), Izumi Kaizuka (RTS Corporation).
Analysis: Izumi Kaizuka (RTS Corporation), Elina Bosch, Gaëtan. Masson (Becquerel Institute), Caroline Plaza (Becquerel Institute
France), Alessandra Scognamiglio (ENEA), Arnulf Jäger-Waldau (EU-JRC), Johan Lindahl (Becquerel Institute Sweden),
Eddy Blokken (SERIS).
Data: IEA PVPS Reporting Countries, Becquerel Institute (BE), RTS Corporation (JP) and Arnulf Jaeger-Waldau (EU-JRC),
For the non-IEA PVPS countries UNEF (ES). For the other European Union countries: EU-JRC. For floating PV data: SERIS (SG).
For the non-IEA PVPS countries: BSW, UNEF.
Editor: Gaëtan Masson, IEA PVPS Task 1 Manager.
Design: Boheem
DISCLAIMER
The IEA PVPS TCP is organised under the auspices of the International Energy Agency (IEA) but is functionally and legally
autonomous. Views, findings and publications of the IEA PVPS TCP do not necessarily represent the views or policies of the
IEA Secretariat or its individual member countries Data for non-IEA PVPS countries are provided by official contacts or experts
in the relevant countries. Data are valid at the date of publication and should be considered as estimates in several countries
due to the publication date.
ISBN ISBN 978-3-907281-35-2: Trends in Photovoltaic Applications 2022.

IEA PVPS TRENDS IN PHOTOVOLTAIC APPLICATIONS 2022
REPORT SCOPE AND OBJECTIVES
The Trends report’s objective is to present and interpret prices varies, depending on the willingness of the relevant national
developments in the PV power systems market and the PV industry to provide data. This report presents the results of the
evolving applications for these products within this market. 25th international survey. It provides an overview of PV power
These trends are analysed in the context of the business, policy systems applications, markets and production in the reporting
and nontechnical environment in the reporting countries. countries and elsewhere at the end of 2021 and analyses trends in
the implementation of PV power systems between 1992 and 2021.
This report is prepared to assist those who are responsible for Key data for this publication were drawn mostly from national
developing the strategies of businesses and public authorities, and survey reports and information summaries, which were supplied by
to support the development of medium-term plans for electricity representatives from each of the reporting countries. Information
utilities and other providers of energy services. It also provides from the countries outside IEA PVPS are drawn from a variety of
guidance to government officials responsible for setting energy sources and, while every attempt is made to ensure their accuracy,
policy and preparing national energy plans. The scope of the the validity of some of these data cannot be assured with the same
report is limited to PV applications with a rated power of 40 W or level of confidence as for IEA PVPS member countries.
more. National data supplied are as accurate as possible at the
time of publication. Data accuracy on production levels and system
ACKNOWLEDGMENT
This report has been prepared under the supervision by Task 1 participants. A special thanks to all of them. The report authors also
gratefully acknowledge special support of Eddy Blokken from SERIS.
1
FOREWORD
The annual PV market reached 175 GW worldwide in 2021. While With this broader integration, the question of access, management,
the world was facing the second year of a pandemic and despite and financing of the grid will become a key challenge.
the end-of-year disruptions in Asia, the photovoltaic market The electrification of the transport sector, as well as storage
continued growing. Without these drawbacks, it probably could capacities and the production of green hydrogen, will increase the
have reached 200 GW. This is an exceptional result: 945,7 GW of demand for low-carbon electricity. The competitiveness also paves
PV power plants were producing electricity worldwide at the end of the way for further integration in buildings, vehicles, infrastructure,
the year, of which around 70% have been installed during the last and cross-cutting applications with nearly every energy‑consuming
five years. Over the years, an increasing number of markets have sector. One of the most promising hybrid segments is called
started contributing to global PV installations, and 2021 closed with AgriPV, which combines agriculture with energy production.
a record number of new countries installing significant numbers While still a niche market at this point, AgriPV shows significant
of PV. The upward trend in module prices observed at the global development potential.
level at the end of 2021, related to stress on several raw materials
markets, has not affected the competitiveness and development of The social acceptance of the energy transition is a major issue and is
the market. PV’s role in the global transition to low-carbon energy becoming a key subject for the development of PV. It is multifaceted:
is confirmed. 1200 TWh are produced annually by PV plants, the economic, social, societal, and environmental, but also aesthetic.
equivalent of the combined annual consumption of Germany, PV is a major contributor on the road to sustainability: the nature
France, Spain, and Belgium. The PV capacity globally avoided no of the energy transformation, and the acceptance of change are
less than one billion tons of CO2, equating roughly to 3% of annual essential elements in the success of this revolution: dealing with
global emissions, which reached 33 Gt in 2021. PV is thus already the number of jobs concerned, the impact on the environment and
a key decarbonization power source. the social aspects linked to the development of PV has become
unavoidable. Ensuring a local development of the PV industry and
The rapid decline in PV prices over the past years, despite the improving the use of resources is part of the response to the need
conjectural recent price increase, has enabled PV systems to for PV to be more virtuous than the energy sources that it replaces.
achieve competitive prices in several countries. The possibility
of developing photovoltaic systems with limited or no financial In 2022, photovoltaic technology has become increasingly
incentives is now an observable reality. Long-term private a source of affordable, local, and low-carbon energy. In the context
contracts (PPA) and the sale of electricity on wholesale markets of geopolitical tensions and resource scarcity, PV could become a
have been observed in an increasing number of countries in stabilization element, promoting peace through reduced tensions in
2021. This growing competitiveness has also boosted the share energy markets while accelerating the development of the world.
of PV installations operating under self-consumption without any
financial support mechanism. If electricity prices should remain at Gaëtan Masson Daniel Mugnier
the high level experienced in 2022 in several places around the Manager Task 1 Chair
world in 2022, especially in Europe, the question of competitiveness IEA PVPS Programme IEA PVPS Programme
would change completely: without any support scheme limitations,
the potential of the PV market seems virtually unlimited.
2
TABLE OF CONTENTS
FOREWORD2
INTRODUCTION TO THE CONCEPTS AND METHODOLOGY 5

PV TECHNOLOGY 5
PV APPLICATIONS AND MARKET SEGMENTS 6
METHODOLOGY FOR THE MAIN PV MARKET DEVELOPMENT INDICATORS 8
PV MARKET DEVELOPMENT TRENDS 9

THE GLOBAL PV INSTALLED CAPACITY 9
PV MARKET SEGMENTS 16
EMERGING PV MARKET SEGMENTS 19
OFF-GRID MARKET DEVELOPMENT 22
PV DEVELOPMENT PER REGION 22
POLICY FRAMEWORK 31
PV MARKET DRIVERS AND SUPPORT SCHEMES 33
PROSUMERS AND ENERGY COMMUNITIES’ POLICIES 38
ENERGY TRANSITION POLITICS 40
INDUSTRIAL AND MANUFACTURING POLICIES 42
TRENDS IN PV INDUSTRY 43
THE UPSTREAM PV SECTOR 43
THE DOWNSTREAM PV SECTOR 53
SOCIETAL IMPLICATIONS OF PV AND ACCEPTANCE 55

ACCEPTANCE OF PV DEPLOYMENT 55
CLIMATE CHANGE MITIGATION 57
VALUE FOR THE ECONOMY 58
AESTHETICS AND LANDSCAPE 64
COMPETITIVENESS OF PV ELECTRICITY IN 2021 65

MODULE PRICES 65
SYSTEM PRICES 68
COST OF PV ELECTRICITY 70
PV IN THE ENERGY SECTOR 75

PV ELECTRICITY PRODUCTION 75
PV INTEGRATION AND SECTOR COUPLING 79
ANNEXES81
LIST OF FIGURES84
LIST OF TABLES 85
3
TRENDS IN PHOTOVOLTAIC APPLICATIONS // 2022
PHOTOVOLTAIC POWER SYSTEMS PROGRAMME WWW.IEA-PVPS.ORG
TOTAL BUSINESS VALUE IN PV SECTOR IN 2021
$190 BILLION USD TOP

PV MARKETS IN 2021
5 CHINA
EU
USA
INDIA
JAPAN
54.9 GW
28.7 GW
26.9 GW
13.4 GW
6.6 GW
PV CONTRIBUTION TO ANNUAL INSTALLED

ELECTRICITY DEMAND CAPACITY IN 2021 (GW)
174GW
5%
Share of PV in the
GLOBAL PV
946GW
2021
global electricity CAPACITY

demand in 2021 END OF 2021 772GW GLOBAL PV CAPACITY
END OF 2020 (GW)
YEARLY PV INSTALLATION, MODULE PV PRODUCTION AND MODULE PRODUCTION CAPACITY 2011-2021 (GW)
CLIMATE CHANGE 600
IMPACTS 500
1060
million tons of CO2
400
GW 300
saved in 2021 200
100
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Yearly PV installations Total module PV production Total module production capacity
PV PENETRATION PER CAPITA IN 2021
PV penetration
(Wp/capita)
1011
506
0 or NA
42 COUNTRIES PV POWER PER CAPITA 18 COUNTRIES

REACHED AT LEAST INSTALLED AT LEAST
1. AUSTRALIA (1 011 Wp/cap)
1 GWp
IN 2021
2. THE NETHERLANDS (818 Wp/cap)
3. GERMANY (718 Wp/cap)
4. JAPAN (622 Wp/cap)
1 GWp
IN 2021
5. BELGIUM (620 Wp/cap)
SOURCE IEA PVPS & OTHERS
4
one
INTRODUCTION TO THE
CONCEPTS AND METHODOLOGY
PV TECHNOLOGY
Photovoltaic (PV) devices convert light directly into electricity Currently, c-Si technologies account for more than 95% of the
and should not be confused with other solar technologies such overall cell production. Monocrystalline PV cells, formed with
as concentrated solar power (CSP) or solar thermal for heating wafers manufactured using a single crystal growth method, feature
and cooling. The key components of a PV power system are commercial efficiencies between 20% and 25% (singlejunction).
various types of photovoltaic cells (often called solar cells) They have gained the biggest market share in recent years, over
interconnected and encapsulated to form a photovoltaic module 85% of the c-Si share. Multicrystalline silicon (mc-Si) cells, also
(the commercial product), the mounting structure for the module called polycrystalline, are formed with multicrystalline wafers,
or array, the inverter (essential for grid-connected systems and manufactured from a cast solidification process. They are still in
required for most off-grid systems), the storage battery and production due to their lower production prices. Nevertheless,
charge controller (for off-grid systems but also increasingly for they are less efficient, with an average conversion efficiency of
grid-connected ones). around 18%-21% in mass production (single-junction).
Thin-film cells are formed by depositing extremely thin layers of

CELLS, MODULES AND SYSTEMS photovoltaic semiconductor materials onto a backing material such
as glass, stainless steel or plastic. III-V compound semiconductor
Photovoltaic cells represent the smallest unit in a photovoltaic PV cells are formed using materials such as Gallium Arsenide
power producing device. Wafer sizes, and thus cell sizes have (GaAs) on Germanium (Ge) substrates and have high conversion
progressively increased, as it is commonly considered by industrial efficiencies from 25% up to 30% (not concentrated). Due to their
actors as an easy way to improve cell and modules wattage. high cost, they are typically used in concentrated PV (CPV) systems
Nowadays, wafer sizes range from 156,75 x 156,75 square mm with tracking systems or for space applications. Thin-film modules
(named M2) up to 210 x 210 square mm (named M12). To this used to have lower conversion efficiencies than basic crystalline
date, there is no standard in the wafer size. Nevertheless, silicon technologies, but this has changed in recent years. They are
M10 wafers (182 x 182 square mm) and M12 have gained a lot of potentially less expensive to manufacture than crystalline cells
traction in the last year. In general, cells can be classified as either thanks to the reduced number of manufacturing steps from
wafer-based crystalline silicon c-Si (mono- and multi-crystalline), raw materials to modules, and to reduced energy demand.
compound semiconductor (thin-film), or organic.
5
PV TECHNOLOGY / CONTINUED
Thin‑film materials commercially used are cadmium telluride Single or two-axis tracking systems have recently become more
(CdTe), and copperindium-(gallium)-diselenide (CIGS and CIS). and more attractive for ground-mounted systems, particularly for
Amorphous (a-Si) and micromorph silicon (μ-Si) used to have PV utilization in countries with a high share of direct irradiation.
a significant market share but failed to follow both the price of By using such systems, the energy yield can typically be increased
crystalline silicon cells and the efficiency increase of other thin by 10-20% for single axis trackers and 20-30% for double axis
film technologies. trackers compared with fixed systems.
Organic thin-film PV (OPV) cells use dye or organic semiconductors

as the light-harvesting active layer. This technology has created
increasing interest and research over the last few years and is PV APPLICATIONS AND
currently the fastest-advancing solar technology. Despite the low MARKET SEGMENTS
production costs, stable products are not yet available for the
market, nevertheless development and demonstration activities
are underway. Tandem cells based on perovskites are researched
as well, with either a crystalline silicon base or a thin film base and When considering distributed PV systems, it is necessary to
could hit the market sooner than pure perovskites products. In 2021, distinguish BAPV (building applied photovoltaics) and BIPV
perovskite solar cell achieved 28,0% efficiencies in silicon‑based (buildings integrated photovoltaics) systems. BAPV refers to PV
tandem and 23,26% efficiencies in CIGS-based tandems. systems installed on an existing building while BIPV imposes to
replace conventional building materials by some which include PV
Photovoltaic modules are typically rated from 290 W to 600 W, cells. Amongst BIPV solutions, PV tiles, or PV shingles, are typically
depending on the technology and the size. Specialized products small, rectangular solar panels that can be installed alongside
for building integrated PV systems (BIPV) exist, sometimes with conventional tiles or slates using a traditional racking system used
higher nominal power due to their larger sizes. Crystalline silicon for this type of building product. BIPV products can take various
modules consist of individual PV cells connected and encapsulated shapes, colours and be manufactured using various materials,
between a transparent front, usually glass, and a backing although a vast majority use glass on both sides. They can be
material, usually plastic or glass. Thin-film modules encapsulate assembled in a way that they fill multiple functions usually devoted
PV cells formed into a single substrate, in a flexible or fixed to conventional building envelope solutions.
module, with transparent plastic or glass as the front material.
Their efficiency ranges between 9% (OPV), 10% (a-Si), 17% (CIGS Bifacial PV modules collect light on both sides of the panel.
and CIS), 19% (CdTe), 25% GaAs (non-concentrated) and above Depending on the reflection of the ground underneath the
40% for some CPV modules. modules (albedo), the energy production increase is estimated
to a maximum of 15% with a fixed structure, and possibly up to
A PV system consists of one or several PV modules, connected 30‑35% with a single-axis system. Bifacial modules have a growing
to either an electricity network (grid-connected PV) or to a series competitive advantage despite higher overall installation costs.
of loads (off-grid). It comprises various electric devices aimed at Indeed, recent competitive projects in desert areas boosted the
adapting the electricity output of the module(s) to the standards market confidence in bifacial PV performance and production lines
of the network or the load: inverters, charge controllers or batteries. are increasingly moving towards bifacial modules. The additional
factors affecting bifacial performance into their models are also
A wide range of mounting structures has been developed
better understood and integrated in the downstream industry.
especially for BIPV; including PV facades, sloped and flat roof
Bifacial PV panels have gained traction again in 2021 and are
mountings, integrated (opaque or semi-transparent) glass-glass
expected to take growing market shares in the coming years for
modules and PV tiles.
utility-scale applications.
6
Floating PV systems are mounted on a structure that floats on Tracker (MPPT), which continuously adjusts the load impedance to
a water surface and can be associated with existing grid connections provide the maximum power from the PV array. One inverter can
for instance in the case of dam vicinity. The development of floating be used for the whole array or separate inverters may be used
PV on man-made water areas is a solution to land scarcity in high for each string of modules. PV modules with integrated inverters,
population density areas and can be combined with hydropower. usually referred to as “AC modules”, can be directly connected to
the electricity network (where approved by network operators),
Agricultural PV combine crops and energy production on the same they offer better partial shading management and installation
site. The sharing of light between these two types of production flexibility. Similarly, micro-inverters, connected to up to four panels
potentially allows a higher crop yield, depending on the climate and also exist, despite their higher initial cost, they present some
the selection of the crop variety and can even be mutually beneficial advantages where array sizes are small and maximal performance
in some cases, as the water which evaporates from the crops can is to be achieved.
contribute to a reduction of PV modules operating temperature.
Grid-connected distributed PV systems are installed to provide
PV thermal hybrid solar installations (PVT) combine a solar module power to a grid-connected customer or directly to the electricity
with a solar thermal collector, thereby converting sunlight into network, more specifically the distribution network. Such systems
electricity and capturing the remaining waste heat from the PV may be on, or integrated into, the customer’s premises often on the
module to produce hot water or feed the central heating system. demand side of the electricity meter, on residential, commercial or
It also allows to reduce the operating temperature of the modules, industrial buildings, or simply in the built environment on motorway
which benefits the global performances of the system. sound-barriers, etc. Size is not a determining feature – while a
VIPV or vehicle integrated PV. The integration of solar cells into 1 MW PV system on a rooftop may be large by PV standards, this
the shell of the vehicles allow for emissions reductions in the is not the case for other forms of distributed generation.
mobility sector. The solar cell technological developments allow Grid-connected centralized PV systems perform the functions
to meet both aesthetic expectations for car design and technical of centralized power stations. The power supplied by such a
requirements such as lightweight and resistance to load. VAPV system is physically not associated with an electricity customer,
relates to the use of PV modules on vehicles without integration. and the system is not located to specifically perform functions
Various Solar Home Sytems (SHS) or pico PV systems have on the electricity network other than the supply of bulk power.
experienced significant development in the last few years, These systems are typically ground-mounted and functioning
combining the use of efficient lights (mostly LEDs) with charge independently of any nearby development.
controllers and batteries. With a small PV panel of only a few watts, Hybrid systems combine the advantages of PV and diesel
essential services can be provided, such as lighting, phone charging generator in mini grids. They allow mitigating fuel price increases,
and powering a radio or a small computer. Expandable versions of deliver operating cost reductions, and offer higher service quality
solar pico PV systems have entered the market and enable starting than traditional single-source generation systems. The combining
with a small kit and adding extra loads later. They are mainly used of technologies provides new possibilities to provide a reliable and
for off-grid basic electrification, mainly in developing countries. cost-effective power source in remote places such as for telecom
base stations. Large-scale hybrids can be used for large cities
powered today by diesel generators and have been seen, for
GRID-CONNECTED PV SYSTEMS
instance in central Africa, often in combination with battery storage.
In grid-connected PV systems, an inverter is used to convert
electricity from direct current (DC) as produced by the PV array
to alternating current (AC) that is then supplied to the electricity
network. The typical weighted conversion efficiency is in the range
of 95% to 99%. Most inverters incorporate a Maximum Power Point
7
PV APPLICATIONS AND METHODOLOGY FOR THE MAIN PV

MARKET SEGMENTS / CONTINUED MARKET DEVELOPMENT INDICATORS
OFF-GRID PV SYSTEMS This report counts all PV installations, both grid-connected and
reported off-grid installations. By convention, the numbers
For off-grid systems, a storage battery is required to provide
reported refer to the nominal power of PV systems installed.
energy during low-light periods. Nearly all batteries used for PV
These are expressed in W (or Wp). Some countries are reporting
systems are of the deep discharge lead-acid type. Other types of
the power output of the PV inverter (device converting DC power
batteries (e. g. NiCad, NiMH, Li-Ion) are also suitable and have the
from the PV system into AC electricity compatible with standard
advantage that they cannot be overcharged or deep-discharged.
electricity networks). The difference between the standard DC
The lifetime of a battery varies, depending on the operating regime
Power (in Wp) and the AC power can range from as little as 5%
and conditions, but is typically between 5 and 10 years even
(conversion losses) to as much as 40% (for instance some grid
if progresses are seen in that field.
regulations limit output to as little as 65% of the peak power from
A charge controller (or regulator) is used to maintain the battery the PV system, but also higher DC/AC ratios reflect the evolution
at the highest possible state of charge (SOC) and provide the of utility-scale PV systems). Conversion of AC data has been made
user with the required quantity of electricity while protecting when necessary, to calculate the most precise installation numbers
the battery from deep discharge or overcharging. Some charge every year. Global data should be considered as indications rather
controllers also have integrated MPP trackers to maximize the PV than exact statistics. Data from countries outside of the IEA PVPS
electricity generated. If there is a requirement for AC electricity, network have been obtained through different sources, some of
a “stand‑alone inverter” can supply conventional AC appliances. them based on trade statistics.
Off-grid domestic systems provide electricity to households and As an increasing share of the global installed PV capacity is attaining
villages that are not connected to the utility electricity network. a certain lifetime - the very first waves of installations dating back
They provide electricity for lighting, refrigeration and other low to the nineties - performance losses and decommissioning must be
power loads, have been installed worldwide and are increasingly considered to calculate the PV capacity and PV production.
the most competitive technology to meet the energy demands
For this report, the PV penetration was estimated with the most
of off-grid communities.
recent global data about the PV installed capacity, the average
Off-grid non-domestic installations were the first commercial theoretical PV production and the electricity demand based.
application for terrestrial PV systems. They provide power for a In general, PV penetration is amongst one of the best indicators
wide range of applications, such as telecommunications, water to reflect the market dynamics in a specific country or region.
pumping, vaccine refrigeration and navigational aids. These are If a global PV penetration level does not reflect the regional
applications where small amounts of electricity have a high value, disparities, it gives an indication about the ability of the technology
thus making PV commercially cost competitive with other small to keep up with the global demand growth. Hence, regarding
generating sources. climate goals for instance, the PV penetration is a better indicator
than the absolute market growth.
8
IEA PVPS TRENDS IN PHOTOVOLTAIC APPLICATIONS 2022 Photo by Denis Schroeder, NREL 55200
two
PV MARKET DEVELOPMENT TRENDS
Since the early beginnings of the PV market development, over THE GLOBAL PV
945,4 GW of PV plants have been installed globally, of which
around 70% has been installed in the past five years. Over the INSTALLED CAPACITY
years, a growing number of markets have started to contribute
to global PV installations, and the year 2021 closed with a record
number of new countries installing significant PV numbers.
A large majority of PV installations are grid-connected and include Global PV installed capacity (GW)
an inverter which converts the variable direct current (DC) output
of solar modules into alternating current (AC) to be injected
into the electrical grid. PV installation data is reported in DC by
+22% YoY growth
default in this report (see also Chapter 1). When countries are
reporting officially in AC, this report converts in DC to maintain
At the end of 2021, the global PV installed capacity represented
coherency. When official reporting is in AC, announced capacities
945,4 GW of cumulative PV installations.
are mentioned as MWac or MWdc in this report. By default,
MW implies capacities mentioned in DC. Presently it appears that 173,5 GW represented the minimum
capacity installed during 2021 with a reasonably firm level of
For more information on registering PV installations, download the
certainty. This level is the highest ever recorded for PV installations,
IEA PVPS report on registering PV installations published recently.
despite the pandemic related perturbations which have delayed
market development in several countries. The real impact of the
Download the pandemic is difficult to estimate, since the delays observed in the
“data Model for PV first part of the year were sometimes compensated in the second
System” reports: part. However, it seems reasonable that many projects might
have been delayed. In addition, prices increased and logistic issues
possibly reduced the installations in the last part of the year 2021.
Hence the market results could have probably been even higher,
reflecting the sector mood.
The group of IEA PVPS countries represented 753 GW of the global

installed capacity. The IEA PVPS participating countries in 2021
are Australia, Austria, Belgium, Canada, Chile, China, Denmark,
Finland, France, Germany, Israel, Italy, Japan, Korea, Malaysia,
9
THE GLOBAL PV INSTALLED CAPACITY / CONTINUED
Mexico, Morocco, the Netherlands, Norway, Portugal, South Ukraine with over 6 GW, Greece with 5 GW, the Czech Republic
Africa, Spain, Sweden, Switzerland, Thailand, Turkey, and the with 2,0 GW installed, Romania with 1,6 GW, and Bulgaria
United States of America. almost 1,3 GW. The other major countries that accounted for the
highest cumulative installations at the end of 2021 and that are
The other key markets that have been considered and which are not not part of the IEA PVPS programme are: Brazil with 13,7 GW,
part of the IEA PVPS Programme, represented a total cumulative and Taiwan with 7,7 GW. Numerous countries all over the world
capacity of 154,3 GW at the end of 2021. Amongst them, India have started to deploy PV, but few have yet reached a significant
covered around one third of that capacity with 61 GW. Vietnam development level in terms of cumulative installed capacity outside
reached 18,4 GW after three years of important PV development the ones mentioned above. New developments occurred in Africa
(in particular over 11 GW installed in 2020). The remaining (Egypt, South Africa) and in the Middle East (UAE) which led to
part of PV capacities is mainly located in Europe, and partly GW-scale installation levels: 4,6 GW in South Africa, 3,5 GW in the
related to historical installations as well as to the contribution UAE and 3,4 in Egypt for instance.
of emerging markets: UK with 14,6 GW, Poland with 7,7 GW,
FIGURE 2.1: EVOLUTION OF CUMULATIVE PV INSTALLATIONS
1000
945,4
900
800 771,8
700
626,4
600
513,5
GW 500
408,9
400 IEA PVPS countries
306,0
300 Other countries
228,2
200 178,7
138,6
100,8
100 71,0
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
PV PENETRATION PER CAPITA As a comparison, 500 W represents the power of a large PV

module, one can say that in some countries one module per person
In just a few years, Australia has reached the highest installed PV
have been installed.
capacity per inhabitant with 1 011 W/cap in IEA-PVPS and surveyed
countries. The Netherlands is second with 818 W/cap. Germany
comes next with 718 W/cap followed by Japan with 622 W/cap
and Belgium with 620 W/cap. Switzerland and Korea nearly Australia has reached the
tied at the 6th place with respectively 422 W/cap and 416 W/cap.
Denmark (399 W/cap) and Spain (396 W/cap) come next. Italy highest installed PV capacity per
and the USA are closing the top 10 (among IEA PVPS countries)
with 374 and 371 W/cap.
inhabitant with 1 011 W/cap.
10
FIGURE 2.2: PV PENETRATION PER CAPITA IN 2021
PV penetration
(Wp/capita)
1011
506
0 or NA
EVOLUTION OF PV ANNUAL INSTALLATIONS
FIGURE 2.3: EVOLUTION OF ANNUAL PV INSTALLATIONS
200
180 173,5
160
145,5
140 Other countries
120 112,9 Other IEA PVPS countries
102,9 104,6
GW 100 Japan
76,8 India
80
USA
60 50,5
European Union
37,8 40,1
40 31,5 29,8 China
20
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
11
The IEA PVPS countries installed at least 129 GW in 2021. Second was the European Union, which experienced growth
While they are more difficult to track with a high level of certainty, for the third year in a row with 28,7 GW, which exceeds the
installations in non-IEA PVPS countries contributed an estimated 23,2 GW recorded in 2011. Germany (5,8 GW) and Spain (4,9 GW)
amount of 44 GW. The noteworthy trend of 2021 is the important were the key markets this year followed by Poland (3,7 GW),
year on year growth for the second year in a row, of the global PV the Netherlands (3,6 GW) and France (3,4 GW) and several others.
market despite the supply chain turmoil which could have paused
or delayed market development in some countries. As in 2020, the Third was the United States with 26,9 GW installed, marking a
rise of emerging markets in addition to the growth of key markets significant growth again compared to the previous year making
contributed to this market growth in 2021. 2021 the largest single year increase in installations in the U.S.
Both the utility sector installations and the residential market
For the ninth year in a row, China was in the first place and increased over 2020 installation levels. At the end of 2021, the U.S.
installed almost 55 GW in 2021, according to China’s National reached 123 GW of cumulative installed capacity.
Energy Administration; an installation level that surpassed the
level reached in the country in 2017 (52,8 GW). The total installed India was in fourth place with 13,7 GW installed, bringing back the
capacity in China reached 308,5 GW, and by that the country kept annual market to levels close to those observed in 2017, 2018 and
its market leader position in terms of total installed capacity. The 2019. The official number has been recalculated based on official
Chinese market represented 31% of the global installation in 2021. AC data using IEA PVPS assumptions on AC-DC ratio.
The market in Japan contracted slightly with 6,6 GW in 2021,

its lowest level since 2012.
Annual PV installations (GW)
+19% YoY growth
FIGURE 2.4: EVOLUTION OF MARKET SHARE OF TOP COUNTRIES
100
90% 91%
88% 88%
86% 85% 85% 85%
83%
80 77% 78%
76%
78%
76%
71% 72%
69%
64%
62%
60 57% 58%
52%
% 48%
45%
42%
40
33% 32%
30%
28% 28% 27% 27%
20 19%
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
1 s t G lo b a l P V M a r k e t To p 5 G lo b a l P V M a r k e t s To p 1 0 G lo b a l P V M a r k e t s
12
Together, these five leading individual or block of countries Together, these 10 markets cover around 76% of the 2021 annual
represented around 75% of all installations recorded in 2021, world market, a sign that the growth of the global PV market has
the same level as in 2020. In terms of cumulative installed capacity, been driven by a limited number of countries again, and this even
these countries represent 76% of the global capacity. This shows if the remaining markets are starting to contribute more significantly.
that the global PV market concentration is again increasing, with Market concentration has been fuelling fears for the market’s stability
new markets contributing proportionally less to global installation in the past, if one of the top three or top five markets would experience
numbers than established ones. a slowdown. As shown in Figure 2.4, the market concentration steadily
decreased in 2019 before growing again in 2020 and stabilising in 2021,
Behind the top 5, Brazil installed 5,7 GW leading to a cumulative market mostly due to the growth of the Chinese PV market. As new markets are
of 13,7 GW in 2021. After years of limited PV market development, starting to emerge, the versatility of the global PV market minus China
Brazil appears now as one of the key global players, demonstrating reduces, and therefore the risks. However, the size of the Chinese PV
its much higher potential than the levels reached until now. market continues to shape the evolution of the PV market as a whole.
Australia installed 4,9 GW in 2021, a stable level since 2018 and As we have seen in 2019, the global growth was limited due to the
a tremendous level given the country’s population. For several years decline of the first market, which almost wiped out the global growth,
the country has been experiencing a boom in utility-scale applications while in 2021, China’s installations maximized the global growth.
together with a robust demand for distributed PV systems. The total The level of installations required to be included in the top 10
installed PV capacity reached 26 GW at the end of 2021. (country wise) has increased steadily since 2014: from 0,78 GW to
Korea installed 4,2 GW in 2021 with an important share of 1,6 GW in 2018, and around 3,5 GW in 2020 and 2021. This reflects
utility‑scale plants, a slight decrease compared to 2020 when the the global growth trend of the solar PV market, but also its variations
highest level of installations ever in the country was recorded. from one year to another.
Korea is one key industrial actor in the PV sector, with several key
players such as Hanwha and OCI.
Considering the European Union (a member of the IEA
Chile’s position in the top 10 countries for PV installations comes PVPS) as one entity rather than a collection of markets
from 2,7 GW installed in 2021, marking a tremendous boom in PV is an editorial choice of the writers. Considering the
market development in the country. European PV Markets separately, Germany would rank
fifth, Spain eighth and Poland tenth. This doesn’t change
In the tenth position comes Vietnam where PV installations the general conclusions of this chapter; the ten first
significantly decreased after the massive growth observed in 2020. countries would cover 76% of the global PV market.
In total around 2 GW were installed.
TABLE 2.1: EVOLUTION OF TOP 10 MARKETS
RANKING 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
1 ITALY GERMANY CHINA CHINA CHINA CHINA CHINA CHINA CHINA CHINA CHINA
2 GERMANY ITALY JAPAN JAPAN JAPAN USA INDIA INDIA USA USA USA
3 CHINA CHINA USA USA USA JAPAN USA USA INDIA VIETNAM INDIA
4 USA USA GERMANY UK UK INDIA JAPAN JAPAN JAPAN JAPAN JAPAN
5 FRANCE JAPAN ITALY GERMANY INDIA UK TURKEY AUSTRALIA VIETNAM GERMANY GERMANY
6 JAPAN FRANCE UK SOUTH AFRICA GERMANY GERMANY GERMANY TURKEY AUSTRALIA AUSTRALIA BRAZIL
7 BELGIUM AUSTRALIA ROMANIA FRANCE KOREA THAILAND KOREA GERMANY SPAIN KOREA AUSTRALIA
8 UK INDIA INDIA KOREA AUSTRALIA KOREA AUSTRALIA MEXICO GERMANY INDIA SPAIN
9 AUSTRALIA GREECE GREECE AUSTRALIA FRANCE AUSTRALIA BRAZIL KOREA UKRAINE SPAIN KOREA
10 GREECE BULGARIA AUSTRALIA INDIA CANADA TURKEY UK NETHERLANDS KOREA NETHERLANDS POLAND
RANKING 1 1 2 3 3 4 5 4 2 2 2
EU
MARKET LEVEL TO ACCESS THE TOP 10
426 MW 843 MW 792 MW 779 MW 675 MW 818 MW 944 MW 1 621 MW 3 130 MW 3 492 MW 3 710 MW
13
Other countries reached significant installation levels in 2021:

As detailed above, the IEA PVPS choice consists in Around 3,7 GW of PV installations were added in Poland in 2021,
reporting DC capacities. An estimate of AC capacities mostly as small distributed installations. 3,6 GW were installed in
would put the new installed capacities number around the Netherlands, 3,4 GW in France marking a significant growth
129 GW in 2021. This number (in the same way as compared to previous year and also 1,9 GW in Taiwan, 1,5 GW
the DC number) is an approximation of the reality in Turkey and 1,2 GW in Greece.
and represents an estimated value of the maximum
power that all PV systems globally could generate Other countries that installed significant amounts of PV but below
instantaneously, assuming they would all produce at the GW mark, were Israel (940 MW), Italy (944 MW), Belgium
the same time. This number is indicative and should (850 MW), Hungary (800 MW), Austria (740 MW), the UK
in no case be used for energy production calculation. (730 MW) and Denmark (720 MW). The market uptake in the
European Union makes it the second largest market globally.
Other countries that installed several GW in the last years or were The total installed capacity in most surveyed countries takes
found in the top 10 countries, didn’t succeed in maintaining a decommissioning of PV plants into account. While such numbers
sufficiently high level of installations to stay in the rankings: Mexico, remain relatively limited for the time being, they start to impact
Turkey, France and many other countries. The versatility of the numbers at a very low level, which can lead to discrepancies
markets is a feature of the PV industry that, from its inception, in national statistics of several IEA PVPS countries. Off-grid
had to deal with changes in policies and therefore in market numbers are difficult to track and most numbers are estimates.
development. This is levelizing progressively with PV reaching Changes (including repowering) and decommissioning are higher
competitiveness faster than many expected. for these applications than in other segments and can lead to
numerical glitches. In this report, global annual installations and the
After having reached GW-scale installations in 2019 and 2020, cumulative capacity are computed based on a variety of sources
PV deployment declined in Egypt in 2021, with 300 MW installed. and could, despites all efforts, differ from other publications.
In the UAE, almost 700 MW came online in 2021 through The development in many non-IEA countries is an estimate,
large-scale tenders, amongst the most competitive globally. due to the lack of official statistics in numerous countries.
Self‑consumption policies didn’t contribute much but could
represent a complementary driver in the near future. Mexico’s
annual installations maintained their 2020 level with 1,6 GW in
2021, in a complex policy environment, which might put the brakes
on its market in the coming years.
FIGURE 2.5: GLOBAL PV MARKET IN 2021 FIGURE 2.6: CUMULATIVE PV CAPACITY END 2021
POLAND, 2,14% VIETNAM, 1,95%

SPAIN, 1,96%
SOUTH KOREA, 2,44%
SOUTH KOREA, 2,28%
SPAIN, 2,82%
ITALY, 2,39%
AUSTRALIA, 2,85% OTHER COUNTRIES, 21,99%
OTHER COUNTRIES, 24,37% AUSTRALIA, 2,75%
BRAZIL, 3,29% GERMANY, 6,31%
GERMANY, 3,32%
JAPAN, 3,77% INDIA, 6,45%
INDIA, 7,87%
JAPAN, 8,29%
USA, 15,49% CHINA, 31,64%

USA, 13,01% CHINA, 32,62%
SOURCE IEA PVPS, RTS CORPORATION SOURCE IEA PVPS, RTS CORPORATION
14
FIGURE 2.7: EVOLUTION OF REGIONAL PV INSTALLATIONS
1000
900
800
700
600
GW 500
400
300
200
100
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
The Americas Rest of the World Middle East & Africa Europe Asia-Pacific
FIGURE 2.8: 2018-2021 GROWTH PER REGION
1000
900
800
700
600
Other countries
GW 500
Other IEA PVPS countries
400 Japan
300 India
200 USA
European Union
100
China
0
2018 2019 2020 2021
15
PV MARKET SEGMENTS
Solar PV experienced another growth year mainly driven by Due to the simplicity of setting up policies to develop them, with or
utility‑scale projects which continued to develop fast both in without tenders, utility-scale applications are thriving in new PV
established markets and in countries which only appeared recently markets. More countries are proposing tendering processes to
on the PV development map. Although the role of distributed select the most competitive projects. Merchant PV, where PV
generation should not be underestimated, utility-scale PV is likely electricity is directly sold to electricity markets or (C-)PPAs, where
to keep dominating electricity generation in many countries. it is directly sold to (corporate) consumers is experiencing growth in
The main reason is that economies of scale outweigh the savings in numerous countries, but this market driver remains limited so far.
transmission costs and the self-consumption possibilities brought
by embedded installations. One of the key trends of 2021 is the wider development
of utility‑scale plants without financial incentives (on wholesale
Ground mounted utility-scale PV installations increased in 2021 electricity markets or from private customers). Such development
with more than 95 GW, compared to 86 GW in 2020 and 71 GW in is mostly independent from financial incentives and therefore policy
2019. However, the share of utility-scale still represented around decisions, which makes its potential virtually unlimited. Limitations
55% of cumulative installed capacity because distributed PV also are already seen due to grid congestion in some places: this has
grew significantly, up to 78 GW in 2021 compared to 59 GW in modified the tendering approaches which might lead to bidding at
2020. Off-grid and edge-of-the-grid applications are increasingly the lowest possible cost to secure a grid connection. This has been
integrated in these two large categories. seen in Portugal for instance.
New utility-scale PV plants are increasingly using trackers to

UTILITY-SCALE PV: THE PV MARKET DRIVING FORCE maximise production and in parallel, the use of bifacial PV modules
increases relatively fast as well. The addition of storage systems also
Utility-scale PV plants are in general ground-mounted becomes a trend in some countries, either pushed by specific rules in
(or floating) installations. In some cases, they could be used for tenders or by the willingness to better serve the wholesale and grid
self-consumption when close to large consumption centres or services markets. In 2021, utility-scale plants amounted to 95 GW
industries, but generally they feed electricity directly into the grid. globally and the total installed capacity for all of these applications
amounted to 534 GW; or 56% of the cumulative installed capacity.
TABLE 2.2: TOP 10 COUNTRIES FOR CENTRALIZED PV TABLE 2.3: TOP 10 COUNTRIES FOR CUMULATIVE
INSTALLED IN 2021 CENTRALIZED PV INSTALLED CAPACITY IN 2021
COUNTRY GW COUNTRY GW
CHINA 25,60 CHINA 199,94
USA 20,26 USA 80,33
INDIA 11,62 INDIA 52,90
SOUTH KOREA 4,00 JAPAN 30,12
SPAIN 3,50 SOUTH KOREA 18,91
JAPAN 2,99 SPAIN 15,23
NETHERLANDS 2,35 GERMANY 11,10
FRANCE 2,22 AUSTRALIA 9,00
GERMANY 2,01 NETHERLANDS 8,49
AUSTRALIA 1,71 UK 8,35
SOURCE IEA PVPS SOURCE IEA PVPS
16
FIGURE 2.9: CENTRALIZED PV INSTALLED CAPACITY PER FIGURE 2.10: CENTRALIZED PV CUMULATIVE INSTALLED
REGION 2021 CAPACITY PER REGION 2021
60 350
50 300
250
40
200
GW 30 GW
150
20
100
10
50
0
0
Asia Pacific Europe Middle East The Americas
Asia Pacific Europe Middle East The Americas
and Africa
and Africa
SOURCE IEA PVPS & OTHERS SOURCE IEA PVPS & OTHERS
PROSUMERS, EMPOWERING CONSUMERS The distributed market has been oscillating around 16-19 GW
from 2011 to 2016, until China succeeded in developing its own
Prosumers are consumers producing part of their own
distributed market: it allowed the distributed PV market to grow
electricity consumption.
significantly to more than 36 GW globally in 2017 to 78 GW in 2021.
Historically driven by simple financial incentives such as
Several countries promote collective and distributed
net‑metering, prosumers segments increasingly develop thanks
self‑consumption as a new model for residential and commercial
to various schemes based on the concept of self-consumption.
electricity customers. This model allows different consumers
Indeed, the new generation of solar schemes is often making the
located in the same building or private area (collective self-
distinction between the electricity consumed and the electricity
consumption), or in the same geographical area which requires
injected into the grid, thereby incentivizing self-consumption.
to use the public grid (distributed or virtual or delocalized
An important factor in the success of self-consumption schemes is self‑consumption), to share the self-generated electricity,
the retail electricity price which is still being maintained artificially thereby unlocking access to self‑consumption for a wide range
low in some countries. Subsidies for fossil fuels are still a reality and of consumers. Such regulation, if well implemented, will allow
reduce the attractiveness of solar PV installations, also in market development of new business models for prosumers, creating jobs
segments involving self-consumption. Conversely, the PV market and local added value while reducing the price of electricity for
tends to grow quickly when electricity prices increase. Overall, consumers and energy communities. These models of production
there is a trend toward self-consumption of PV electricity in most of could also positively impact grid integration of PV systems by
countries, often with adequate regulations offering a value for the enhancing adequacy between production and demand. In the case
excess electricity. This can be done with a FiT, a feed‑in‑premium of “virtual (or distributed) self-consumption”, the prosumers are
added to the spot market price or more complex net-billing. not grouped behind a meter. We will call “virtual (or distributed
Unfortunately, the move towards pure self-consumption schemes or delocalized) self-consumption”, the case where production
can create temporary market slowdowns, especially if the transition and consumption can be compensated at a certain distance,
is abrupt. However, if the market conditions are favourable and while paying a fair share to cover the grid costs.
the market regains confidence, self-consumption can become
a market driver.
17
PV MARKET SEGMENTS / CONTINUED
TABLE 2.4: TOP 10 COUNTRIES FOR DISTRIBUTED PV TABLE 2.5: TOP 10 COUNTRIES FOR CUMULATIVE
INSTALLED IN 2021 DISTRIBUTED PV INSTALLED CAPACITY IN 2021
COUNTRY GW COUNTRY GW
CHINA 29,28 CHINA 108,22
USA 6,62 GERMANY 48,56
BRAZIL 4,16 JAPAN 48,11
GERMANY 3,75 USA 42,68
JAPAN 3,55 AUSTRALIA 16,68
AUSTRALIA 3,20 ITALY 14,55
POLAND 2,90 VIETNAM 10,46
INDIA 2,04 TURKEY 9,73
TAIWAN 1,59 BRAZIL 9,08
SPAIN 1,40 FRANCE 8,70
SOURCE IEA PVPS SOURCE IEA PVPS
FIGURE 2.11: DISTRIBUTED PV INSTALLED CAPACITY FIGURE 2.12: DISTRIBUTED PV CUMULATIVE INSTALLED
PER REGION 2021 CAPACITY PER REGION 2021
45 250
40
200
35
30
150
25
GW GW
20
100
15
10
50
0 0
Asia Pacific Europe Middle East The Americas Asia Pacific Europe Middle East The Americas
and Africa and Africa
18
EMERGING PV MARKET SEGMENTS
Globally, centralized PV continued to represent 56% of the tenders contributed to the utility-scale market, distributed PV
market in 2021, mainly driven by China, the USA, and emerging also increased significantly in 2021, with around 78 GW installed;
PV markets. In the same trend as in previous years, 2021 saw with 29,3 GW from China alone. Remarkably, the distributed
again some new records in terms of PV electricity prices through segment took off in the Middle East due to adequate policies in
extremely competitive tenders. Although renewed competitive Israel and Jordan.
FIGURE 2.13: ANNUAL SHARE OF CENTRALIZED AND DISTRIBUTED GRID-CONNECTED INSTALLATIONS 2011 – 2021
100
80
60
40
20
Grid-connected distributed
Grid-connected centralized
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
FIGURE 2.14: CUMULATIVE SHARE OF GRID CONNECTED PV INSTALLATIONS 2011 – 2021
100
80
60
40
20
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
19
EMERGING PV MARKET SEGMENTS / CONTINUED
With the exception of the European market which incentivized there is also a possible seasonal benefit in areas with dry and
residential segments from the start, initially most of the major wet seasons. Depending on the turbines and their reaction times,
PV developments in emerging PV markets are coming from it is also possible to cloud some of the short-term variability from
utility‑scale PV. This evolution had different causes. Utility-scale solar (due to could movements) and hence use the reservoirs as
PV requires developers and financing institutions to set up plants a “giant battery”. Many of the announced Floating Solar projects
in a relatively short time. This option allows the start of using PV are on hydropower reservoirs, for example in Thailand (3,5 GWp),
electricity in a country faster than what distributed PV requires. Korea (2,1 GWp) and Laos (1,2 GWp).
Moreover, tenders are making PV electricity even more attractive
in some regions. However, both trends are compatible as some Another area of increasing interest are near-shore and off-shore
policies were implemented recently in emerging markets to marine floating PV projects. Such projects will see additional
incentivize rooftop installations and tenders for rooftop installations challenges but also almost endless opportunities. The challenges
are being organized in several historical markets. are the much more demanding environments, where tidal
currents, richer marine life, wind, waves and the presence of salt
water all need to be considered. But the opportunities in near-
FLOATING PV: A GROWING MARKET SEGMENT shore areas alone are enormous: significant unused space can be
activated for energy harvesting close to load centers in coastal
The installed capacity of Floating PV (FPV) systems worldwide has settlements and harbours. Going further off-shore aggravates the
surpassed 3 GWp in 2021, according to data from the Solar Energy challenges and cost but still has possible applications, especially for
Research Institute of Singapore (SERIS) at the National University powering oil & gas platforms or for utilising the vast ocean spaces
of Singapore (NUS). SERIS maintains a global database of close between the towers in off-shore wind farms. In those cases, the
to 700 projects in operation and more than 300 projects under FPV project would take advantage of the existing transmission
planning, development, or construction. infrastructure and also of the fact that solar and wind generation
Apart from some installations in Europe, especially in the are often complementary in their resource availability. The first
Netherlands, France, and the UK, Floating Solar is so far mostly such testbeds are being set up in the Netherlands and Belgium.
located in Asia with more than 85% deployed in East and South‑East In terms of floating structures, the vast majority of the FPV
Asia. In densely populated areas the proximity of water bodies to installations in operation use HDPE plastic floats, for which Ciel
load centers is often an advantage. Traditional land-based solar & Terre and Sungrow together have more than 50% market share.
systems face either competing uses with industrial, or agricultural There is an increasing number of players, however, which follow
activities or may not be economically viable due to high cost of different designs, ranging from a combination of floats and metal
land. This is also why Japan was one of the early adopters of structures (e.g. Zimmermann) to membranes that are held in place
Floating PV and still has the highest number of FPV projects (~200). by large plastic rings (e.g. Ocean Sun). For off-shore applications,
Floating PV is even possible in city states such as Singapore, which more robust designs are being test-bedded, for example by
inaugurated a 60 MWp FPV plant in June 2021 and has called for Oceans of Energy or SolarDuck.
a study for another 140 MWp. The highest installed FPV capacity
to-date is deployed in China (a total of 1,3 GWp) where developers
largely took advantage of water bodies that were created when AGRI-PV: DUAL USE IS EXPECTED TO EMERGE FAST
former coal mines filled-up with ground water. These so-called
subsidence areas are almost ideal as they are considered as The development of PV on agricultural land had existed since
unstable territories (hence not suitable for industrial or agricultural the beginning of utility-scale PV but, in some cases, crops have
activities) and often have little bioactivities (leading to minimal been replaced by photovoltaics and thus the use land was mostly
environmental impacts). shifted from agriculture towards electricity production. Agri-PV
proposes a different perspective with the possibility to use land
Another great opportunity for Floating Solar is the combination for both purpose: food and energy production. With higher PV
with existing hydropower dams. This is even more so when penetration rates, competition for land can limit PV development in
conjointly operating the solar and hydro power generation a certain number of countries. Dual use of land is an option deeply
(rather than pure colocation of the FPV plant on the reservoir). investigated around the world to address this topic.
Apart from the diurnal cycle (i.e., generating solar power during
the day and saving water for hydropower generation at night),
20
PV potential on agricultural land and how it can contribute to • Crops, grassland, animal husbandry between PV systems.
achieving renewable energy targets have been highlighted in The systems must enable the land to maintain its agricultural
some regions, and interest but also reluctance increased. On one purpose. The space between the rows or the heights is adapted.
hand the agri-PV market potential is unsurpassed. An example of These systems are economically performant and cost effective.
the potential relative weight of this segment, in Japan a mapping Energetic production dominates but agricultural production
of all agricultural land suitable for PV concluded that just 10% could must be maintained.
hold 440 GW of PV, while 6,5 GW have been installed in 2021 for
all the segments reaching 78,2 GW cumulative installed capacity. System costs and profitability vary depending on the importance
South Korea’s perspective of agri-PV development is 10 GW in given to agricultural production compared to energy production.
2030, which is half of the cumulative installed capacity at the end of Support mechanisms and financial aid intensity can also vary
2021 (21,5 GW). In France, between 5 and 10 GW could be installed accordingly. PV systems falling under the most restrictive definition
using 0,1% of the agricultural land (agricultural land covers half of of agri-PV typically receive higher incentives or, in some countries,
the French territory) while annual installations achieved 3,4 GW are even the only type of PV plant allowed to be developed in
in 2021. The potential of 1% of the European Union’s agricultural agricultural areas.
lands had been calculated at 410 GW while 29,3 GW were installed For now, agriPV is still an emerging market. Japan has seen more
in the European Union installed in 2021. than 1 800 agriPV farms realised, most of them are small systems.
Even if PV potential is huge, other strong considerations must be Between 2013 and 2018, approximately 150 MW were installed,
taken into account. Food production security and sufficiency are and between 500 to 600 MW in 2021. China has also an important
the first priority. The various crises in 2020 and 2021 highlighted capacity installed but this segment doesn’t appear to be monitored
how crucial these aspects are. The agricultural sector’s economic separately. Italy announced a major funding package support
balance, environmental evaluation, social acceptance and water for 2 GW, including the so-called agriPV on roofs of rural areas.
management must be assessed and shape future regulations to Specific calls for tender have been set for agri-PV in numerous
ensure sustainable development. Following pioneer countries such countries: in France for around 300 MW, in Germany for 150 MW,
as Japan, where “solar sharing” has been defined since 2003, in Israel for 100 MW, and in the Netherlands for 45 MW.
and refers to PV installation above 2 m where 80% of agricultural
yields are maintained, France, Germany and Italy have published
BIPV: WAITING FOR THE UPTAKE
frameworks or guidelines in 2022.
The BIPV market remains a niche which is difficult to estimate.
Cross-sectorial groups have been working on frameworks. Defining With multiple business models, different incentives, many kinds
“agrivoltaic”, or “agrovoltaic”, “agri-PV” is challenging but a trend is of buildings and infrastructures (including roads), from tiles and
clear: not every PV installation set up in an agricultural environment shingles for residential roofs to glass curtain walls and more exotic
is considered an agrivoltaic installation, and most existing plants on façade elements in case of commercial buildings, BIPV covers
agricultural land could hardly qualify as such. Along the publications different segments with a large variety of products. Depending on
of the different frameworks and support mechanisms, in most the definition considered, the BIPV market ranged from 200 MW
countries agriPV or PV in agricultural land is segmented: to 400 MW per year in Europe last year and probably reached
• PV systems above the crops or plants. The system allows raising 1 GW globally. Indeed, the differences between custom-made
different kinds of crops with reduced solar insolation, allowing elements and traditional glass-glass modules can be difficult to
better development in sunny regions, and possibly new business assess. In that respect, simplified BIPV, using conventional PV
models - such as recovery of damaged crops for instance - modules with dedicated mounting structures, experienced positive
or growing different crops that would not have been profitable in developments in numerous EU countries in 2021, and is leading
some regions. This dual use imposes a different kind of PV systems, the BIPV market. The market is also split between some industrial
which can in some cases change their position, from horizontal products such as prefabricated tiles (found in the USA and multiple
to vertical and be designed either to maximize PV production or European countries for instance), to custom-made architectural
maximize crop production depending on the weather conditions. products fabricated on demand.
Tracking systems are not the only component that can help
maintain or enhance agricultural production which is a prerequisite
to be labelled as agri-PV. Agricultural production profitability
must dominate, and energy production is an added value.
21
OFF-GRID MARKET DEVELOPMENT PV DEVELOPMENT PER REGION
Numbers for off-grid applications are generally not tracked The early PV developments started with the introduction of
with the same level of accuracy as grid-connected applications. incentives in Europe, particularly in Germany, and caused a major
The off‑grid and edge-of-the-grid market can hardly be compared market uptake in Europe that peaked in 2008. While the global
to the grid‑connected market because the rapid deployment of market size grew from around 200 MW in 2000 to around 1 GW
grid-connected PV dwarfed the off-grid market. Nevertheless, in 2004, the market started to grow very fast, thanks to European
off-grid applications are developing more rapidly than in the past, markets in 2004. In 2008, Spain fuelled market development while
mainly thanks to rural electrification programs essentially in Asia Europe as a whole accounted for more than 80% of the global
and Africa but also in Latin America. market: a performance repeated until 2010. From around 1 GW in
2004, the market doubled in 2007 and reached 8 GW and 17 GW
In some countries in Asia and in Africa, off-grid systems with in 2009 and 2010.
back-up represent an alternative to bringing the grid into remote
areas or as an anticipation of grid connection. Two types of off-grid From 2011 onward, the share of Asia and the Americas started
systems can be distinguished: to grow rapidly, with Asia taking the lead. This evolution is quite
• Mini-grids, also termed as isolated grids, involve small‑scale visible and still true today, with the share of the Asia-Pacific region
electricity generation with a capacity between 10 kW and stabilizing around 54% in 2021. Since then, Asia continues to lead
10 MW. This grid uses one or more renewable energy sources PV development, with the other regions following.
(solar, hydro, wind, biomass) to generate electricity and serves
a limited number of consumers in isolation from national
electricity transmission network. Back-up power can be Detailed information about most IEA PVPS countries
batteries and/or diesel generators. can be found in the yearly National Survey Reports and
the Annual Report of the programme. IEA PVPS Task 1
• Stand-alone systems, for instance solar home systems (SHS)
representatives can be contacted for more information
that are not connected to a central power distribution system
about their own individual countries.
and supply power for individual appliances, households or small
(production) business. Batteries are also used to extend the
duration of energy use.
FIGURE 2.15: ANNUAL GRID-CONNECTED CENTRALIZED
This trend is specific to countries that have enough solar resources AND DISTRIBUTED PV INSTALLATIONS BY REGION IN 2021
throughout the year to make a PV system viable. In such countries,
PV has been deployed to power off-grid cities and villages or for 100
agricultural purposes such as water pumping installations. 90
PV increasingly represents a competitive alternative to providing 80
electricity in areas where traditional grids have not yet been 70

deployed. In the100same way as mobile phones are connecting
60
people without the traditional lines, PV is expected to leapfrog
90 50
complex and costly grid infrastructure, especially to reach the %
“last miles”. The80 challenge of providing electricity for lighting 40

and communication,70 including access to the internet, will see
30
the progress of PV as one of the most reliable and promising
60 20
sources of electricity in developing countries in the coming years. Grid-c
Specific business
% 50 models are developed in Africa for instance and 10
Grid-c
large energy groups
40 such as Engie Energy access for instance are 0
targeting millions of people with such products. Asia Pacific The Americas Europe Middle East and Africa
30
In most developed 20 countries in Europe, Asia or the Americas,

this trend remains unseen, and the future development of off-grid
10
applications will most probably only be seen on remote islands. Grid-connected centralized
0
Asia Pacific The Americas Europe Middle East and Africa
22
THE AMERICAS of cumulative PV installed capacity with most of the newly installed
capacity coming from distributed generation. PV installations in Chile
The Americas represented 40 GW of installations and a total
grew in 2021 reaching a cumulative installed capacity of 6,2 GW.
cumulative capacity of 164 GW in 2021. Whilst most of these
capacities are installed in the USA, several countries have started In other countries, such as Argentina, development is starting
to install PV in the central and southern countries of the continent: to take off, with around 960 MW cumulative installed capacity
first in Chile and Honduras and more recently in Mexico and Brazil. in the country at the end of 2021 and 200 MW installed in 2021.
Other multi-MW installations have been reported in Peru in recent
PV is developing in the Americas mostly through tenders except
years, in Honduras or in Colombia.
in the USA. Distributed applications start to develop in several
countries. Next to the USA market that dominates by far, instability Several other countries in Central and Latin America have put
has characterized the development of PV in most American support schemes in place for PV electricity, and an increasing
countries in the last years, with stop-and-go policies in Canada, number of power plants are connected to the grid mainly in
Honduras or Mexico for instance. The market was dynamic in Dominican Republic, Ecuador and El Salvador, closely followed by
2021 in Chile and Brazil, to mention these two, with prospects Uruguay and Panama which could indicate that the time has come
for development in several central American countries, such as for PV in the Americas. In countries with a high hydroelectricity
Costa Rica, Guatemala and more. contribution to the electricity mix, such as Venezuela, PV could
become an alternative to the variable production due to changes
Outside of the IEA PVPS membership, Brazil remains the
in rain patterns.
most important market: it finished the year 2021 with 13,7 GW
FIGURE 2.16: EVOLUTION OF PV INSTALLATIONS IN THE AMERICAS PER SEGMENT
100
80
60
40
Off-grid
20 Grid-connected distributed
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
23
ASIA-PACIFIC In 2021, Taiwan (Chinese Taipei) installed about 1,9 GW a steady

growth compared to previous years. It now reaches around 7,7 GW
The Asia-Pacific region installed close to 93 GW in 2021 and the
of cumulative capacity. The market is supported by a FiT scheme
total installed capacity reached more than 540 GW. The market was
guaranteed for 20 years. Larger systems and ground‑mounted
dynamic in all parts of Asia, (in India as well this year compared
systems must be approved in a competitive bidding process.
to 2020), and significant growth was recorded. In 2021 the region
The FiT level is higher for floating PV and the projects employing
represented 57% of the global PV installations.
high-efficiency PV modules.
As the most populated continent, Asia was poised to become the
In addition to these three countries where installations reached
largest PV market globally and this happened relatively fast. Apart
GW-scale levels, the market is dynamic in several other Asian
from the dynamism of China and Japan for several years now,
countries, with the market being driven by utility-scale applications
Asia is home to several IEA-PVPS additional GW-scale markets:
under tenders for instance in Indonesia, the Philippines, Nepal
Australia, Korea, and also Thailand. The size of the Chinese PV
or Kazakhstan.
market makes it a dominant player in the Asian and global PV
markets, while all other markets are lagging. The Government of Bangladesh has been emphasizing the
development of solar home systems (SHS) and solar mini-grids
Outside of the IEA-PVPS network, the largest market in terms
since about half of the population has no access to electricity.
of installations and potential is India. Given the population of
Thanks to the decrease in prices of the systems and a well‑conceived
the country, its potential would be at least at the level of China,
micro‑credit scheme, off-grid PV deployment exploded in recent
or more, given the need for electrification. The Indian market
years. The country targets 3,2 GW of renewables by 2021, out of
developed in the last years but plateaued around the 10 GW mark
which 1,7 GW of PV.
on an annual basis, before going down to 4,4 GW in 2020 due to a
series of administrative issues and difficulties. Some policy changes The market is growing in several other countries, at a different
such as tariff ceilings and safeguard duties in combination with a speed, such as in Pakistan, where the government has published
falling currency also impacted the tendering procedures. In 2018 a target of 5 GW of solar power by 2022, therefore, more projects
and 2019, several tender procedures found very few bidders and are expected to come online in the coming years.
even not enough takers in some cases. The support of the federal
government in India for PV is obvious, especially now that the Last but not least, in Singapore, the total PV installed capacity was
government raised its renewables ambition to 225 GW towards 630 MW at the end of 2021.
2022 (and 100 GW for PV), but the road to a fast development
Asia is a continent so diverse, that it can be difficult to derive
implies additional policy changes. In 2021, the PV market in India
trends from PV market development: however, the dynamics are
was reinvigorated with 13,7 GW installed leading to a cumulative
positive and while the challenges, as seen in India, are numerous,
capacity of 61 GW. The International Solar Alliance (ISA) initiated by
a massive PV market suitable for energy transition goals is coming.
India and France and supported by more than 120 countries aims
In that respect, Asia will continue to dominate the PV charts and
to install 1 000 GW in its member (emerging) countries by 2030.
pave the way for larger adoption of PV globally.
In Vietnam, after a solar market take off in 2019 with over 5,2 GW
installed (and a total installed capacity of 5,3 GW) and a boom in
2020 with at least 11,1 GW installed (mostly rooftop applications
but also of utility-scale plants (including floating PV applications)),
the marker shrunk to 2 GW in 2021 pushing the total installed
capacity to 18,4 GW. The government target for 2030, 12 GW,
is already reached, much faster than expected, while the country’s
electricity demand is expected to soar in the coming years.
24
FIGURE 2.17: EVOLUTION OF PV INSTALLATIONS IN ASIA PACIFIC PER SEGMENT
100
80
60
40
Off-grid
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
EUROPE Most European countries used Feed-in Tariffs schemes to start

developing PV and moved in the last years to self-consumption
In the first years of this century, Europe led PV development for
(or variants) for distributed PV while tenders became the standard
years and represented more than 70% of the global cumulative PV
for utility-scale PV. These trends are not typical to Europe,
market until 2012. From 2013 to 2017, European PV installations
but self‑consumption developed faster here than in other locations.
decreased while there has been rapid growth in the rest of the
Collective and delocalized self-consumption are developing in
world, mainly in Asia and the Americas. The fast development
several countries. BIPV has been incentivized more than in any
of PV led to a strong opposition from many stakeholders from
other location in the past but remains a niche market after several
the energy sector, and the market declined rapidly in several
GW of installations. Simplified BIPV seems to develop well in
countries. In addition, several countries implemented measures
some countries. Merchant utility-scale PV developed in Spain
aiming at decreasing the cost of PV installations for the community
and Germany and could lead to a significant market share in a
by retroactively changing the remuneration levels or by adding
near future. Portugal saw competitive tenders below a reasonable
taxes. This phenomenon happened mostly in Europe, where the
price in 2020, sign of speculation on grid connections. In general,
fast development of PV took place before other regions of the
PV development in Europe has experienced a significant
world: Spain, Italy, Czech Republic, Belgium, France and others
acceleration, and rising electricity prices in 2022 are increasing the
took some measures with a consequent impact on the confidence
competitiveness of PV electricity.
of developers and prosumers.
But since then, the situation improved gradually in most countries

and PV installations rose in Europe. This was the case again
in 2021. Europe saw its PV market growing again in 2021,
with 30,9 GW installed, which accounted for 18% of the global PV
market. European countries had close to 198 GW of cumulative PV
capacity by the end of 2021, the second largest capacity globally.
It is important to distinguish the European Union and its countries,
which benefit from a common regulatory framework for part of
the energy market, and other European countries which have their
own energy regulations and are not part of the European Union.
25
FIGURE 2.18: EVOLUTION OF PV INSTALLATIONS IN EUROPE PER SEGMENT
100
80
60
40
Off-grid
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
European Union The recovery and resilience plans do not themselves set new
targets for the deployment of renewables at a national level.
Policy Framework
Rather they define a package of strategic projects, ranging from
The European Union has a strong influence on climate and energy technological to socio-economic and administrative. Most national
policies and has historically supported high renewable energy recovery and resilience plans include measures to support the
developments to tackle climate change. In recent years, the EU installation of solar PV systems and targets for green hydrogen
has set increasingly ambitious goals, which have been augmented from renewable energy sources. This comprises the electrification
several times: In December 2018, the revised European Renewable of transport mentioned in various plans that will require additional
Energy Directive (RED II) set a 32% renewable energy target by renewable electricity capacities. Rooftop installations are
2030, up to 20% in comparison with 2020. Since then, the target mentioned by several countries, often with regard to building
has been increased: the share of renewables in the EU’s final renovation. However, total numbers are often difficult to derive as
energy consumption has been set to 45% by 2030. PV and wind are often bundled.
In 2019 the European Green Deal was introduced, an action plan to In 2022, the REPowerEU has been proposed as a joint European
boost the efficient use of resources by moving to a clean, circular action for more affordable, secure, and sustainable energy: it has
economy and to restore biodiversity and reduce pollution. One of been deemed as necessary both to accelerate the energy transition
the pillars of the European Green Deal is a commitment to be and to secure the EU’s energy supply and disconnect Europe
climate neutral by 2050. The European Commission raised the from Russian gas and oil imports. REPowerEU includes short
2030 climate targets to 55% GHG reduction by 2030. and medium-term milestones which aim at a full independence
from all Russian energy imports by 2027. The plan would bring
In May 2021, the European Council received a formal notification
the total renewable energy generation capacities to 1 236 GW
about the approval of the Recovery and Resilience Facility (RRF)
by 2030, in comparison to the original “Fit for 55” 1 067 GW
by all Member States. Together with the next long-term budget,
planned by 2030. Also, as part of the REPowerEU plan, the EU
this represents EUR 2,02 trillion of spending between 2020 and
Solar Energy Strategy’s aim is to boost the roll-out of photovoltaic
2027 which can be partially used to develop renewables including
energy. This strategy aims to bring online over 320 GW of solar PV
local manufacturing: Each recovery and resilience plan has to
capacity by 2025, and almost 600 GW by 2030. This plan will be
include a minimum of 37% of expenditure earmarked for actions
to fight climate change.
26
paving the way for an era of renewable energy at affordable prices metering of PV systems with a capacity between 3 and 10 kW.
while accelerating their development. It aims at achieving energy Also, in May 2019, the Turkish Government amended the rules
savings, produce clean energy and diversify the EU’s energy for “non licenced plants” increasing the project size up to 5 MW.
supply sources. However, only public installations used for agricultural irrigation,
water treatment plants or waste treatment facilities are eligible as
The Cypriot Recovery Plan includes investments into an “Euro Asia ground mounted projects.
Interconnector” in the territory of Cyprus. The Euro Asia
Interconnector is a cross border interconnector between Crete, State of Play
Cypriot, and Israeli power grids. The realisation of this 1 208 km long
At the end of 2021, the total installed PV power capacity in the
interconnection would allow more PV electricity capacity without
European Union had surpassed 170 GW.
additional storage. In March 2021, Cyprus, Greece and Israel
signed a memorandum of understanding for the interconnector Almost 55% of this were residential and commercial rooftop
with a power capacity between 1 000 to 2 000 MWac. It is expected installations. The PV market in the European Union was declining
that the connection will be completed by 2024, with operations for six years before the trend reversed in 2018. This trend
starting in 2025. continued in 2021 when the European Union added upward of
The implications for new PV capacity in the three partnering 28,7 GW of new PV power capacity. Spain (4,9 GW), Germany
countries are significant. Different to its partners Cyprus has (5,8 GW), Poland (3,7 GW), the Netherlands (3,6 GW) and France
(3,4 GW)can be mentioned as leading countries. Greece added
not yet revealed the planned additional renewable electricity
capacity. Israel announced that the interconnection would allow an over 1 GW while eight countries added more than 500 MW,
additional installation of 12 to 15 GW PV capacity by 2030. Greece namely Hungary, Austria, Denmark, Belgium, Italy, Portugal,
decided to phase out coal by 2028 and add an additional 5 GW of Switzerland and Sweden.
PV capacity by 2030. To do so, a strong interconnection as well as Over the last few years, the number of European Member States
the announced energy storage framework are crucial. conducting auctions for solar energy has continuously increased
In March 2021, Hungary announced to close its last coal fired and driven down prices to the current average level of EUR 35/
power plant 5 years earlier in 2025. This could lead to an increase MWh and EUR 70/MWh across the European Union. In 2020, the
of PV deployment, meaning that the 2030 target of 6,5 GW can be second Portuguese auction attracted the lowest bids. The winning
reached earlier. To what extend the 2040 target of 12 GW of PV projects offered electricity between EUR 11,2/MWh.
systems will be brought forward is not yet clear.
Other European Countries
The Polish recovery plan mentions rooftop PV but includes no Outside of the IEA-PVPS network, UK installed 730 MW in 2021,
concrete target. However, together with the Polish hydrogen still far from the GW-scale market it used to be a few years ago.
strategy, which aims for 2 GW of electrolysers and the aim to replace The country had more than 14 GW of PV at the end of the year
coal heating system in residential buildings with heat pumps, will 2021, with a market mostly focused on small-scale applications.
drive the demand for renewable electricity. The Polish Institute of PPA-driven utility-scale PV could develop in the coming years.
Renewable Energy, responsible for tracking the capacity additions
in the country, forecasts that the cumulative installed capacity will In the Russian Federation the “Energy Strategy of Russia for the
exceed the NECP target in 2022 and could reach 15 GW by 2025 Period Up to 2035” set a target share of renewable energy in total
and over 20 GW by 2030. electricity production at 4.5% by 2024. Furthermore, the Russian
government set a target of 25 GW for the installation of renewable
In Turkey, systems below 1 MW fall under the category of electricity capacities towards 2030. In 2021 about 200 MW of new
“non licenced plants” which allowed the market to take off. At PV capacity was installed in Russia, increasing the total capacity
the end of 2020, the cumulative capacity had exceeded 9,5 GW, to slightly above 2 GW.
most of it in the category of “non-licenced” according to the
Turkish transmission operator. In May 2019, the Turkish Energy
Market Regulatory Authority (EPDK) published new rules for net
27
MIDDLE EAST AND AFRICA development of PV in the last years and some of them a significant
increase. There is a clear trend in most countries to include PV
Over the past decade, many countries, especially in the Middle
in energy planning, to set national targets and to prepare the
East have started to connect large-scale PV power plants and more
regulatory framework to accommodate PV.
are in the pipeline. Several countries are defining PV development
plans and the prospects on the short to medium term are positive. Next to IEA-PVPS countries with a dynamic market such as Israel
The Middle East is amongst one of the most competitive places for and more recently Morocco, the region’s PV development is
PV installations, with PPAs granted through tendering processes extremely diverse with Egypt, Saudi Arabia and the UEA leading
among the lowest in the world. In 2021, around 6 GW have been installations. In the middle East, the market has been driven mostly
installed in the region, representing 3,5% of the global market. for competitive tenders for years and distributed applications
started to develop only recently (net metering policies have been
In MEA (Middle East and Africa) countries, the development of
implemented in Israel, Jordan, Saudi Arabia and Tunisia).
PV remains modest compared to the larger markets, especially in
the African countries. However, almost all countries saw a small
FIGURE 2.19: EVOLUTION OF PV INSTALLATIONS IN AFRICA AND THE MIDDLE EAST PER SEGMENT
100
80
60
40
Off-grid
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Often, energy prices are supported by government spending, The situation is similar in northern Africa, with tenders driving PV
which limited for years the ability of PV to compete. This market development in Egypt (even if the development was slower
situation is changing slowly, with new distributed schemes being than expected), Algeria, and Morocco. In several countries, the
proposed such as in Dubai (UAE). Tenders are still competitive question of local manufacturing is essential even if not yet visible
and Saudi Arabia became early 2021 the country with the most in current policies. The willingness to manufacture locally and
competitive tender: the lowest acceptable bid reached 10,4 USD develop a manufacturing industry is present and will influence
per MWh, the lowest on record. PV deployment in the coming years, especially in Morocco and
South Africa.
Another trend in the fast-developing region is the willingness for
government to develop brand new cities or neighbourhoods, which
aim at becoming showcases of renewable energies. This was the
case for Masdar City (UAE) or Spark and Neom (Saudi Arabia).
28
In the Middle East, countries such as Saudi Arabia, Bahrain, In Africa, besides the above-mentioned countries, Algeria has
Jordan, Oman and the United Arab Emirates have defined targets installed several hundreds of MW. Reunion Island, Senegal,
for renewable and solar energy for the coming years. Tenders are Kenya, Mauritania, Namibia and Ghana have already installed
an integral part of the plans for PV development in the short or long some capacity. As the costs are decreasing, the interest in PV
term in the region, while several were organized again in 2019 and is growing in other African countries. However, the market has
2020 and more have been announced. Almost 3 GWdc have been not really taken off despite the huge potential and the growing
installed in the UAE through several plants and more is expected competitiveness of solar PV, especially in off-grid applications.
to come. The main barrier is the financial aspect as the higher upfront
investment costs remains a barrier despite lower LCOE.
Jordan is aiming for 1 GW of PV in 2030 and already launched
several tenders and installed several hundreds of MW. Qatar The most competitive segment for the development of solar
published the results of its third tender for 800 MW in January in Africa, especially in remote areas, is PV plants to replace or
2020. Saudi Arabia launched a series of tenders in the past and complement existing diesel generators. Such kinds of hybrid plants
has again in 2020, with an initial objective totalling 3,3 GW. Bahrain have been developed in Democratic Republic of Congo, Rwanda,
has announced the development of 225 MW; Oman has launched Ghana, Mali, Ivory Coast, Burkina Faso, Cameroon, Gambia,
several tenders, each for at least 500 MW and plans to reach 4 GW Mauritania, Benin, Sierra Leone, Lesotho and others.
of RES capacity by 2030, Tunisia launched a tender for 500 MW
and for 70 MW, Libya 100 MW. Lebanon plans 180 MW towards Pay-as-you-go models are used to leverage financing difficulties
2020 and is investigating a plant of 500 MW as well. for residential consumers, different pricing formats exist to foster
access to clean and reliable electricity.
In Sub-Saharan Africa, with the notable exception of South Africa,
the market has been slower to develop. Development Aid is often Several large-scale PV plants have been announced or are under
a key tool for financing hybrid PV systems and electrify directly construction in several countries in Africa: Burkina Faso (20 MW
through new grid connection. Egypt is the new African market and 30 MW), Namibia (45 MW and 30 MW), Nigeria (100 MW),
leader with close to 300 MW installed in one year. The policies Cameroon (30 MW and 25 MW projects ongoing) and Kenya
engaged for several years now have started to produce positive (several projects ranging from 30 MW to 80 MW) to name just
effects and the market is poised to develop further. a few. The question of African power markets is essential since
many countries have a small, centralized power demand,
South Africa was the first major African PV market, under several sometimes below 500 MW. In this respect, the question is not only
tenders that led to 4,6 GW cumulatively installed at the end of 2021. to connect PV to the grid but also to reinforce the electricity grid
While a large part of the market was driven by tenders, the market infrastructure and interconnection with neighbouring countries.
should rebalance towards rooftop applications in the coming years However, concerning remote areas, micro-grids and off-grid PV
under government support. applications, such as water pumping installations, are expected to
play a growing role in bringing affordable power to the consumers,
in a continent with 700 million people still lack a basic access
to electricity.
29
TABLE 2.6: 2021 PV MARKET STATISTICS IN DETAIL
COUNTRY 2021 ANNUAL CAPACITY (MW) 2021 CUMULATIVE CAPACITY (MW)
DECENTRALIZED CENTRALIZED TOTAL DECENTRALIZED CENTRALIZED TOTAL
AUSTRALIA 3 231 1 713 4 944 17 037 8 998 26 035
AUSTRIA 658 81 739 2 679 104 2 783
CANADA 118 304 421 1 533 2 602 4 135
CHILE 1 250 1 431 2 681 1 323 4 842 6 165
CHINA 29 280 25 600 54 880 108 580 199 940 308 520
DENMARK 271 447 718 1 514 830 2 344
FINLAND 95 5 100 408 5 413
FRANCE 1 133 2 219 3 350 8 734 7 716 16 450
GERMANY 3 753 2 008 5 760 48 559 11 103 59 661
ISRAEL 668 267 935 1 939 1 410 3 349
ITALY 890 54 944 14 546 8 048 22 594
JAPAN 3 553 2 992 6 545 48 292 30 121 78 413
KOREA 228 3 997 4 225 2 640 189 08 21 548
MALAYSIA 301 69 370 728 1 603 2 330
MEXICO 825 801 1 625 2 040 6 159 8 199
MOROCCO - - 493 - - 699
NETHERLANDS 1 287 2 345 3 632 5 861 8 488 14 349
NORWAY 45 0 45 205 0 205
PORTUGAL 102 469 571 569 1 079 1 647
SOUTH AFRICA 58 400 458 1 058 3 572 4 630
SPAIN 1 400 3 500 4 900 3 277 15 226 18 503
SWEDEN 576 23 599 1 690 108 1 798
SWITZERLAND 615 68 683 3 431 226 3 656
THAILAND 250 250 500 900 3 178 4 078
TURKEY 845 647 1 492 9 735 1 182 10 917
UNITED STATES 6 618 20 255 26 873 42 677 80 327 123 004
IEA PVPS 58 797 69 978 129 267 335 552 417 642 753 891
NON-IEA PVPS 19 319 25 373 44 200 75 802 116 697 191 801
TOTAL 78 116 95 351 173 467 411 354 534 339 945 692
30
IEA PVPS TRENDS IN PHOTOVOLTAIC APPLICATIONS 2022 Photo by Denis Schroeder, NREL 60075
three
POLICY FRAMEWORK
In the early phase of PV development, most markets have been investment barriers in specific countries. Support schemes
powered by a broad spectrum of support policies, from feed‑in are evolving according to market maturity, PV electricity
tariffs and direct subsidies to competitive calls for tender and competitiveness and investor confidence. Predefined feed-in-tariffs
premiums. The first aim was to reduce the gap between PV’s that support centralized PV are being replaced in many countries
cost of electricity and the price of conventional electricity by auctions with calls for tenders to propose the most competitive
sources thanks to financial support. The rapid price decline that PV electricity. This mechanism can be adapted, setting the same
PV experienced in the last years has enabled PV systems to auctions but for a variable premium, given on top of the wholesale
reach competitive prices in several segments and countries (for market price where the electricity is sold. When no more incentive
more detail, see Chapter 6, competitiveness of PV electricity). is needed, PV plants selling electricity through PPAs can be setup
The possibility to develop PV systems in many locations with followed by plants that sell electricity directly to the market.
limited or no financial incentives is now an observable reality.
Direct long-term private contracts between PV plant owners Support for the distributed PV market often begins by setting
and off-takers for the electricity produced (PPAs), and the sale feed‑in tariffs too, which still support half of these segments in 2021
of electricity on wholesale markets (merchant PV), have seen (54%), even if the trend leans towards lower tariffs. In places where
in an increasing number of countries in 2021 (a large part of self‑consumption is incentivized, supported initially by net-metering
ground-mounted PV plants installed capacity in Spain in 2021 mechanisms turning to net-billing mechanisms, premiums or FiT
was developed through PPAs). The growing competitiveness of tariffs for the excess electricity fed into the grid before competitive
PV electricity has also boosted the share of non-incentivized self-consumption without any incentives can take place.
self-consumption PV installations, which have reached 6% Since the question of the competitiveness of PV is less pressing,
in 2021. Moreover, the increase in energy costs in 2021 and a large part of new policies is also focussed on self-consumption
2022, and specifically electricity prices, have enhanced PV schemes, citizen communities and innovating forms of
competitiveness in numerous countries. If high market prices for collective and delocalised self-consumption. Policies supporting
electricity remain, the question of competitiveness will change self‑consumption might be considered as non-financial incentives
completely as will the way to conceive PV market support and since they set up the regulatory environment to allow consumers
policy framework. Without any support scheme limitation, to become prosumers or an energy community. Even if electricity
the PV market potential looks virtually unlimited. procurement can be compensated by PV production, taxes and the
However, the competitiveness of PV is not yet guaranteed in all financing of distribution and transmission grids are still animating
segments and locations. Therefore, targeted financial incentives the debate, shaping the regulatory framework and impacting the
might still be needed for some years to overcome costs or business models and the price for PV electricity to compete.
31
In addition to direct policies supporting PV development, other With the share of PV electricity growing in the electricity system of
indirect policies have a tremendous effect on PV development. several countries, the question of integration to the electricity grid
Sustainable building requirements, for instance, will become is becoming more acute. Simplification of inadequate and costly
increasingly essential to support a long-lasting PV market administrative barriers and streamlining of permit procedures is
development even if most of the time the requirements are also a driver and progress has been noted in most countries in the
technology agnostic. Electric vehicle development roadmaps last years.
will also have a direct impact on electricity demand, as well as
hydrogen production. Cross-sectoral aspects of PV development Today, climate policies have an indirect effect but are shifting the
will also imply that PV will be submitted to additional regulations competitiveness of renewable energy sources upwards.
and policies, in the building and transport sector, but also in
agriculture, the urban environment, water areas (including the
seas), industrial process and more...
FIGURE 3.1: EVOLUTION OF MARKET INCENTIVES AND ENABLERS: 2010, 2015, 2021
NON-INCENTIVIZED SELF-CONSUMPTION, 0,2%

TRADING OF GREEN CERTIFICATES OR TRADING OF GREEN CERTIFICATES OR
SIMILAR RPS-BASED SCHEMES, 3% SIMILAR RPS-BASED SCHEMES, 2%
DIRECT SUBSIDIES OR TAX BREAKS, 11% FEED-IN TARIFF THROUGH
TENDERS OR PPA, 7%
INCENTIVIZED SELF-CONSUMPTION
OR NET-METERING, 15%
2010 2015
DIRECT SUBSIDIES OR TAX BREAKS, 16%
FEED-IN TARIFF 85%

FEED-IN TARIFF 60%
TRADING OF GREEN CERTIFICATES OR

SIMILAR RPS-BASED SCHEMES, 3%
NON-INCENTIVIZED SELF-CONSUMPTION, 6%
FEED-IN TARIFF 28%
INCENTIVIZED SELF CONSUMPTION
OR NET METERING/NET BILLING, 10%
2021
DIRECT SUBSIDIES OR TAX BREAKS, 16%
NON INCENTIVIZED, 17%

FEED-IN TARIFF THROUGH
TENDERS OR PPA, 20%
32
PV MARKET DRIVERS AND SUPPORT SCHEMES
FIGURE 3.2A: MAIN DRIVERS OF THE DISTRIBUTED PV FIGURE 3.2B: MAIN DRIVERS OF THE CENTRALIZED PV
MARKET IN 2021 MARKET IN 2021
TRADING OF GREEN CERTIFICATES OR FEED-IN TARIFF THROUGH

SIMILAR RPS-BASED SCHEMES, 0,3% TENDERS OR PPA, 36%
TRADING OF GREEN CERTIFICATES OR
DIRECT SUBSIDIES OR TAX BREAKS, 9% SIMILAR RPS-BASED SCHEMES, 6%
FEED-IN TARIFF, 6%
NON-INCENTIVIZED
SELF-CONSUMPTION, 14%
78 DIRECT SUBSIDIES OR TAX BREAKS, 21%

95
GW GW
INCENTIVIZED SELF-CONSUMPTION
OR NET-METERING, 23%
NON INCENTIVIZED, 31%

FEED-IN TARIFF 54%
The question of market drivers is a complex one since the market Amongst the IEA PVPS members many countries had a FiT
is always driven by a combination of several regulations and scheme in 2021, in most cases to support the residential market
incentives. In these figures, the focus is put on the major driver (Australia, Canada, China, France, Germany, Japan, Portugal,
for each macro-segment (distributed or centralized), while other Switzerland) The attractiveness of FiT has been slightly reduced
drivers are playing a key role. This should be regarded as a general compared to the early developments of PV but so far it still
indication of the main PV drivers. represents a major driver of PV installation, although some
countries announced a phase-out (such as Austria in 2021, Kenya
in 2022). Depending on the country specifics, FiT can be defined at
FEED-IN TARIFFS the national level and at the regional, county or city level (Australia,
Globally, about 28% of the PV installations are receiving a predefined Canada, China, etc.) with some regions opting for it and others
tariff for part or all of their production; respectively 54% and 6% not, or with different characteristics. FiT can also be granted by
for the distributed and the centralized segments. There is a global utilities themselves (Switzerland), outside of the policy framework
trend towards lower tariffs. This decreasing FiTs are in line with to increase customer fidelity.
the price decrease of the PV technology. The increase seen in FiT remains a very simple instrument to develop PV, but it needs
2021, although possibly temporary, might put the brakes on the to be fine-tuned on a regular basis to ensure a stable market
tariffs decline. development. Indeed, the market can grow out of control if there
The concept of FiT is quite simple. Electricity produced by the is an imbalance between the level off the tariffs and the effective
PV system and injected into the grid is paid at a predefined price cost of PV systems, especially when the budget available for the
and guaranteed during a fixed period. FiT are paid in general by FiT payments is not limited. Most market booms in countries with
official bodies or utilities in order to set-up a PV market segment. unlimited FiT schemes were caused by the unpredictable steep
In theory, the price could be indexed on the inflation rate, but this price decrease of PV systems, while the level of the FiT was not
is rarely the case. The FiT model generally assumes that a PV adapted fast enough. This situation caused the market to grow
system produces electricity for injecting into the grid rather than out of control, mainly in early markets in European countries.
for local consumption. However, a FiT can be used to incentivize The market booms occurred in countries such as Spain in 2008,
self-consumption projects through a remuneration for the excess Czech Republic in 2010, Italy in 2011, Belgium in 2012, to a certain
electricity injected into the grid. extent in China in 2015, 2016 and 2017, and to a lesser extent
to other countries. Unfortunately, these booms have strained the
budget and negatively affected the public perception of PV, most
of these markets took years to recover and reexperience growth.
33
PV MARKET DRIVERS AND SUPPORT SCHEMES / CONTINUED
Therefore, many countries adopted the principle of decreasing FiT Impact of competitive tenders on the market
levels over time or introduced limited budgets. In Germany, the Tenders have driven PV development in the last years and
level of the FiT can be adapted monthly to reduce the profitability continued to be granted in several places in the world with
of PV investments if the market is growing faster than the target extremely competitive prices, well below 20 USD/MWh in the
decided by the government. In France, the FiT decrease is sunniest places. Winning bids down to almost 10 USD/MWh have
dependent on both installation rates and on economic indicators. been reported in the Middle East, while some tenders with prices
The economic indicators and government intervention also allows below 14 USD/MWh have been recorded in Europe (but these
for increased FiT if economic conditions (such as cost increases) can be questioned). The decreasing price trend halted in 2021
require it - and has been put in place retroactively in July 2022. due to module price hikes, and most experts believe that prices
will hardly continue to go down in the coming years, at least
until the raw material crisis can be solved. Since bidders must
FiT remains the most popular support scheme for compete with one another, they tend to reduce the bidding price
grid‑connected PV systems; especially for small to the minimum possible and shrink their margins. This process is
household rooftops applications. The ease of currently showing how low the bids can go under the constraint of
implementation continues to make it the most used competitive tenders. However, many experts believe such low bids
regulatory framework for PV globally. are only possible with extremely low capital costs, low component
costs and reduced risk hedging. The shrinking profit margins,
especially in super-competitive tenders, could become a threat to
FEED IN TARIFF AND PREMIUM THROUGH TENDERS
the long‑term stability of some market actors, hence creating more
Calls for tenders are another way to grant FiT schemes with an market concentration. This is already visible in 2021 with the major
indirect financial cap. This system has been adopted in many increase of prices due to the impact of the pandemic, which results
countries around the world, with the clear aim of increasing the in huge difficulties for some developers to remain competitive on
competitiveness of PV electricity. Around 36% of utility-scale plants already granted tenders. Therefore, it is conceivable that they do
were developed through tenders: this is a significant increase not represent the average PV price in all cases but are showcases
which started a few years ago. The relevance of this scheme for a for super-competitive developers.
distributed segment can be questioned and tenders experimented
in some countries for the smallest capacities have generally not Trends of technology neutral tenders and premium
been renewed, like in France. for local content
Tenders are often technology-specific, however, technology‑neutral
Tenders have gained success in the entire world over the last few
tenders are spreading. In this case, PV is put in competition with
years and Europe is aligned with this trend. In Australia, solar
other generation sources. Some countries such as Canada, France,
tenders come from a mix of state and local governments and
Germany, Spain and Italy are experimenting with mixed auctions
electricity retailers. In the Middle East and North Africa, tenders
based on solar and wind in parallel with some technology‑specific
were issued in Egypt, Israel, Jordan, Morocco, South Africa,
tenders. Tender can also be set to reach a capacity as it has been
Qatar, Koweit, and the UAE. In the rest of the world, many
experimented in Mexico.
others have joined the list of countries using calls for tenders. In
Latin America, Argentina, Brazil, Chile, Mexico, and Peru, just to In some countries, cost-based tenders evolve towards
mention the most visible, have implemented such tenders. In Asia, multiple‑factors tenders. Environmental or industrial constraints are
India, Nepal and Sri Lanka also started to launch tenders, while in introduced to give an advantage to local companies or to favour a
Southern Africa, Nigeria, Senegal, Tunisia, and Malawi can be better environmental footprint of the products. Competitive tenders
cited amongst the newcomers. can be used to promote specific technologies or impose additional
constraints such as local manufacturing to boost the local industry.
In several countries, a local content parameter has been discussed
and acts as an additional primary or secondary key in the grant
34
decision like in some African countries such as Algeria, Morocco INCENTIVIZED SELF-CONSUMPTION
and South Africa. This type of requirement aims at enabling the
Self-consumption, supported by different mechanisms such as
development of local solar module manufacturing. Turkey, for
net‑metering and net-billing, represented 23% of the distributed PV
instance, applies a premium for local content, on top of the normal
market, an important increase compared to historical installations.
FiT. In the USA, a tax rebate bonus is granted.
Various forms of support to self-consumption schemes exist.
The European Union is working on eco-design and environmental The first set of policies used to develop the market of small-scale
footprint frameworks. In France, a maximum level of carbon PV installations on buildings were called “net-metering” policies
footprint is set to access the tenders and lower carbon footprints and were adopted in a large number of countries, however,
gain bonus points to facilitate winning capacity. Even if it is not with different definitions. One must be careful when looking at
directly a local content specification, local manufacturing is indirectly self‑consumption schemes since the same vocabulary can imply
encouraged by the measures based on environmental impact. different regulations depending on the case. The best example is in
the USA, with the wording “net-metering” being used for different
Towards variable feed-in premium or “contract for difference” self-consumption schemes in different states.
In several countries, the FiT schemes awarded by auctions are Genuine “net-metering” which offers credits for PV electricity
being replaced by feed-in premiums. The premium is paid on injected into the grid, has previously supported market development
top of the wholesale electricity market price. Fixed and variable in Belgium, Canada, Denmark, the Netherlands, Portugal, Korea
premiums can be considered. Sweden and Austria are using a and the USA, but such policies are increasingly replaced by self-
fixed FiP for small decentralized systems. In Germany, France, consumption policies favouring real-time consumption of PV
Italy and the Netherlands, the remuneration of solar PV electricity electricity, often completed with a feed-in tariff (or feed-in premium
is based on a variable Feed-in Premium (FiP) that is paid on top added on top of the spot price) for the excess PV electricity fed into
of the average electricity wholesale market price for utility-scale the grid. This is for example the case in Spain and in France. As a
systems. A so‑called Contract for Difference scheme is a FiP result, self-consumption is becoming a major driver of distributed
that ensures constant remuneration by covering the difference PV installations. Although net-metering is being abolished in
between the expected remuneration and the electricity market historical markets, countries such as Thailand, Malaysia or
price. It also can generate reversed cash flows between generators Ecuador introduced net-metering for residential PV owners
and governments since late 2021 and the explosion in market recently. Several emerging PV countries have implemented
electricity prices. net‑metering schemes in recent years (Chile, Israel, Jordan, UAE
(Dubai) and Tunisia). While the self-consumption and net-metering
schemes are based on an energy compensation of electricity flows,
Tenders have not yet shown their full potential.
other systems exist. Italy attributes different prices to consumed
For the time being, they are mostly used to frame PV
electricity and the electricity fed into the grid.
development and PV costs. For regulators, this implies
defining a maximum capacity and proposing the
cheapest suitable plants to develop. However, it could
be developed further and be part of a larger, long-term,
roadmap on power capacity development. By planning
smartly, together with transmission grid operators,
tenders could allow to develop specific capacities
for defined technologies, optimize the grid and plan
smartly the energy transition to be an instrument to
support local industry.
35
PV MARKET DRIVERS AND SUPPORT SCHEMES / CONTINUED
DIRECT SUBSIDIES AND TAX BREAKS TRADE OF GREEN CERTIFICATES AND SIMILAR SCHEMES
With around 16% global market share, 9% for the distributed Green certificates and similar schemes based on Renewable
segment and 21% of the centralized segment, direct subsidies are Portfolio Standard” (RPS) represented around 3% of the market, a
still a common type of support for PV, most of the time they cover stable and low share which is explained by the greater complexity
only a part of the total installation cost. PV is characterized by limited of this type of scheme. Green certificate trading still exists in
maintenance costs, no fuel costs but high upfront investment. countries such as Belgium, Norway, Romania and Sweden.
This has led some countries to put policies in place that reduce Similar schemes based on RPS exist in Australia and Korea for
the upfront investment to incentivize PV. Direct subsidies were instance. The regulatory approach commonly referred to as
implemented in the early phase of PV development in countries RPS aims at promoting the development of renewable energy
such as Austria, Australia, Canada, Finland, Italy, Japan, sources by imposing a quota of RE sources. The authorities define
Korea, Lithuania, Norway, and Sweden just to mention a few. a share of electricity to be produced by renewable sources that
In most countries this support mechanism has not demonstrated all utilities must adopt, either by producing themselves or by
its ability to support and accelerate PV development and was buying specific certificates on the market. When available, these
replaced by FITs. In others countries a trend to reintroduce to this certificates are sometimes called “green certificates” and allow
mechanism seems to be observed. In others countries a trend to renewable electricity producers to get a variable remuneration for
reintroduce this mechanism seems to be observed. For instance their electricity, based on the market price of these certificates.
in Canada, the province of Alberta introduced a capital incentive This system exists in various forms. State incentives in the USA
program for commercial PV while the federal government have been driven in large part by the passage of Renewable
introduced one for homeowners. In Austria in 2021, the FIT Portfolio Standards (RPS). Different multipliers are applied to
came to an end, and either a market premium or an investment floating PV. In Belgium, all three regions use the trading of green
subsidy can support a PV system. This return to subsidies could be certificates for commercial and industrial segments.
questioned. Subsidies are a constraint to PV development because
they depend on public funding, which is, by nature, limited.
However, they are easy to set up which explains their utilization. PV DEVELOPMENT WITHOUT FINANCIAL INCENTIVES
Incentives can be granted by a wide variety of authorities or Figure 3.1 shows that in 2021, around 23% (6% and 17%) of the
sometimes by utilities themselves. They can be unique or add volume of the market became independent of support schemes:
up to each other. Their lifetime is generally quite short, with this implies installations not financially supported and developed
frequent policy changes, at least to adapt the financial parameters. outside of tenders or similar schemes. This is a sign of the PV market
Next to central governments, regional states or provinces can becoming highly competitive . The increase in energy costs in 2021
propose either the main incentive or some additional ones. and 2022, and specifically electricity prices, have enhanced PV
Municipalities are more and more involved in renewable energy competitiveness in numerous countries. PV development without
development and can offer additional advantages. In some cases, financial incentives is an important improvement, as it becomes
utilities are proposing specific deployment schemes to their own independent of any support scheme limitation.
customers, generally in the absence of national or local incentives,
but sometimes to complement them.
Tax credits have been used in a large variety of countries, ranging

from Belgium, Canada, Japan and others. Italy uses a tax credit
for small size plants. The debate was also intense in the USA in
2015 when extending the ITC (Investment Tax Credit), where tax
rebate is the main driver. In Sweden, the direct capital subsidy
for PV installations expired in 2020 replaced by a tax reduction
program. In Italy a new tax credit in the field of building energy
efficiency interventions including PV has been introduced.
36
Power Purchase Agreements Non-incentivized Self-consumption

Power Purchase Agreements (PPAs) are long-term private The PV system will be considered fully competitive when the
contracts between a PV producer and one or several consumers revenues from the savings on the electricity bill (the self-consumed
While FiT are paid in general by official bodies or utilities, part) and the revenues from the sales of excess PV electricity
commercial PPAs are contracts between the PV plant owner and will cover over the long-term the cost of installing, financing
an off-taker for the electricity produced, during a defined period. and operating the PV system. In most cases, the price of retail
Such contracts allow to guarantee a certain level of revenues and electricity will be higher than the wholesale price. Distributed PV
are increasingly popular for unsubsidized PV. Such contracts are evolves rapidly towards a competitive market, where new players
mainly deployed in the wind industry for the moment, while their and especially traditional utilities start to play a leading role
potential for PV remains largely untapped. The European Union
incites member states to remove administrative barriers to The question of grid costs for instance becomes more important
long‑term PPA and to facilitate their adoption. with rising PV penetration and is already leading in some countries
to specific tariffs which are reducing the competitiveness of
Electricity sold on electricity markets or through PPAs has been distributed PV installations. The arrival of new schemes based
seen in an increasing number of countries in 2021. Non-subsidized on the energy communities’ concepts could enlarge the market
models are gaining momentum for utility-scale PV. The trend is but also increases complexity while in some countries the
clear, PV plants selling their production to corporate customers joined PV with storage trend (such as in Germany) also paves
have emerged. Spain is probably leading the PPA market, if not the way for a different way of looking at PV development for
worldwide, at least in Europe. Over the last years, more and more distributed installations.
bilateral PPAs were signed between producers and consumers
and a large part of the ground-mounted installed capacity in 2021 Innovating Financial Solution Support
in Spain, 3,5 GW, was developed through PPAs. The reduced An increasing number of investment solutions have emerged
LCOE allows new market segment development, more recently for the financing of solar installations, these are even more
unsubsidized PPAs also appears in Korea, Denmark, Germany, relevant in the case of unsubsidized PV. The high upfront capacity
Italy, and Sweden. From 2022 onwards, the utility-scale segment requirements are pushing different business models to develop,
is developing under unsubsidised market conditions in Sweden. especially in the USA, and to a certain extent in some European
The USA and Australia are also markets where PPAs are gaining countries. PV-as-a‑service contributes significantly to the USA’s
market shares. In California, many PPAs, sometimes with record residential market for instance, with the idea that PV could be sold
low prices, were approved over the last years. PPAs imply sourcing as a service contract, not implying the ownership or the financing
of solar electricity without necessarily being physically connected of the installation. These business models could deeply transform
to the power plant, a solution favoured more and more by large the PV sector in the coming years, with their ability to include PV
companies willing to decrease their GHG emissions. in long term contracts, reducing the uncertainty for the contractor.
Such business models represent already more than 50% of the
Merchant PV residential market in the USA, and some utilities in Germany,
Merchant-based PV plants are expected to play a growing role in Austria, Sweden and Switzerland are starting to propose them,
the development of the PV market. They are PV plants where the as we will see below. However, the US case is innovative by the
business model relies on sales on electricity markets. The design existence of pure players proposing PV as their main product. Since
of the electricity market plays an important role for the emergence it solves many questions related to financing and operations, as
of this type of business model as the market should provide both well as reducing the uncertainty in the long-term for the prosumer,
short term and long-term incentives. it is possible that such services will further develop, along with the
necessary developments which will push up distributed PV.
37
Similarly, the pay-as-you-go financial models have been very In several regions in Belgium a grid tax will be implemented
successful in the deployment of Solar Home Systems (SHS) and for prosumers benefitting from net-metering which allows full
solar kits in African countries in the past years and are expected compensation of their PV consumption, grid cost included.
to further drive the development of PV in the residential and off-
grid segments. Pay-as-you-go models are directly inspired from Some countries impose specific grid codes on PV system owners
prepaid mobile payment schemes; the users pay a monthly fee or who are self-consuming electricity. In Australia for instance,
according to their needs and own the solar kit when enough credits grid injection limits exist in some states. Denmark imposes specific
have been paid. grid codes. Germany requires specific compliance with specific
grid codes for all PV systems. Other countries have imposed
specific grid codes as well. In most countries, the ownership of
the PV system can differ from the electricity consumer. This is a
PROSUMERS AND ENERGY complex situation with national regulations and no clear pattern
COMMUNITIES’ POLICIES appears today regarding third-party ownership.
While most countries accept self-consumption schemes for PV

systems installed on consumption sites, some specificities exist
SELF-CONSUMPTION IN REGULATORY ENVIRONMENTS in various parts of the world. Different forms of collective self-
consumption, both local and delocalized, are being implemented.
In recent years self-consumption regulations are increasingly
being implemented in different countries; the aim is to empower
prosumers to play an important role in the energy transition. COLLECTIVE SELF-CONSUMPTION
Measures in favour of distributed generation are stimulating
greater use of renewable sources with further positive effects Collective self-consumption enables the sharing of electricity
such as a stronger penetration of electricity in final consumption, between several users, but also under some conditions, between
the reduction of transmission and distribution costs and new distinct individual buildings. Self-consumption in collective buildings
investments in integrated energy management projects (electricity, or sites allows one or more production units to feed their electricity
heat, efficiency, storage, etc.). to several consumers, using a predefined split key. The typical
case concerns a multi-apartment building, with one single PV plant
Self-consumption is allowed one way or another in many countries feeding several or all consumers in the building.
but the regulations in place differ significantly. Sometimes with an
ad hoc legal framework, sometimes without. The very principle The use of self-consumption in collective buildings exists in
of self-consumption is always the same: the electricity that is Portugal, Spain, Austria, Canada, Sweden, France, Switzerland,
produced by the PV system and locally consumed reduces Germany or Italy to mention a few. Decentralized or distributed
mechanically the electricity bill of the consumer. But this reduction self-consumption is developed with the aim of disconnecting
is not implemented in the same way in all countries. It is generally production and consumption of PV electricity. This would allow one
accepted that variable grid costs on the part of PV electricity or several PV producers (even utility-scale plants) to feed one or
that is self-consumed should not be paid. In a more general way, more consumers at a reasonable distance so that the use of the
several countries have either modified the structure of the grid public grid is minimized. Such disconnection between production
tariffs (to increase the fixed part and reduce the variable part and consumption would help to alleviate the constraint of the local
linked to the consumption). In Australia and France, the shift from self-consumption ratio, and the constraint of non-PV suitable roofs
variable to fixed grid costs is debated actively and could lead to a and allow for better use of available space on roofs or land.
change in the electricity tariff structure that could be detrimental
These schemes allow self-produced electricity to reduce the PV
to PV development. In the USA, an intense debate on the cost
system owner’s electricity bill, on-site or even between distant
of net‑metering policies led to small grid costs increases for
sites (Mexico, Brazil, France). Various schemes exist that allow
prosumers. The case of Israel is more specific, with dedicated
compensation for electricity consumption and PV electricity
taxes for balancing and back-up. Specific grid taxes are starting
production, some compensate for real energy flows, while others
to be implemented in some countries, with the aim to compensate
are compensating for financial flows. While details may vary,
for saved grid costs due to net-metering policies. The Spanish grid
the basics are similar. The savings on the electricity bill can
tax is the only example of a specific tax for pure self-consumers.
38
be decreased if grid taxes or levies are to be paid on the self- perimeter and the tariffication for grid use. Those key components
consumed electricity. Fixed or capacity-based grid tariffs can also are defined in the national implementation in the member states.
have a detrimental effect on the revenues for the prosumers. This concept of energy communities is likely to expand the existing
PV market segments and allow cost reductions for consumers not
In Italy, since 2020 a measure allows consumers in the same able to invest in solar installation themselves.
building or in a “energy community” to share electricity and the
reform of the law is underway, which will make it possible to set
less stringent limits for participants. In Sweden, it had been allowed DELOCALIZED OR “VIRTUAL” SELF-CONSUMPTION
in 2021 for multi-family houses. In France since 2021, virtual
self‑consumption within a building, a 2 km, or exceptionally, a 20 km While self-consumption could be understood as the compensation
geographical perimeter is allowed and FIT for excess electricity. of production and consumption locally, decentralized (or “Virtual”)
In Germany, building owners can produce and sell electricity to self-consumption expands to delocalized consumption and
their tenants which makes the investment more attractive. The UK production and opens a wide range of possibilities involving ad hoc
has also implemented a favourable framework for collective grid tariffs. In that respect, prosumers at district level would pay
prosumers. Other countries have definitions but these are not yet fewer grid costs than prosumers at a regional or national level.
fully implemented. In Austria, collective self-consumption was Some utilities even launched pilot projects before the regulations
introduced a few years ago, but by the end of 2021, only hundreds were officially published (as in Austria or Switzerland). In this case,
of projects were recorded as it is frequently not seen as a sufficient innovative products are already mixed with PV installations, PV
financial benefit by the users as in the other pioneer countries. investment and virtual storage. This evolution will be scrutinized
These trends will maybe reverse if high retail prices of electricity in the coming years since it might open new market segments
remain and with the introduction of energy communities. for solar PV. But these schemes create complex questions,
especially regarding the use of the grid, the legal aspects related
In Australia, the support program closed in 2021. Current network to compensating electricity between several meters and the
pricing regulations in Australia stipulate that full network charges innovative aspect of the scheme.
must be paid even for locally transmitted electricity, which acts as
a barrier to collective self-consumption or virtual net-metering. The opportunities opened up by such concepts are wide-ranging.
Microgrids that include PV operate across the country, particularly For instance, this could allow charging an electric vehicle at the office
in new housing developments and in power supplies for remote with PV electricity produced at home or sharing the PV electricity in
communities. In Switzerland collective self-consumption is allowed all public buildings in a small town between them depending on the
by most DSOs, consumers have to be contiguous, the public grid consumption or installing a utility-scale plant in the field nearby a
is not used the internal metering is then under the responsibility of village to power it. Options are numerous and imply fair remuneration
the consortium. In the USA, community microgrids are emerging of the grid to be competitive for all. Using PV electricity in a
to reduce the cost of electricity consumption and provide local decentralized location implies the use of the public grid, distribution
resilience through storage and backup power. or even transmission and would require putting a fair price on such
use. With PV becoming competitive, such ideas are emerging and
could develop massively under the right regulations.
ENERGY COMMUNITIES IN THE EU CONTEXT
While self-consumption is allowed in most European countries, Europe To better compare existing and future self-consumption
has decided to go a step further with the comprehensive update of schemes, the IEA PVPS published a comprehensive
its energy policy, the “Clean Energy Package”. The European Union guide to analyse and compare self-consumption
introduced new provisions on the energy market design and policies. This “Review of PV Self-Consumption Policies”
frameworks for new energy initiatives. Specifically, the actual proposes a methodology to understand, analyse
recasts of the renewable energy directive (REDII) and the electricity and compare schemes that might be fundamentally
market directive (EMDII) provide basic definitions and requirements diverse, sometimes under the same wording. It also
for the activities of individual and collective self-consumption. proposes an analysis of the most important elements
The European Union introduced the concept of Renewable Energy impacting the business models of all stakeholders,
Communities (REC) and Citizen Energy Communities (CEC). REC from grid operators to electric utilities.
should allow citizens to sell renewable energy production to their
neighbours, while some crucial components are the definition of the
39
ENERGY TRANSITION POLITICS
SUSTAINABLE BUILDING REQUIREMENTS In Austria, the purchase of electric vehicles for private use is
supported. The proof of the use of electricity from 100% renewable
The building sector has a major role to play in PV development and
energy sources is a fundamental part of the support mechanism,
sustainable building regulations drive PV’s deployment in countries
which is the clear link to own PV production or electricity consumed
where the competitiveness of PV is close. These regulations
from hydropower, PV, and wind.
include requirements for new building developments (residential
and commercial) but also, in some cases, on properties for sale.
PV may be included in a suite of options for reducing the energy
HYDROGEN PRODUCTION
footprint of the building or specifically mandated as an inclusion in
the building development. The recent invasion of Ukraine by Russia and the international
sanctions that followed, pushed gas prices upwards. This might
European Union adopted several proposals to make the EU’s increase the drive towards a hydrogen-based economy in Europe.
climate, energy, transport and taxation policies fit for reducing net Solar fuels, storage and other hydrogen-based applications will
greenhouse emissions by at least 55% by 2030. The publication require massive PV, wind and other RES development. Distributed
of the European Commission’s Solar Strategy in 2022 is part of Hydrogen production could be driven by DPV as well, pushing
the RePowerEU package. It presents four initiatives to overcome for higher demand for distributed PV-H2 production. This is still
the remaining short-term challenges and first of them is promoting a distant prospect and significant developments before 2025 in
quick and massive PV deployment via the European Solar Rooftops Europe are unlikely, but this could start to become a business reality
Initiative. That can strongly influence the decentralized market in around 2025. The Commission expects green hydrogen to play a
European Union states. pivotal role in the decarbonisation of sectors where electrification
For instance, in France, the threshold for mandatory solar or might be less feasible and to bridge some of the gaps for seasonal
living roofs for commercial and industrial buildings or covered variations which is crucial for the further development of solar
car parks have been decreased. Actual thermal regulations, PV. Several funds are available to promote research and pilot
and incentive high-performance building labels encourage projects to increase the competitiveness of green hydrogen and
photovoltaics and self-consumption. In Austria, many counties the EU industry has developed an ambitious plan to reach between
have regulations or incentives for building a PV system. Up to now 15GW and 40 GW, on a low and high case scenario respectively, of
in Vienna and Styria it is obligatory to install a PV system under electrolysers in Europe by 2030.
certain conditions. In Korea, the NRE Mandatory Use for Public
Buildings Programme imposes on new public institution buildings
ELECTRICITY STORAGE
with floor areas exceeding 1 000 square meters to source more
than 10% of their energy consumption from new and renewable In the current stage of development, electricity storage remains
sources. In Belgium, Flanders introduced a similar measure since to be incentivized to develop. However, the cost of storage is
2014. The first results show that PV is chosen in more than 85% pursuing its steep decline and storage is becoming more attractive
of the new buildings. In Denmark, the national building code has in a growing number of markets. Due to the cost decline of
integrated PV to reduce the energy footprint. storage, solar power plants with onsite storage are increasingly
attractive for developers as the combination with storage allows to
smooth the power output, to deliver ancillary services or to reduce
ELECTRIC MOBILITY connection costs if peak injection is reduced.
The development of electric mobility represents an important for the Amongst the countries that have issued laws to incentivize battery
PV sector as the need for clean energy will increase. Furthermore, storage in PV systems to 2021, Austria, the subsidies support
charging points can be coupled with solar PV on parking shelters the construction, expansion and combination of new or existing
for instance. In Europe, National and local-level actions exist to PV systems with electricity storage if storage capacity is at
support EV deployment, an overall trend is the increasing number least 0,5 kWh per kW peak is installed. In Australia, most state
of European cities playing a prominent role to address market governments are now offering some type of incentive for solar plus
barriers to EV uptake. The aim of the cities’ programs is mainly to battery installations or to add a battery to an existing solar system.
deploy charging infrastructure in an integrated and homogenous In France in 2020, a tender was launched to provide low carbon
way and to increase the visibility of EV solutions. flexibility for the grid, with around two-thirds of the selected projects
based on storage, the rest on load shifting. This tender doubled the
40
cumulated installed capacity connected to the medium‑voltage Despite the overall benefits of grid expansion, the costs of network
grid. In Australia, Victoria has announced a plan for clean energy upgrades must still be distributed between the end users through
including the biggest battery in the southern hemisphere. In grid tariffs, also called network tariffs. Network tariffs are designed
2021, the market operator changed the settlement period for to recover the costs of investing and operating electricity networks.
self‑consumption from 30 minute to 5 min, providing a better price Tariffs should be used to incentivise efficiency in both network use
signal for investment in faster response technologies, such as and investment. For instance, grid reinforcement is not always
batteries and gas peaking generators. There are numerous trials the most cost-efficient way to integrate RES: in some cases,
of virtual power plants, demand response and battery integration. local storage or demand side management might be available
at a lower cost. Therefore, grid tariffs should increasingly be
Storage is a key element of a carbon neutral energy system relying time-variable and location-based. Cost-reflective rate structures
on RES electricity; therefore, the European Commission actively should provide the right incentives to develop local storage or
supports energy storage through research and innovation funds. load control. Tariffs are effective tools to drive investments,
Some consider that storage development for PV electricity will be however, some objectives may require different types, sometimes
massively realized through electric vehicles connected to the grid incompatible, price signals or some objectives may evolve over
during a large part of the day and therefore, will be able to store time. Furthermore, despite the role that grid tariffs can play to give
and deliver energy to consumers at a larger scale than simple price signals to consumers, other tools exist and can be required
batteries. This vehicle-to-grid or V2 G concepts are being explored to achieve certain goals. Therefore, the priority of grid tariffs
and tested in several countries, with the Netherlands, Switzerland should be to accurately reflect cost while also keeping the overall
and Japan as front-runners. rationale transparent, future‑proof and simple for consumers to
understand and implement. A coherency between distribution and
transmission grid tariffs is needed to avoid conflicting price signals,
GRID INTEGRATION
hence market responses that cancel each other out for instance.
With the share of PV electricity growing in the electricity system of
several countries, the question of integration to the electricity grid is By submitting PV applications to stricter grid codes and regulations,
becoming more acute. In some countries, temporary or permanent connecting PV systems to the grid becomes more complex and
curtailment rules have been devised to avoid grid reinforcement or therefore more costly. The increased need to provide ancillary
to avoid grid congestion in the meantime. In China, the adequacy services to the grid, including frequency response for instance,
of the grid remains one important question that pushed the and curtailment, changes the nature of the connection for the PV
government to favour the development of decentralized PV in system and can increase prices or reduce revenues. This influences
the future over large utility-scale power plants. It is interesting to the competitiveness of PV solutions.
note that many transmission system operators are increasing the Grid codes have been reviewed in the European Union in an
penetration of PV in their scenarios and try to assess the impact attempt to harmonise grid codes between member states and
of such developments. Such scenarios and calculations have been will lead to additional constraints for PV systems. In Australia,
done by many TSOs and show how important PV development specific grid codes have been adapted for PV and more will
starts to become. come. In Mexico, specific grid requirements have in some cases
The EU also set an indicative target of 15% interconnection towards been imposed to bidders in tendering processes. In any case,
2030 and 93 GW additional cross-border capacity is needed by 2040 grid integration policies will become an important subject in the
to achieve the EU Green Deal. Interconnections with neighbouring coming years, with the need to regulate PV installations in densely
countries combined with international electricity trade contribute equipped areas.
to lower electricity prices, improve security of supply and reduce
the need to build new power plants and flexibility assets to manage
renewable power sources like solar and wind.
41
INDUSTRIAL AND
MANUFACTURING POLICIES
Grid costs are another essential element, which deals with
PV competitiveness, especially for distributed PV applications
2021 has seen numerous initiatives favouring local manufacturing
under self-consumption. Since the competitiveness of the
at various steps of the PV value chain. The increasing importance
solution depends on the ability to reduce the electricity bill of the
of PV in the energy sector, and its expected growth are pushing
consumer, the grid costs might affect the outcome tremendously.
numerous governments to support local manufacturing through
In particular, several countries discuss the shift of grid costs from
policies, subsidies and regulations.
an energy‑based structure towards a capacity-based structure:
this would affect significantly the profitability of distributed PV While trade conflicts have diminished in intensity in the last years,
plants if all grid costs would have to be paid, even with large shares the willingness to support local production has increased with
of the energy produced on site. The reason behind this originates initiatives in Europe, the USA, India, Morocco or Saudi Arabia.
from the loss of incomes of grid operators who see their revenues This reflects the growing perception of the importance that PV
and therefore their capacity to invest and maintain the grid, being could take in the coming years and the willingness to secure
reduced significantly if prosumers or semi-independent energy strategic production in some countries.
communities would become the new normal.
This trend is increasing globally, often without a clear understanding
The example of decentralized self-consumption indicates how of the industry dynamics and the complexities of PV manufacturing,
important it will be for the grids to know their real costs and invoice which will lead to fewer real projects than what some governments
prosumers with a fair tariff depending on the real use of the grids. would like to see.
The changing electricity landscape with the fast development of
electric mobility in several countries, the development of distributed In addition to this, the growing share of PV in the production of some
storage and the expected electrification of heating, would deserve components, like glass sheets for instance, starts to represent a
a long-term analysis to find the right balance between the different growing share of the total production, with local and global impacts
incentives that grid tariffs ultimately provide. in case of shortage as seen in China in 2021. In that respect,
local manufacturing will imply access to global value chains and
the role of already existing global actors shouldn’t be neglected.
The EU Solar Energy Strategy is part of the REPowerEU plan.

By launching a European Solar PV Industry Alliance that aims to
facilitate innovation-driven expansion of a resilient industrial solar
value chain in the EU, particularly in the PV manufacturing sector.
42
four
TRENDS IN PV INDUSTRY
This chapter provides a brief overview of the upstream and of manufacturing locations have been pointed out. Policy and
downstream sectors of the PV industry, intending to summarise measures of local manufacturing have started in various regions.
highlights from 2021 and the first half of 2022. The first part Trade conflict and political stance over forced labor also backed
covers manufacturing activities of the upstream sector of the these trends.
PV industry from feedstocks (polysilicon, ingots, blocks/bricks,
and wafers) to PV cells and modules as described in figure 4.1
and activities of the balance-of-systems (BOS). The second part
covers activities such as project development and operation and
THE UPSTREAM PV SECTOR
maintenance (O&M).
Throughout 2021, an increase of the prices of PV modules and POLYSILICON PRODUCTION

other components was observed. This affected planned projects.
The price level of PV modules was mostly driven by the high Wafer-based c-Si technology remains dominant for producing
polysilicon price. The speed of polysilicon demand increase PV cells. In that respect, this section focuses on the wafer-based
was higher than that of capacity enhancements. This situation production process. The global polysilicon production (including
continued in the first half of 2022. Other factors, such as the silver semiconductor grade polysilicon) in 2021 was about 644 100 tonnes.
and aluminum price increase, which are respectively used for Polysilicon used for solar cells increased from 497 300 tonnes
electrodes and frames, also affected the price hike of PV modules. in 2020 to approximately. 604 812 tonnes in 2021, while 39 300
In addition, high logistic costs also contributed to the price increase. tonnes of polysilicon were used for the semiconductor industry.
The shortage of semiconductors also impacted inverters supply. The production volume of polysilicon for solar cells accounted for
about 94% of total production of polysilicon in 2021. Figure 4.2
In 2021, China remained the world’s largest producer along the PV shows the share of polysilicon production by country.
supply chain and further enhancement of manufacturing capacity
was reported. While PV power generation is expected to take
a significant role in energy transition, risks of heavy concentration
43
THE UPSTREAM PV SECTOR / CONTINUED
FIGURE 4.1: PV SYSTEM VALUE CHAIN (EXAMPLE OF CRYSTALLINE SILICON PV TECHNOLOGY)
SILICON FEEDSTOCK
CAST SILICON FURNACE WAFER DOPING MATERIAL
MONO-CRYSTALLINE Si
SINGLE CRYSTAL GROWING FURNACE QUARTZ CRUCIBLE
MULTI-CRYSTALLINE Si
SLICING EQUIPMENT WIRE (FOR WIRE SAW SLICING)
ABRASIVE GRAIN, SLURRY (FOR WIRE SAW SLICING)
TEXTURE TREATMENT EQUIPMENT
DIFFUSION FURNACE ETCHING & TEXTURING SOLUTION
DEPOSITION EQUIPMENT CELL ANTIREFLECTIVE FILM
SCREEN PRINTING EQUIPMENT METALLIZATION MATERIAL
FIRING FURNACE
TEDLAR/PET
EVA
LAMINATOR MODULE INTERCONNECTOR
WHITE TEMPERED GLASS
ALUMINUM FRAME
JUNCTION BOX
INVERTER
BATTERY
MOUNT STRUCTURE
EQUIPMENT FOR GRID CONNECTION
VARIOUS TYPES OF LOAD, DEPENDING ON APPLICATIONS
DESIGN, INSTALLATION TECHNOLOGIES
PV SYSTEM
SOURCE IEA PVPS & OTHERS.
FIGURE 4.2: SHARE OF PV POLYSILICON PRODUCTION IEA PVPS member countries producing polysilicon are China,
IN 2021 Germany, USA, Malaysia, Korea, Norway and Japan. China
continued to be the largest producer and consumer of polysilicon
OTHER, 2%
MALAYSIA, 4% in the world, China produced 623 000 tonnes of polysilicon in
USA, 5% 2021, 79% of the global production. China’s polysilicon production
capacity accounted for 78% of the global production capacity
GERMANY, 10% in 2021, an increase of 3,% compared to 75,% in 2020. As was
mentioned, most of new capacity addition is planned in China
CHINA, 79%
including new polysilicon factories by new entrants. The production
capacity in 2022 is expected to reach 992 000 tonnes/year in China
if all the announced plans would be implemented. The second
largest producer is Germany, where 65 000 tonnes of polysilicon
were produced in which almost 60 000 can be considered to have
been consumed for PV production. Malaysia is the third largest
SOURCE IEA PVPS, RTS CORPORATION producer with a capacity of, with 3 0000 tonnes/year. In the USA,
* INCLUDING POLYSILICON FOR SEMICONDUCTORS
most of the production was used by the semiconductor industry
44
as in the previous year, due to the Chinese government tariffs The decrease of electricity consumption under the reduction
imposed on the US-made polysilicon. Norway reported activities process has been achieved by the efforts including the following:
of polysilicon manufacturers adopting the metallurgical process 1. the development and commercialization of large-scale
aiming at lowering the production cost. In Norway, approx. reduction furnaces;
6 500 tonnes of polysilicon are estimated to have been produced
2. the improvement of the inner wall materials of the furnace;
in 2021. In Japan and Korea, polysilicon production is mainly
dedicated to the semiconductor industry. 3. the replacement of the conventional silicon tube with a silicon
core and
A supply and demand gap of polysilicon was foreseen in 2021.
4. the adjustment of the gas mix.
The polysilicon price increased from 10, USD/kg by the end of
December 2020 to 29 USD/kg by the end of May 2021. In June, It has been said that electricity consumption can be further reduced
the Chinese Photovoltaic Industry Association (CPIA) issued a by additional process optimization and the economy of scale. It
statement urging the national government to take appropriate is assumed that it would contribute to the reduction of polysilicon
action in response to the soaring polysilicon prices. Afterwards, prices. Besides the Siemens process, fluidized bed reactor (FBR)
the polysilicon price showed a short drop during July and August is used to produce polysilicon. The advantage of the process is a
2021 However, due to the electricity crunch that occurred and the lower energy consumption and granular shaped products, which
shutdown of some polysilicon plants, the prices reached 33 USD/ can be fully packed in the crucibles. In July 2022, GCL Technology
kg by the end of September. In 2022, the high prices maintained in China started operations of two new FBR process plants in
for polysilicon due to the demand growth and to the shutdown of Jiangsu and Leshan with 30,000 tonnes/year and 100 000 tonnes/
several plants, because of the electricity shortage in China. By the year capacity, respectively. According to GCL, the total electricity
end of 2022, the global manufacturing capacity of polysilicon is consumption of this process is 14,8 kWh/g and the quality meets
expected to reach more than 1 650 000 tonnes/year, more than the requirement for n-type sc-Si wafers.
double of the previous year. If the new polysilicon plants would
start operations as scheduled, a stabilization of the polysilicon In 2021, the USA decided to ban US imports of material from
prices is expected after the second half of 2022. Chinese-based Hoshine Silicon Industry that produces metallic
silicon, a base material of polysilicon,. With this measure, future
In the first half of 2022, China produced 365 000 tonnes of polysilicon, production locations might change but for the time being, China
a 53% increase from the same period in 2021. The polysilicon price is assumed to remain the global top producer of polysilicon.
remained high due to the demand growth and the gap between Then, in July 2021, the US administration established Uyghur
supply and demand. In July 2022, one polysilicon plant shut down Forced Labor Prevention Act (UFLPA) and started to enforce the
due to an accident and several plants halted operation for regular ban on solar products made in Xinjian Uyghur. Because of this
inspection. The reported spot price of polysilicon as of the end of measure, new polysilicon plants are planned in Inner Mongolia and
July 2022 reached 38 USD/kg. other regions outside of Xinjian Uyghur. The measure is expected
to accelerate the traceability of the product’s origins. It is also
With the improvement of conversion efficiency of PV cells and
expected to trigger an increase of the US polysilicon production
modules and the efforts to reduce the use of materials (thinning
for the PV sector with the Biden administration’s efforts to recover
of wafers), the amount of polysilicon used for 1 W of wafer
the US PV manufacturing.
(consumption unit of polysilicon) has been decreasing year after
year. In 2021, it is estimated that average 3,1 g/W of polysilicon was
used for a solar cell, and it decreased to average 2,7 g/W in 2021.
INGOTS & WAFERS
Compared to 6,8 g/W in 2010, the consumption unit of polysilicon
decreased at a pace of ~9% annually. To produce sc-Si ingots or mc-Si ingots, the basic input material
consists of highly purified polysilicon. The ingots need to be cut
Most of major polysilicon manufacturers use the Siemens into bricks or blocks and then sawn into thin wafers. Conventional
process, which has been conceived as a manufacturing process silicon ingots are of two types: sc-Si ingots and mc-Si ingots.
of polysilicon for the semiconductor industry. It is estimated that The first type, although with different specifications depending on
the Siemens process polysilicon accounted for 98% of the total purity and specific dopants, is also produced for microelectronics
production. Reported production efficiency has improved, and the applications, while mc-Si ingots are only used in the PV industry.
energy consumption of the whole process to produce polysilicon Ingot manufacturers are in many cases also wafer manufacturers.
decreased from 66,5 kWh/kg in 2020 to 63 kWh/kg in 2021.
45
In addition to major ingot/wafer manufacturers, some PV cell/ In the first half of 2022, China manufactured 152,8 GW of wafers, a
module manufacturers also partly manufacture silicon ingots 45,5% increase of the previous year. In 2022, further increase of the
and wafers for their own in-house use. Due to the cost pressure, share of larger-sized wafers is expected. Tungsten wires are used
some of these major PV module manufacturers that established instead of diamond wires, in order to reduce the wafer thickness.
vertically integrated manufacturing are shifting to procuring
wafers from specialized manufacturers because of the cost and The spot price of c-Si wafers generally follows the price of
quality advantages. polysilicon. In January 2021, the price of sc-Si wafer (158,75 mm/
161,75 mm) was 0,34 USD/piece and increased to 0,74 USD/piece
The global wafer production amounted to 233 GW in 2021, a 39% in November 2021. In July 2022, the reported price of the same
increase from 2020. The production capacity of wafers as of the size was 0,779 USD/piece. Lager wafers (182 mm) were priced at
end of 2021 reached 415 GW/year from 218 GW/year in 2020. 0,969 USD/piece.
It is notable that production capacity and the volume for mc-Si
wafers decreased while those of sc-Si wafers increased due to the Outside of China, wafer manufacturing capacities were reported
demand for higher efficiency PV modules. As shown in Figure 4.3, in Malaysia, Vietnam, Norway and Taiwan. New capacities were
China has more than 97% of the global production of wafers. In announced in several countries in 2021 and later. In India, Emmvee
2021, China produced 226,6 GW of wafers, a 40% year-on-year Photovoltaic Power is planning vertical production from wafers to
increase. Among them, around 22,6 GW of wafers are exported to PV modules. Companies such as CIL Solar PV are planning wafer
other PV cell manufacturing countries such as Malaysia, Vietnam, production in India utilizing the government subsidy. Astrasun Solar
Thailand, Korea, Taiwan and India. in Hungary is planning to establish 1,8 GW/year line in a vertical
production plant. French company, Carbon is planning to include
wafer capacity in France. In Russia, Hevel Solar is planning
1,3 GW/year of production capacity as a part of HJT PV cell/ module
FIGURE 4.3: SHARE OF PV WAFER PRODUCTION IN 2021 production. Russian Unigreen Energy also worked on 1,3 GW/year
production line of n-type ingots and wafers.
OTHER, 3% In Spain, Greenland Gigafactory announced a plan to establish a

wafer production factory in Sevilla as part of a plan to establish
vertically integrated PV fab. In Turkey, Kalyon Solar Technologies
established a 500 MW/year PV manufacturing plant including the
wafer process. In India, wafer manufacturing is planned by several
CHINA, 97%
companies as a part of PV manufacturing plans combined with
the utility-scale projects rights. Chinese companies also plan to
have wafer capacity production outside of China. For example,
ET Solar is planning to build a 5 GW/year wafer plant in Vietnam.
JinkoSolar announced a plan to build a 7 GW/year ingot/wafer plant
in Vietnam in 2022.
SOURCE IEA PVPS, RTS CORPORATION Startup companies in the USA and Europe are developing a kerfless
manufacturing process to manufacture wafers without using
In 2021, it was notable that the share of large-sized wafers conventional ingot growth or wire-sawing processes. CubicPV in
increased. 158,75 to 166 mm sized wafers accounted for around the USA established by the merger of 1366 Technologies and
50% of the total production and the share of large-sized 182 (M10) Hunt Perovskite Technologies is planning to establish a 2-GW
to 210 (M12) mm wafers increased from 4,5% in 2020 to 45%. It is wafer manufacturing facility in India with the direct wafer
expected that the share of large-sized wafers will increase further process. Nexwafe (Germany) financed several million Euros for
and that they will become major products by 2030. A reduction of the commercialization of its Epiwafers technology to establish
the wafer thickness was reported in 2021. In 2020, the thickness a 500 MW/year factory by 2024. Other companies working on new
of 158,75 - 166 mm wafers were 175 to 180 μm. It decreased to technologies include Leading Edge Crystal Technologies (USA)
160 μm in 2021 due to the efforts to reduce polysilicon usage. and Crystal Solar (USA).
The thickness of larger wafers in 2021 was 165 μm and is expected
to be 155 μm in 2022.
46
SOLAR CELL AND MODULEPRODUCTION FIGURE 4.4: SHARE OF PV CELL PRODUCTION IN 2021
Solar Cell Production JAPAN, 0,2%

SINGAPORE, 0,5%
OTHER, 0,6%
The global solar cell (c-Si and thin-film solar cell) production INDIA, 0.9%
TAIWAN, 0,9%
reached around 241 GW in 2021, a 35,4% increase from 2020 USA,1,0%
EUROPE, 1,3%
THAILAND, 2,1%
(178 GW). The global manufacturing capacity as of the end SOUTH KOREA, 2,3%
VIETNAM, 3,6% CHINA, 81,2%
of 2021 is around 441 GW/year. As in the previous year, China
MALAYSIA, 5,4%
was the world’s largest producing country of solar cells. China
produced around 198 GW of solar cells in 2021, a 46,8% increase
from 135 GW in 2021. China’s reported solar cell manufacturing
capacity is 360 GW/year in the end of 2021. 160 GW/year have
been added from 2020 onwards. As shown in Figure 4.4, China’s
solar cell production volume accounts for 82,2% of the total global
production. As shown in Table 4.1, the top 5 solar cell manufacturers
are Chinese companies.
SOURCE IEA PVPS, RTS CORPORATION
TABLE 4.1: GLOBAL TOP FIVE MANUFACTURERS IN TERMS OF PV CELL/MODULE PRODUCTION AND SHIPMENT
VOLUME (2021)
RANK SOLAR CELL PRODUCTION (GW) PV MODULE PRODUCTION (GW) PV MODULE SHIPMENT (GW)
1 TONGWEI SOLAR 32,9 LONGI GREEN ENERGY TECHNOLOGY 38,9 LONGI GREEN ENERGY TECHNOLOGY 38,5
2 LONGI GREEN ENERGY TECHNOLOGY 29,6 TRINA SOLAR 26,2 JA SOLAR TECHNOLOGY 25,5
3 JA SOLAR TECHNOLOGY 21,2 JA SOLAR TECHNOLOGY 25,9 TRINA SOLAR 24,8
4 SHANGHAI AIKO SOLAR ENERGY 19,5 JINKOSOLAR 21,4 JINKOSOLAR 22,2
5 TRINA SOLAR 18,9 CANADIAN SOLAR 16,7 CANADIAN SOLAR 14,5
NOTE: PRODUCTION VOLUMES ARE MANUFACTURERS’ OWN PRODUCTION, WHEREAS SOURCE RTS CORPORATION (WITH SOME ESTIMATES)
SHIPMENT VOLUMES INCLUDE COMMISSIONED PRODUCTION AND OEM PROCUREMENT.
The countries besides China which have reported production of 85% from 76% in 2020. The BSF technology share decreased to
solar cells are Malaysia (13,1 GW), Vietnam (8,8 GW), Korea less than 10%. The share of higher efficiency technologies such
(5,5 GW), and Thailand (5 GW). Europe, USA, India and Japan as Si-heterojunction (SHJ) and back contacts, including metal
also reported production. Figure 4.4 shows the production share wrap through, remained around 5%. As in the previous years,
of solar cell by country in 2021. Thailand and Vietnam are not investment in these technologies has been active throughout
subject to the safeguard tariffs by the USA and the production 2021. More than 20 companies are planning to produce and
capacities are increasing in these countries. As of 2021, Malaysia commercialize SHJ technologies. In China, the share of n-type Si
had 18,6 GW/year of solar cell capacity. Vietnam and Thailand high efficiency technologies in 2021 remains at 3%. It is expected
had 17 GW/year and 9,7 GW/year, respectively. In the USA, the to increase to 13% in 2020. As mentioned in the wafer section, the
solar cell production is mainly conducted by First Solar with their size of solar cells has become larger, adopting M10 or M12 wafers.
CdTe thin-film PV technology. As for c-Si solar cells, the demand In 2021, it is notable that the share of bifacial solar cells in the global
for high efficiency solar cells has continued increasing. The share market reached 50%. It is expected to reach more than 60% in
of sc-Si solar cells increased to 89% and the mc-Si share is 2022. One of the reasons of this growth is that bifacial products are
around 7,7% in 2021. According to the ITRPV 2021 report, the exempted of the US safeguard duties. Also, the output increase
share of PERC/PERT/PERL/TOPCon technologies reached around with single axis tracker contributed to the market growth.
47
As for wafer prices, cell prices were also affected by the polysilicon FIGURE 4.5: SHARE OF PV MODULE PRODUCTION IN 2021
price. In January 2021, the mono-PERC cell spot price was between
CANADA, 0,2%
0,12 to 0,14 USD/W depending on the wafer size. The price level SINGAPORE, 0,5%
JAPAN, 0,9%
increased to 0,15 to 0,19 USD/W in November 2021. After that, TAIWAN, 0,9%
EUROPE, 0,9%
the price changed according to the demand and as of July 2022, THAILAND, 1,2%
OTHER, 1,9%
the price range is 0,155 to 0,18 USD/W. INDIA, 2,1%
USA, 2,7%
SOUTH KOREA, 3,3% CHINA, 75%
In the first half of 2022, China produced 135,5 GW of c-Si solar MALAYSIA, 3,7%
cells, a 46,6% increase from the previous year (123,6 GW).
VIETNAM, 6,8%
Announcements of commercialization of n-type Si solar cell
have been observed, these account for one third of announced
production enhancements. In China, major utility companies
conducted tenders using n-type technologies. The demand for
n-type technologies was more than 4 GW.
Among the materials used for solar cells, the price of silver soared
in 2021. According to the Silver Institute, the silver price increased SOURCE IEA PVPS, RTS CORPORATION
by around 22% in 2021. For this reason, solar cell manufactures
are making efforts to reduce silver consumption in the electrodes. In case of the USA, its policy to guard domestic manufacturers
The replacement of silver by copper or aluminum is also being with import duties, PV module production capacity has been
considered by manufacturers and suppliers. increasing and it is expected that its production will increase as
President Biden announced to increase the US production capacity
to 22,5 GW/year by 2024 and incentives for production will be
SOLAR MODULE PRODUCTION implemented under the Inflation Reduction Act enforced in August
Global PV module production (c-Si PV module and thin-film PV 2022. Local production of PV modules is being promoted in India
module) showed an increase following the global demand for PV and Europe as well. It is expected that higher logistic costs and the
system installation from 178,5 GW in 2020 to 242 GW in 2021. demand for a lower carbon footprint, the economic stimulation and
As shown in Figure 4.5, as in 2020, China continued to be the the risk mitigation depending on specific production locations will
largest producer of PV modules in the world. China produced diversify the manufacturing sites in the coming years.
181,8 GW of PV modules in 2021 with 359 GW/year of production
The PV module prices also kept higher levels in 2021, mainly due
capacity. In 2021, the amount of exported PV modules from China
to the higher polysilicon prices. In January 2021, the average
achieved its highest record in history according to CPIA, Chinese
spot price of a typical sc-Si PV module was 19,2 USD cents/W.
PV Industry Association. About 98,5 GW of PV modules were
It increased to 26 USD cents/W in October 2021. By the end of
shipped to overseas markets. As shown in Table 4.1, the top 5 PV
December 2021, it dropped to 24,7 USD cents/W. In July 2022,
module manufacturers are Chinese companies.
the price level remained high at 25,6 USD cents/W. Besides
As in 2020, the second largest PV module producing country polysilicon, glass and polymer materials also had impacts on the
in 2021 was Vietnam with 16,4 GW, a 13,8% increase from the PV module prices. According to a statement issued in September
previous year (14,13 GW). Malaysia (9,1 GW) ranked third and 2021 by the five major Chinese PV module manufacturers (LONGi
Korea ranked fourth with 8 GW of PV module production. The USA Green Energy Technology, JinkoSolar, and Trina Solar, JA Solar
ranked fifth with 6,6 GW of PV module production. Technology and Risen Energy), the price of glass for PV modules
increased by 18,2% from August 2021 and the EVA price soared
35% in August in 2021. The tight supply caused by higher demand
and electricity consumption control, resulted in the prices of these
components showing a rise and fluctuations. It is expected that the
expansion of the manufacturing capacity of these materials will
stabilize the prices and the replacement of EVA to polyolefin will
be advanced.
48
SOLAR MODULE TECHNOLOGY in Malaysia, USA, Japan, Germany, and China. In many of the
IEA PVPS member countries, R&D and commercialization efforts
on CIGS thin-film PV modules focus on the improvement of
FIGURE 4.6: PV MODULE PRODUCTION PER TECHNOLOGY
conversion efficiency and throughput as well as the enlargement
IN IEA PVPS COUNTRIES IN 2021
of module size. Application for a tandem solar cell using c-silicon
and perovskite technologies is also studied. The share of thin‑film
300
PV modules in this segment is expected to grow for specific
applications for curved surfaces, windows, or skylights with light
250 transmitting functions, applications requiring lightweight modules.
200
High-efficiency multi-junction PV cells/modules have been
produced, mainly using III-V materials for space applications.
R&D activities for high-efficiency multi-junction (MJ) PV have
GW 150
been active in the USA, Europe and Japan. R&D for tandem
solar cells using c-Si and MJ cells is also continued in these
100 countries. Hydrogen synthesis using high-efficiency cells is also
studied and demonstrated. Application of CPV for agricultural PV
50 is demonstrated. Demonstration of MJ PV for EV is conducted
in Japan.
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Following the rapid improvement of conversion efficiency in a short
Thin-film sc-Si mc-Si
time, efforts on the commercialization of PV cells/modules were
reported in 2021 and 2022. In China, several companies are working
on commercialization. Hangzhou Microquanta Semiconductor
SOURCE IEA PVPS, RTS CORPORATION
announced that it shipped 5 000 pieces of perovskite PV modules in
July 2022. Shenzhen Infinite Solar Energy Technology successfully
In 2021, as shown in Figure 4.6, the share of c-Si PV module was secured financing, targeting to establish a pilot production line
96,6%, a slight increase from 96,4% in the previous year. Among in 2022. GCL Optoelectronics announced it installed perovskite
c-Si technologies, sc-Si increased its share from 81,9% to 88,9% in PV modules in the facilities used for the Winter Olympic games
2021. As mentioned in the section on wafers and cells, the adoption in 2022. In addition to these Chinese companies, Wonder Solar
of larger-sized solar cells increased. PV modules adopting half-cut started to establish a 200 MW/year pilot line aiming at developing
c-Si solar cells have more than 80% share of the total in 2021. a 1 GW factory in 2022. Outside of China, Saule Technologies
The shingled PV module technology (overlapping the edges of (Poland) completed a manufacturing facility for flexible perovskite
solar cells without ribbons) and the seamless soldering technology solar cells in May 2021. In the UK, PowerRoll started a roll-to-roll
were also adopted. pilot production line in February 2022. In the USA, Swift Solar is
working on flexible PV modules.
Thin-film silicon technologies slightly lost their share from 3,6%
to 3,4%. About 8,2 GW of thin-film PV modules were produced Commercialization of tandem technologies using perovskite
in 2021. Among them, 7,9 GW were CdTe PV modules produced and c-Si solar cell is also globally active. Oxford PV in the UK
by First Solar (USA). Other thin-film technologies produced in completed a 100 MW/year production line for perovskite/ c-Si
2021 were CIGS with less than 500 MW and amorphous-silicon tandem PV in July 2021. While announcements of efforts have
PV modules. In 2021, Solar Frontier, a Japanese CIS thin-film PV been reported, it remains to be seen if perovskite technology could
module manufacturer decided to withdraw from manufacturing replace some of the market shares of conventional c-Si or thin-film
in order to shift to the PV system installation business utilizing PV module technologies.
c-Si technologies. Thin-film PV modules were mainly produced
49
FIGURE 4.7: YEARLY PV INSTALLATION, MODULE PV PRODUCTION AND MODULE PRODUCTION CAPACITY 2011-2021 (GWp)
600
500
400
GW 300
200
100
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Yearly PV installations Total module PV production Total module production capacity
NOTE: REVISED BASED ON CPIA DATA AND RTS SURVEY SOURCE IEA PVPS, RTS CORPORATION
PRODUCTION CAPACITY EVOLUTION aging facilities and idle facilities that are not competitive anymore:
hence the real effective production capacity is assumed to be at
Figure 4.7 and Table 4.2 show the evolution of global annual
the level of about 380 GW/year in 2021. The speed of capacity
installed capacity, PV module production amount and PV module
enhancement is faster than the market development so the price
production capacity. In 2021, the production capacity increased
level of PV modules is expected to be stabilized if the supply for
from 327 GW/year in 2020 to 483 GW/year in 2021. It should be
polysilicon eased in the coming years.
noted that the production capacity figures include the capacities of
50
TABLE 4.2: EVOLUTION OF ACTUAL MODULE PRODUCTION AND PRODUCTION CAPACITIES (MWp)
ACTUAL PRODUCTION PRODUCTION CAPACITIES
IEA PVPS OTHER IEA PVPS OTHER

YEAR TOTAL YEAR TOTAL
COUNTRIES COUNTRIES COUNTRIES COUNTRIES
1993 52 52 80 80 65%
1994 0 0 0 0 0%
1995 56 56 100 100 56%
1996 0 0 0 0 0%
1997 100 100 200 200 50%
1998 126 126 250 250 50%
1999 169 169 350 350 48%
2000 238 238 400 400 60%
2001 319 319 525 525 61%
2002 482 482 750 750 64%
2003 667 667 950 950 70%
2004 1 160 1 160 1 600 1 600 73%
2005 1 532 1 532 2 500 2 500 61%
2006 2 068 2 068 2 900 2 900 71%
2007 3 778 200 3 978 7 200 500 7 700 52%
2008 6 600 450 7 050 11 700 1 000 12 700 56%
2009 10 511 750 11 261 18 300 2 000 20 300 55%
2010 19 700 1 700 21 400 31 500 3 300 34 800 61%
2011 34 000 2 600 36 600 48 000 4 000 52 000 70%
2012 33 787 2 700 36 487 53 000 5 000 58 000 63%
2013 37 399 2 470 39 869 55 394 5 100 60 494 66%
2014 43 799 2 166 45 965 61 993 5 266 67 259 68%
2015 58 304 4 360 62 664 87 574 6 100 93 674 67%
2016 73 864 4 196 78 060 97 960 6 900 104 860 74%
2017 97 942 7 200 105 142 144 643 10 250 154 893 68%
2018 106 270 9 703 115 973 165 939 17 905 183 844 63%
2019 123 124 17 173 140 297 190 657 28 530 219 187 64%
2020 156 430 23 044 179 474 289 581 37 095 326 676 56%
2021 213 032 29 346 242 378 410 500 71 500 482 727 50%
NOTE: ALTHOUGH CHINA JOINED IEA PVPS IN 2010, DATA ON CHINA’S PRODUCTION VOLUME SOURCE IEA PVPS & RTS CORPORATION
AND PRODUCTION CAPACITIES IN 2006 ONWARDS ARE INCLUDED IN THE STATISTICS.
51
BALANCE OF SYSTEM COMPONENT MANUFACTURERS DC string voltage. It should be noted that the global supply gap of
AND SUPPLIERS semiconductors also resulted in delays of inverter shipments or a
Balance of system (BOS) component manufacturers and suppliers reduction of production. This situation should be eased with the
represent an important part of the PV value chain. BOS components enhancement of the semiconductor manufacturing capacity in the
are accounting for an increasing portion of the system cost as the coming years.
PV module price is falling. Accordingly, the production of BOS The inverter technology has become more and more important
products has become an important sector of the overall PV industry. since it is increasingly considered as the core of the PV system,
Originally, the supply chain of PV inverters was affected by national supporting grid stability with new grid codes. New grid codes
codes and regulations so domestic or regional manufacturers require the active contribution of PV inverters to ensure grid
tended to dominate domestic or regional PV markets. However, management and grid protection, new inverters with sophisticated
with the growth of the Chinese market, the dominance of Chinese control and interactive communications features with digital
products has been visible in both utility-scale and distributed PV technologies are currently under development. With the growth of
markets. According to CPIA and other sources, the total production the self-consumption market, functions are equipped to optimize
of inverters in China was about 155 GWac, a 55% increase from self-consumption with an energy management solution combining
the previous year (100 GWac), excluding OEM production for the storage batteries and EVs with smart monitoring. Application of
companies headquartered outside of China. CPIA also reported AI and machine learning for failure detection or optimization of
that 63GWac of inverters were exported. China’s share in inverter electricity generation contributed to lowering the cost of O&M.
shipments is estimated to be around 72% in 2021, a slight year-on- In addition, inverter manufacturers entered the O&M business
year increase. and the repowering business where aging PV power plants exist,
Generally, inverters are categorized into three types: central mainly in Europe.
inverters, string inverters, and micro-inverters called “MLPE, In addition to the conventional inverters mentioned above, the
module-level power electronics”. In 2021, the share of central market of MLPE is growing in specific markets. Microinverters
inverters used for large-scale utility or industrial applications and DC optimizers (working at module level) are mainly adopted
is about 34% and the market share of string inverters used for in the US residential market due to rapid shutdown requirements
residential and small to medium-scale commercial PV systems imposed by the National Electricity Code (NEC). MLPE can help
is 64%. The share of MLPEs remains low, about 1% mainly used achieve a higher output for PV systems that are affected by
for residential and small-scale commercial applications. Recently, shading. A more efficient rapid shutdown can be realized in case
the size of inverters increased due to the pressure for LCOE of fire. Such requirements were adopted first in the USA. Thailand
reduction. The largest central inverter capacity is 5 MW and the and the Philippines also adopted them. China is also considering
maximum capacity of string inverters increased to 350 kW level. the introduction of rapid shutdown requirements, therefore,
An improvement in inverter efficiency has been observed and the market size for MLPE is expected to grow in the future.
recent products have 98% efficiency and higher. Larger-sized PV
modules using larger-sized solar cells have also driven technology Among other BOS segments, the market of single-axis trackers
improvement of inverters, as they are required to synchronize has been growing. The market size of 2021 reached around 55GW,
higher-watt peak PV modules. Inverters need to meet higher a 21% increase from 2020. The largest tracker market is the USA,
currents from PV modules, which increased from 9 A to 11 A where the majority of utility projects are built with single‑axis
to 11,5 A. In the case of PV modules using 210 mm solar cells, trackers. The market for PV trackers is expanding to China, India,
17 A of electrical current is generated. Advanced semiconductors Brazil, Mexico, Chile, Argentina, South Africa, Saudi Arabia and
(SiC or GaN) contribute to these improvements and have achieved the United Arab Emirates. In 2021, the price rise of steel was
compact designs with lighter weight, allowing 1500 V maximum reported to affect the price and delays of the shipments. Besides
utility-scale applications, trackers used for agriPV projects are
developed and commercialized with a specific design to share
solar energy with agricultural crops.
52
THE DOWNSTREAM PV SECTOR
In the PV industry, an overview of the downstream sector category) are called EPCs. EPCs include pure-players companies
can be described as in Figure 4.8 (example of utility-scale and general construction companies offering services for installing
projects). PV developers have been active in the countries PV systems. Integrated PV developers sometimes conduct at the
where power purchase agreements (PPAs) are guaranteed same time EPC, operation and maintenance (O&M) services by
under auctions, and where the Feed-in Tariff (FIT) program and themselves. Some companies develop PV power plants and own
other mechanisms are implemented. While developers sell them, while others provide EPC and own PV power plants as well
PV power plants to Independent Power Producers (IPPs) or until they sell the PV power plants to IPPs. Generally, utility-scale
investors, some developers own PV power plants as their own projects are owned by IPPs (together with equity investors), who
assets. The companies providing Engineering, Procurement and sell the power to utilities under long-term PPAs. Equity investors
Construction for PV systems (mainly utility-scale applications or other financial institutes also play an important role for the PV
but larger commercial or industrial applications also fall into this project development as equity or loan providers.
FIGURE 4.8: OVERVIEW OF DOWNSTREAM SECTOR (UTILITY PV APPLICATION)
SUPPLIERS EPC / INSTALLERS O&M IPP / DEVELOPER
PV MODULES INTEGRATED DEVELOPER / EPC TAX EQUITY INVESTOR
INVERTERS PV EPCs FINANCIAL INSTITUTE

OPERATION MONITORING
DEVELOPER
/ IPP
SUPPORT STRUCTURES / TRACKER INSTALLERS YIELD COST
OTHER BOS
SOURCE IEA PVPS & OTHERS.
Companies doing business in the downstream sector have various Oil and other major energy companies also entered into the
origins: subsidiaries of electric utilities, subsidiaries of PV module or renewable energy market. Especially, European companies are
polysilicon manufacturers, companies involved in the conventional active in this field. For example, BP (UK) is shifting to an integrated
energy or oil-related energy business. Major PV project developers oil company (IOC) to an integrated energy company (IEC).
are accelerating their overseas business deployment and are active Total (France) is focusing on gas and low carbon electricity and
in the business deployment in emerging markets such as Africa, develops PV projects globally. Shell (UK/Netherlands) announced
the Middle East, ASEAN region and Latin America. The number of to set out its strategy to accelerate its transformation into a provider
project developers active in the international business is increasing. of net-zero emissions energy products and services. In 2021,
It should be noted that several vertically integrated companies are investments in renewable energy companies, setting up JVs and
present in the downstream sector. These companies produce PV acquisition of renewable energy business of these companies were
modules or polysilicon, develop PV projects and provide EPC and frequently reported.
O&M services. c-Si PV module manufacturers such as JinkoSolar,
Canadian Solar, and Hanwha Solutions (Korea) are also active
in the downstream sector. Notable polysilicon manufacturers
investing in the international downstream business are GCL-Poly
Energy and OCI.
53
THE DOWNSTREAM PV SECTOR / CONTINUED
In the downstream sectors, business models have been changing In distributed PV systems segment for residential, commercial
with the demand for renewable electricity from users seeking to and industrial applications, the demand for self-consumption and
procure 100% renewable power for their business operations. resilience is increasing.
Especially in countries where the electricity market is liberalized,
PV electricity is sold directly to the company users by IPPs These In addition to these, obligations to install PV for new houses or
cases are called Corporate PPA (CPPA). BNEF reported that the buildings are being adopted at national and regional levels.
total volume of global CPPA signed in 2021 reached 31.1 GW These mandatory measures and tighter energy efficiency codes will
increased by 24% from 25.1 GW in 2020. According to BNEF drive the distributed PV market. In countries with an established PV
analysis, most of the projects were PV generation, and almost market, where the distributed market was established such as the
one-third of the total, 20,3 GW was contracted in the Americas. USA, Australia, Japan, Germany and other European countries,
European PV markets are also growing, and a historic record of the demand for distributed storage batteries is increasing. Subsidies
8,7 GW was contracted. As previously mentioned, because of the for storage batteries are available in some countries. PPA models
price increase of PV modules and other components, LCOE of PV are used to introduce PV systems into residential, commercial or
projects is expected to increase. However, energy prices based on industry facilities. It should be noted that the fast development of
fossil fuels are also rising, especially after the Russian invasion of EVs might change the landscape of distributed PV systems as local
Ukraine. As long as the gap exists, business cases of CPPAs are storage batteries.
expected to grow more and more in diverse locations.
PV plus storage batteries projects are announced under auctions

and other mechanisms in the USA, Australia, Europe, Africa,
Chile, India, etc. Various green hydrogen projects using PV power
were also announced in 2021. Various countries have established
hydrogen society roadmaps and have started green hydrogen
projects. Green hydrogen is expected to play an important role in
the energy transition and in R&D. Development for cost reduction
has been promoted.
54
five
SOCIETAL IMPLICATIONS OF PV
AND ACCEPTANCE
The PV sector has significant implications for the economy, ACCEPTANCE OF PV DEPLOYMENT
for the society and for the environment. The positive impacts
generated in these three areas show that PV is a main
contributor on the path towards sustainability.
Acceptance can be defined as the willingness of stakeholders to
Due to the nature of the energy transformation, the acceptance approve, support, and engage themselves in the energy revolution.
of change is an essential element of the success of this revolution: This acceptance is fuelled by a positive perception of the changes
the number of jobs involved, the creation of new companies and and decreased by negative inputs.
the disappearance or transformation of others, the impact on the
environment and the social aspects related to the development In the case of PV, in contrast to other renewable sources and
of PV are becoming essential. This chapter aims at providing key especially wind, the initial acceptance of PV was positive.
elements that can be used to promote a larger acceptance of PV Most countries started by developing small-scale PV installations,
development, while highlighting essential aspects. mostly on roofs, and until 2006-2007, the general perception of PV
was positive as its impact was marginal.
Social acceptance is becoming a key topic when it comes to PV
development in a certain number of countries around the world. The first major drawback came from the massive start in Spain
Particularly, in countries with a historically predominant distributed in 2007-2008 when the local feed-in tariff was so popular that PV
PV market, where ground-mounted PV needs to develop in order developed fast, to the extent it had to be stopped by authorities,
to achieve renewable energy targets or in countries experiencing in fear of economic and budget consequences for the country.
a market boom, the question of social acceptance is becoming All other countries that stepped into the FiT policies experienced a
central. The question of acceptance and its associated challenges major market development followed by a rapid halt. In most cases,
is not limited to ground-mounted PV systems, even if these later the reason was clear: traditional utilities felt threatened, unable to
concentrate the most resistance. jump fast into this rapidly developing business and pushed poorly
informed authorities to put the brake at PV development. While
the image of PV was positive, it soon became polluted by the
perception of extravagant profits, dramatic impact on electricity
prices or quality issues. All subjects were used massively by PV
opponents to reduce dramatically the social acceptance of PV. This
55
ACCEPTANCE OF PV DEPLOYMENT / CONTINUED
happened in Spain, France, Belgium, Czech Republic, Greece, Higher acceptance levels could be achieved by transferring value,
Bulgaria, Romania to mention a few. These are European countries part of the decision process or at least discussions to the citizens
and the EU was the epicentre of PV development until 2011-2012. and local stakeholders at large. In Spain, distributed PV with sizes
While the PV community forgot somehow the need for social below 5 MW can participate in tenders provided that they respect
acceptance, the reaction from policymakers was disproportionate certain conditions (securing local (<60 km) partners, demonstrating
and halted often almost completely the PV dynamics. In some proximity to consumption centres) aiming at increasing PV
countries like Belgium for instance, PV still suffers from a poor acceptance. In general, the target is to overcome ignorance and
image and frightens policymakers. misconception (e.g., about the land that is actually needed to meet
the targets).
Moreover, images of damage inflicted to PV systems by, for
example typhoons in Japan, but also fire outbreaks, can deteriorate Challenges related to the acceptance of PV even if they are directly
the acceptance of PV conveying the idea of poor reliability and a influenced by the political, economic, geographical, social context in
vulnerable technology. which PV installations are being deployed, are fairly similar across
different regions and countries. This calls for a higher collaboration
In the last years acceptance has gradually increased, and the between countries on this topic based on the sharing of experience
inherent competitiveness of PV contributed to increase the and exchange of good practices.
general acceptance.
INVOLVEMENT
SOCIO-POLITICAL AND COMMUNITY ACCEPTANCE
The involvement of stakeholders in the energy transformation is
It can be differentiated between national socio-political acceptance often considered as a way to ease the acceptance and accelerate
and community acceptance. These are associated with relatively the deployment. For example in countries like France, individual
different concerns and should therefore be addressed separately. self-consumption is gaining momentum these two last years,
National socio-political acceptance refers to the acceptance of indeed consumers are becoming prosumers wich improves
a technology by politicians, policy makers, key stakeholders and solar PV image. Such is the case for energy communities and
the public. It involves considerations about the legal and regulatory the Community Solar initiative in the USA, which allow the fight
framework. It resonates with concerns related to jobs, industry against poverty and energy precariourness.
and local content. In multiple countries (Turkey, Morocco, India), Such involvement can be seen under various angles:
some policy makers were putting a hold on PV development until
• Prosumers are consumers producing part or all of their electricity
it was coupled with local value creation. In France, indirect local
with PV while maintaining grid connection. Prosumers policies,
content requirement (based on an evaluation of module carbon
especially self-consumption ones are described in chapter 3.
footprints) have been introduced in tenders. Higher acceptance
levels could be achieved by demonstrating the added value of • Energy communities, and the specific case of solar communities
PV in terms of job creation, revenue generation, economy and are involving communities in producing and managing energy,
activity development, which could positively influence regions with allowing a higher involvement of stakeholders.
industrial decline for example. • Energy access is emerging countries has shown for a long time
that the implication of the populations significantly increases the
Community acceptance is related to the acceptance by local
adoption of decentralized energy sources.
stakeholders. It includes concerns over distributional justice (costs
and benefits), procedural justice, and trust; where the NIMBYism • Companies and especially utilities involved in the PV business
(Not In My Backyard) sometimes occurs. It covers consideration are known to become advocates of the energy transition.
of economic aspects: grid costs, RES fees, unequal access to
The paragraphs below highlight some key factual elements that can
PV, concentration of revenues between a limited number of big
be used to improve the perception of PV in general, on economic,
companies; social aspects (environmental, aesthetical impact),
social and environmental aspects.
and specific opposition (e.g., farmers, hunters, lobbyist …).
56
CLIMATE CHANGE MITIGATION
Climate change has become one of the key challenges that our
societies have to overcome and PV is one of the main solutions for
reducing our greenhouse gas emissions. CO2 avoided
The energy sector is responsible for a major part of the global CO2
emissions, with energy-related emissions evaluated at 33 Gt CO2eq 1 060 MT CO2,eq
in 2021.1
Increasing the PV share in the grid mix can significantly reduce Using this methodology, calculations show that the PV installed
the emissions from power generation. The global average carbon capacity today avoids up to 1060 million tonnes of CO2eq annually.
intensity of electricity was around 475 g CO2/kWh in 2019 whereas Thus, it avoids more than 3% of the energy sector emissions. This is
for 1 kWh produced by PV the emitted CO2, considered on a life essentially due to the fact that PV is being massively installed in
cycle basis, can be as low as 15 g depending on technology and countries having highly carbon intensive grid mixes, such as China
irradiation conditions (data from IEA PVPS Task 12 on sustainability and India.
and the databases made available by the groups’ researchers).
Figure 5.1 gives a view of the avoided CO2 emissions in the
The total CO2 emissions that are avoided by PV on a yearly basis first 30 countries in ranking of avoided CO2 emissions and which
can be calculated considering the amounts of electricity that can be represent in total around 98% of the global avoided emissions.
produced annually by the cumulated PV capacities installed at the end This figure displaying the countries as a function of their installed
of 2020 and considering that these amounts replace equal amounts of PV capacities and grid mix carbon intensities clearly shows their
electricity that would be generated by the respective grid mixes of the differential contribution to the global avoided emissions and the
different countries where these PV capacities are installed. The annually high impact of their respective grid mix compositions. The more
produced PV electricity is calculated based on country‑specific yields CO2 the power mix in a country emits, the more positively PV
depending on the average yields of PV installations and irradiation installations will contribute to avoiding emissions.
conditions in each country. The country-specific life cycle CO2 emission
factors (g CO2/kWh) of both PV electricity and grid mix electricity are
taken from the IEA PVPS Task 12 databases.
FIGURE 5.1: CO2 EMISSIONS AVOIDED BY PV [MT CO2,EQ]
1,6
1,4
Grid mix CO2 emission factor (MT CO2eq/TWh)
India, 121 China, 503

1,2 Poland, 4,5
South Africa, 7,9 Australia, 40 Avoided CO2 emissions
Turkey, 14,8
1,0
Greece, 4,8
Taiwan, 7,5
(MT CO2)
Netherlands, 8,5 Asia-Pacific
Thailand, 4,6 UK, 7,8
0,8 Mexico, 11 USA, 84
Malaysia, 2,1 Israel, 3,6 Korea, 25
Unitied Arab Emirates, 1,9
Vietnam, 15
Japan, 61
Europe
Pakistan, 2,7 Germany, 34
0,6 Ukraine, 3,0 Italy, 15
Hungary, 1,8
Chile, 5,5 Middle East and Africa
Egypt, 3,3 Spain, 14
0,4 The Americas
Belgium, 1,7
0,2
Brazil, 3,0
0,0
1000 10 000 100 000 1 000 000
PV cumulated installed capacity (MW)

FOOTNOTES
1 www.iea.org/reports/global-energy-review-2021/co2-emissions
57
CLIMATE CHANGE MITIGATION / CONTINUED
FIGURE 5.2A: AVOIDED CO2 EMISSIONS AS PERCENTAGE FIGURE 5.2B: AVOIDED CO2 EMISSIONS AS PERCENTAGE
OF ELECTRICITY SECTOR TOTAL EMISSIONS OF ENERGY SECTOR TOTAL EMISSIONS
18 Energy sector emissions*

16
14
12
10
%
8 33 GT CO2,eq
6
Emissions avoided
4
by PV
2 1,06 GT CO2,eq
0
a
n
ina
ey
ia
y
es
ly
a
am
re
pa
*Energy related CO2 emissions from fuel combustion

an
ali
Ind
Ita
tat
rk
Ch
Ko
Ja
str
etn
rm
Tu
dS
Au
Ge
Vi
ite
Un
VALUE FOR THE ECONOMY
The turnover of the PV sector in 2021 amounted to around

190 Billion USD. This number has been calculated based on
the size of the PV market (annual installations and cumulative Turnover PV
190 Billion USD
capacities) and the average price value for installation and
Operation & Maintenance (O&M) specific to the different market
segments and countries.
Given the variety of existing maintenance contracts and cost,

the turnover specifically linked to O&M has not been considered in
detail. However, the global turnover related to O&M was estimated
at around 8,1 Billion USD per year. This estimate can be considered
Global business value
as a lower range value, due to the assumptions made for its
calculations. It does not take into account either the material cost of
replacement and repowering, which is hardly visible, or the value
+ 19% in 2021
of recycling. O&M costs have decreased over time and a part of PV
systems are not maintained through regular contracts (especially
residential roof-top systems, unless they are monitored). The real
value of O&M is probably higher than this, above 10 Billion USD O&M
per year, if all operations could be included.
8,1 Billion USD
58
Compared to last year and in parallel to the growth of the annual The assessment of the business value of the industry is in
market, the global business value of PV installations has increased general more complex, due to the decentralized production and
by around 30% and so did the global value for O&M as well the existence of transnational companies. However, a specific
according to our estimates. This part of the PV economy is bound to approximation of the industrial business value of PV was performed
grow further, powered by aging plants and repowering operations. for IEA PVPS major PV manufacturing countries and is presented
in a specific section below.
The choice was made to assess the value of the PV sector for
the economy based on the number of installations rather than
by evaluating all the contributions of the complete value chain.
CONTRIBUTION TO THE GDP
FIGURE 5.3: BUSINESS VALUE OF THE PV MARKET IN 2021
1.0
0.9
0.8
0.7
Share of GDP (%)
0.6
0.5
0.4
0.3
0.2
0.1
0.0
E
EL
EY
EA
UM
AL
ES
EN
CE
ND
ND
AY
IL
ND
AN
AL
AR
AN
LI
IN
RI
SI
D
AI
PA
IC
RA
AN
AT
RK
UG
R
W
ED
CH
NA
LA
A
RA
AY
ST
EX
GI
CH
SP
IT
KO
NM
LA
JA
RM
RL
NL
R
ST
IS
TU
SW
RT
FR
AI
AU
CA
ST
AL
NO
BE
ER
ZE
FI
TH
GE
DE
PO
D
AU
IT
TH
E
IT
SW
NE
UN
Business value of PV installation Business value of PV Operations and Maintenance
Figure 5.3 shows the estimated business value of the PV sector in As shown by Figure 5.3, the business value of PV compared to GDP
IEA PVPS reporting countries as compared to their national GDPs. represented less than 0,4% in almost all considered countries (with
These values were determined based on the internal PV markets the exception of Chile for which this share amounts to 0,9%) and
in each country, as described above, and hence they do not take more than 0,05% in most of them, a range very similar to last year.
imports or exports into account. Some countries benefited from On a global scale, PV business value represents around 0,2% of the
exports that increased the business value they obtained through GDP compared to around 2,3% for energy investments.
the internal PV market while huge imports in other countries had
the opposite effect. However, as already mentioned, the market On a general perspective, the numbers presented as a share of
is integrated to the point that it would be extremely complex to GDP show that the investment in the energy transition, even if
assess the contribution from each part of the PV value chain. these numbers would be multiplied by a factor of 10, would stay
in a reasonable range and would not significantly change the
availability of financial resources.
59
VALUE FOR THE ECONOMY / CONTINUED
TABLE 5.1: TOP 10 RANKING OF PV BUSINESS VALUES FIGURE 5.4: CONTRIBUTION TO GLOBAL GDP OF PV
BUSINESS VALUE AND ENERGY SECTOR INVESTMENTS
RANK COUNTRY BILLION US$
1 CHINA 42
Energy investment*
2 UNITED STATES 29
3 JAPAN 8
4 GERMANY 7,3
2,29%
5 AUSTRALIA 5,5
Power sector
6 SPAIN 4,7 investment
7 FRANCE 3,9
0,96%
8 NETHERLANDS 3,7
PV business value
9 KOREA 3,5
10 CHILE 2,8
0,22%
*Investment in the power sector, fuel supply and end-use & efficiency
INDUSTRIAL VALUE OF PV FIGURE 5.5A: ABSOLUTE PV INDUSTRIAL BUSINESS

VALUE IN 2021
Even though assessing the detailed contributions of the different
parts of the whole PV value chain is hardly possible in this report due
to the level of integration of the market, an approximated evaluation
of the industrial business value of PV has been performed and the 60 000
results detailed for IEA PVPS major PV manufacturing countries.

Industrial business value of PV (Million USD)
50 000
The evaluation was made based on the production volumes and
manufacturing shares of countries for polysilicon, wafers, cells and
40 000
modules, including thin film technologies, as detailed in Chapter
4, as well as on an average estimated price for each of these four
segments. The prices take into account are based on average 30 000
prices reported by member countries. We consider that equipment

and materials are included in this computed value. BoS, including 20 000
inverters are not considered here.
10 000
The estimated global industrial value of PV established itself around
74 Billion USD in 2021 Figure 5.5 A, 5.5 B, 5.5C show for IEA PVPS
major PV manufacturing countries the estimated contribution of 0
China South Malaysia USA Europe Japan Other
each step of the value chain in the PV industrial value for each Korea
country in absolute and relative terms as well as the comparison of PolySi Wafers Cells Modules
this value to their GDP.
60
FIGURE 5.5B: PV INDUSTRIAL BUSINESS VALUE ALONG FIGURE 5.5C: PV INDUSTRIAL BUSINESS VALUE AS SHARE
THE VALUE CHAIN IN 2021 OF GDP IN 2021
0.8
55,5 BN 1,7 BN 2,9 BN 3,3 BN 4 BN 0,5 BN 6,6 BN
USD USD USD USD USD USD USD
100
0.7
90
0.6
Share of country total PV industrial value
80
Share of GDP (%)

70 0.5
60 0.4
50
0.3
40
0.2
30
20 0.1
10 0.0
China South Korea Malaysia USA Europe Japan
0
China South Korea Malaysia USA Europe Japan Other
PolySi Wafers Cells Modules
PolySi Wafers Cells Modules
China is by far the predominant manufacturing country in all steps The methodology that was used started from the data provided by
of the PV value chain, shows an approximate share of 0,3% of its reporting countries on the upstream (industrial) and downstream
GDP represented by the PV Industry (polysilicon, wafers, cells and (installation and O&M) job numbers, which were then extrapolated
modules). Remarkably, while having much lower production to other markets depending on their respective work market
volumes, the PV industry in Malaysia represents a significantly specifics. A distinction was therefore made between countries
higher share of the country’s GDP compared to China, exceeding in developed economies having a costly, low intensity work
0,7%. Korea shows an approximate 0,1% share, while remaining market and the emerging economies with an affordable work
countries do not exceed 0,03%. force. Manufacturing numbers are based on industry reports and
additional sources and split according to the same methodology.
For the BoS, the industry is significantly more distributed, When numbers differed from official job numbers, official numbers
and production occurs in many countries. It is not counted as such were always considered. Installation numbers are always
here, but such an analysis would make sense to grasp the extent an approximation.
of the PV industry impact on the countries’ economic landscape.
This report estimates that the PV sector employed an estimated
4,3 million people globally at the end of 2021. An estimated
SOCIAL IMPACTS EMPLOYMENT IN PV 1,2 million were employed in the upstream part, including materials
Figure 5.4 gives an overview of the total jobs in IEA PVPS countries and equipment, while 3,1 million were active in the downstream
and India. Reported numbers have been established based on the part, including O&M.
IEA PVPS National Survey Reports and additional sources such as
the IRENA jobs database. It should be noted that these numbers
are strongly dependent on the assumptions and field of activities
considered in the upstream and downstream sectors and represent
an estimate in the best case.
61
VALUE FOR THE ECONOMY / CONTINUED
ranking of IEA PVPS countries with about 185 000 jobs, followed by
Japan which takes fourth place with around 90 000 FTE. Generally,
PV sector employed in good correlation with the market evolutions, PV employment
an estimated expanded where the market developed: installation jobs are often
temporary ones, depending on the market dynamics.
4,3 million people Employment dynamics in the PV sector are evolving in line with
the changes in the PV markets and industry. PV labour place
in 2021 trends reflect the status of the PV industry landscape development

and how the supply chain is becoming more globalised and
geographically differentiated.
As the leading producer of PV products and the world’s largest When specifically focusing on the development and installation
installation market, China is markedly leading PV employment activities, which are more labour intensive than manufacturing,
with around 2,5 million jobs in 2021, which corresponds to a it can be observed that the average FTE intensity per installed MW
significantly higher job intensity than almost anywhere else. Lower is around 15. However, these numbers vary considerably from one
by one order of magnitude, the USA shows a total PV employment country to another and additionally from one market segment to
of about 255 000 FTE. The European Union comes third in the another. Small-scale PV generates more jobs than utility-scale PV
in general.
FIGURE 5.6: GLOBAL EMPLOYMENT IN PV PER COUNTRY
2,5
0,25
0,2
Million jobs
0,15
0,10
0.05
0
EL
AL
A
IA
DA
CA
A
ND
ND
D
O
CO
)
ES
DS
N
PO EN
LE
CE
SW K
Y
LY
AY
U
IN
SI
RE
RI
AN
IC
AR
AN
KE
PA
AI
AL
RA
IU
(E
UG
RI
I
AT
NA
AN
OC
AN
LA
ED
AY
CH
RW
ST
EX
CH
SP
KO
IT
LG
R
RL
NL
AF
NM
JA
RM
IS
RT
ST
AI
OR
AU
TU
CA
ST
FR
AL
RL
M
NO
BE
ZE
FI
TH
DE
GE
AU
ED
E
M
UT
IT
TH
IT
SW
SO
NE
UN
62
O&M generates many manual jobs while the entire PV value chain to be done to explain carefully the advantages of PV in reducing
creates good quality jobs, from research centres to manufacturing. the energy cost of end-consumers, even those without PV plants,
In summary, the upstream part generates around 5 FTE per MW and counter the false statements that reduce the confidence of the
produced while the downstream part generates around 15 FTE per population in the energy transformation.
MW installed.
With an estimated total of 4,3 million jobs in the solar PV sector PV FOR SOCIAL POLICIES
worldwide in 2021, PV employs around one third of the total
renewable energy workforce and remains number one in the Besides its direct value for the economy and the jobs that it creates,
employment ranking of the global renewable energy sector. both making contribution to the prosperity of the countries in which
it is being installed and produced, PV entails additional positive
implications on the social level if leveraged with appropriate
LOCAL MANUFACTURING policies. Several examples can be highlighted.
The emergence of PV as a mainstream technology woke up As shown through the off-grid PV market development in Africa
appetites for local manufacturing and job creation at all levels of and Asia (see Chapter 2), PV can be a competitive alternative to
the value chain. Looking at IEA PVPS member countries only, increase energy access in remote rural areas not connected to
several countries have pushed through different schemes for power grids. Improved energy access can benefit rural business
local manufacturing in recent years, namely Canada, France, performance, free up workers’ time, provide more studying hours
Morocco, Turkey and the USA. Other countries have succeeded for children, improve health through cleaner cooking, and create
in bringing many manufacturers to produce PV components in their or enhance jobs as a result. Electrification is a key factor to reduce
country, such as Malaysia, which is the most successful example poverty and increase education, with a direct impact on women’s
to date. Others, such as Chile and South Africa, are eyeing and children’s life standards in many regions in the world. In that
possibilities. With the disruptions in the PV value chain caused by respect, PV would deserve a significant attention for electrification.
the pandemics and the increases cost of shipment, the question of
local manufacturing has gained traction in 2021 and 2022. While In China, since the end of 2015, 100% electrification of the country
local production requires investments, skills and, ideally a stable has been reached. So, there are no government supported projects
local market, this perspective is facing a significantly higher interest for off-grid rural electrification anymore since 2016. However,
from policymakers. Countries such as India or Saudi Arabia, a massive program for poverty alleviation leaning on PV was
to name a few, are pushing hard to develop a local industry and launched. It aimed to enhance the life standards of around 2 million
increase their partial independence. households, especially in the most impoverished parts of eastern
China by installing around 5 kW of PV per household. This policy
was halted in 2021.
IMPACT ON ELECTRICITY BILLS
In Malaysia, rural electrification is still a priority of the
While many focused for years on the increase of electricity bills due government, with a projected 100% electrification rate by 2025.
to the incentives that were spent to develop PV (see chapter 3), Rural electrification is done together with utilities as a form of
few mention the merit-order effect. Numerous studies in various public‑private partnership. In remote Sarawak, the Sarawak
countries have shown that PV reduces wholesale market prices for Alternative Rural Electrification Scheme (SARES) has electrified
electricity at the time of production. In some cases, negative prices almost 5 000 households in 192 villages since its launch in
have been seen at times of high PV penetration, even if this isn’t the 2016 and has received regional recognition in 2019. Solar PV
sole cause. The savings for electricity consumers and the society, and hybrid systems are often used in this scheme, as well as
in general, is difficult to compute but most studies conclude on micro hydro‑technologies.
significant savings and additionally, cost decrease in the distribution
grid up to a certain penetration of PV. The argument that PV (and In Korea, in Seoul, with the financial aid from Seoul Metropolitan
wind) might require additional gas peakers or coal‑fired power government, a non-profit organization, Energy Peace Foundation,
plants is a wrong understanding of the dynamics of the balance and Solar Terrace company installed 30 kW mini-PV systems for
between supply and demand of electricity. However, much remains 100 energy-vulnerable households (300 W/household). This type
of mini-PV installations is becoming popular in Korea to reduce the
electricity bill burden during the summer.
63
VALUE FOR THE ECONOMY / CONTINUED AESTHETICS AND LANDSCAPE
In Italy, the Municipality of Porto Torres (Sardinia Region), with the As the large-scale integration of photovoltaics into our energy
collaboration of the energy services operator, introduced in 2017 an system is necessary for achieving the energy transition, large areas
energy income project. The municipality allocated public resources of photovoltaic modules will become part of our landscapes. Very
to purchase PV systems, sold on loan to families in energy poverty often landscape preservation issues are already a barrier to the
conditions, to make them benefit from PV self-consumption and implementation of the large-scale implementation of photovoltaics,
thus reduce their energy bills. The revenues of the net-billing feed as the social acceptance of such landscape transformation is in
a public fund, in order to finance the maintenance of the plants or general low. In order to support the diffusion of photovoltaics this
possibly the purchase of other plants for other families. After this condition requires a paradigm shift to an enlarged design vision
project, some other municipalities and/or some Regions are that includes not only technical, engineering considerations,
planning and carrying out similar initiatives. but also landscape design ones.
In Australia, a number of measures were announced by State Building a bridge between the large-scale deployment of
Governments in 2020 and have been maintained in 2021 going photovoltaics and the landscape design, paving the way to the
from interest free loans to rebates (subsidy of up to 50% of the design of sustainable, beautiful photovoltaic landscapes is not
total cost) or even complete subsidies (Solar for Low Income optionable anymore. Integrated photovoltaic solutions have a big
Households for systems with an installed capacity up to 3 kW). potential in terms of penetration of photovoltaics, as in general
Additional measures tackling rural electrification include a budget integration is a tool for diffusing new technologies into conservative
to support feasibility studies looking at microgrid technologies to environments. Among the existing integrated solutions, the so
replace, upgrade or supplement existing electricity supply and to called “agrivoltaics” offer a solution to addressing concerns about
finance the deployment of PV to reduce the use of diesel. energy vs. agricultural land use, as they maximize the land use by
generating both energy and food simultaneously. At the same time
In France, rural electrification is addressed in overseas territories these systems offer a possibility for experimenting with a varied set
and isolated alpine areas through budgets available for off-grid of solutions, which can be adapted to different landscape features.
electricity production (1 M EUR budget in 2021), electric vehicle
charging points or grid-connection financing.
In general, the low cost of PV electricity could reach more

households to alleviate poverty, both in developed and developing
countries. It offers opportunities for social programs, and especially
to fight energy poverty, which has not been widely used yet.
While the reputation of PV, especially in the European countries
that started to fund its development, is one of a costly energy
source, increasing electricity prices, the reality of PV in 2021 is that
it represents a tremendous opportunity to reduce energy prices for
the poorest citizens, as well as to reduce energy costs for social
housing, public buildings, from schools to retirement homes, and
increase the access to electricity for everyone. The energy crisis of
2022 has increased the competitiveness of PV to the extent that it
could reduce the electricity bill of families and companies, with or
without a suitable roof, using smartly the possibilities offered by
delocalized (or virtual) self-consumption.
64
IEA PVPS TRENDS IN PHOTOVOLTAIC APPLICATIONS 2022 Photo by Werner Slocum, NREL 65320
six
COMPETITIVENESS OF PV
ELECTRICITY IN 2021
The rapid price decline that PV experienced in the last years In addition, the choice of alternatives to coal is frequently not
has already opened possibilities to develop PV systems in many motivated by pure economics but is biased towards an electricity
locations with limited or no financial incentives. However, the price and market design that favour gas-fuelled electricity. Since all
road to full competitiveness of PV systems with conventional sources of electricity have benefited at some point from such
electricity sources depends on answering many questions support, the question of the competitiveness of PV should be
and bringing innovative financial solutions, especially to considered carefully. Hereunder, we will look at the key elements
emerging challenges. driving the competitiveness of PV solutions.
This section aims at defining where PV stands regarding its own

competitiveness, starting with a survey of module and system
prices in several IEA PVPS reporting countries. Given the number MODULE PRICES
of parameters involved in competitiveness simulations, this
chapter will mostly highlight the comparative situation in key
countries. Prices are often averaged and should always be looked The very first period of PV market development can be considered
at as segment related. starting from the first prototypes to small scale production leading
The question of competitiveness should always be contemplated to a total PV installed capacity of around 2 GW. During this first
in the context of a market environment created for conventional phase, prices reductions corresponding to a learning rate of 18%
technologies and sometimes distorted by historical or existing were achieved: this allowed the total PV installed capacity to
incentives. The fast development of nuclear in some countries in continue growing further. At that point, prices stabilized until the
the last 40 years is a perfect example of policy-driven investments, total capacity reached around 10 GW: this period is known as the
where governments imposed the way to go, rather than letting the time of low availability of polysilicon that maintained prices at a
market decide. The oil and gas markets are also perfect examples high level. Then, a third period started which is still the case today,
of policy-driven energies which are deemed too important not to beginning with the mass production of PV, especially in China.
be controlled. PV competitiveness should therefore be considered During this period ranging from 10 GW to current levels, significant
in this same respect, rather than the simple idea that it should be economies of scale led to an impressive 41% learning rate over the
considered competitiveness without any regulatory or financial last decade. Figure 6.2 illustrates the prices range for PV modules:
support. There are also further barriers, other than economic, it shows that prices globally stabilized in 2020 and increased slightly
for PV to become the obvious alternative to coal (rather than gas) in 2021 under the impact of conjunctural effect as a consequence
for utilities. Currently, many already unprofitable coal power plants of Covid 19.
are still in operation because the regulatory and financial structure
is not tailored for so many coal units to become stranded assets.
65
MODULE PRICES / CONTINUED
FIGURE 6.1: PV MDOULES SPOT PRICES LEARNING CURVE (1992-2021)
100,0
LR = 21%
100,0
Module spot price (USD/W)
Small scale production Polysilicon Mass production Supply chain

LR = 18% shortage LR = 41% disruption
10,0
1,0
0,1
0 0.1 1 10 100 1 000
Total PV installed capacity (GW)
SOURCE IEA PVPS & BECQUEREL INSTITUTE
FIGURE 6.2: EVOLUTION OF PV MODULES PRICES RANGE IN USD/W
4
Price of PV modules (USD/W)
0
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
66
On average, the price of PV modules in 2021 (shown in Figure 6.2) Prices below 0,25 USD/W can hardly generate benefits and it is
accounted for approximately between 40% and 50% of the lowest generally admitted that most companies are not selling a large
achievable prices that have been reported for utility scale systems. part of their production at these low levels. It is also clear that
In 2021, the lowest price of modules in the reporting countries such prices can be considered below the average production
was slightly above 0,30 USD/W, a significant increase compared costs of many companies, even if production costs are declining
to one year before, due to disruption in the global supply chain. as well. Looking in depth at the revenues of some manufacturers
It is assumed that such prices are valid for high volumes and late among the most competitive, it appears that average sales are
delivery (not for installations in 2021). However, module prices for above these low prices. It can also be assumed that such prices
utility-scale plants have been reported below the average values, are obtained with new production lines in which production costs
anyway up to around 0,25 USD/W at the end of 2021. are significantly lower than previously existing ones. It can also
be assumed that the most competitive thin film technologies can
The Chinese decision in May 2018 led to a new imbalance between outperform traditional crystalline silicon ones. The decrease in
production and demand, with dozens of GW of new production polysilicon and wafer costs also led to some PV modules’ price
capacities added in 2017 and 2018 in all segments of the value decreases without cost improvements at cells and modules levels.
chain while the global PV market was stagnating. The price
decrease that followed accelerated some project development Higher module prices are still observed depending on the market.
and can be considered at least partially responsible for the market For instance, the prices in Japan are consistently higher than in
growth in 2020. The year 2021 has seen the rise of multiple raw Germany and the United States, while average selling prices were
material prices. In particular, PV polysilicon average spot prices in general still in the 0,4 USD/W range for most producers.
significantly during the year, up from around 10 USD/kg in early
2021. Other key raw materials such as PV glass, copper or
aluminium maintained their high prices reached at the end of 2020.
In addition, the whole PV value chain suffered from the important
increase in transport costs.
FIGURE 6.3: INDICATIVE MODULE PRICES IN REPORTING COUNTRIES
0.8
0.7
0.6
Annual PV market 2021 [GW]
0.5
55 GW
USD/W
0.4
0.3 5 GW
0.2
0.5 GW
0.1
0.0
67
SYSTEM PRICES
Reported prices for PV systems vary widely and depend on a for such installations also depend on higher costs for the transport
variety of factors including system size, location, customer type, of components, and technicians, without even mentioning the
connection to an electricity grid, technical specifications, and the higher costs of maintenance. In 2021, the lowest system prices in
extent to which end-user prices reflect the real costs of all the the off‑grid sector, irrespective of the type of application, typically
components. For more detailed information, the reader is directed ranged from about 2 USD/W to 6 USD/W but prices for some
to each country’s national survey report on the IEA PVPS website specific applications can be higher. The large range of reported
(www.iea-pvps.org/national-survey-reports). prices in Figure 6.5 is a function of the country and project-specific
factors. The highest prices haven’t been included in the figures
Figure 6.4 shows the range of system prices in the global PV market given the very low level of installations: in general, off-grid prices
in 2021. It shows that around 65% of the PV market consists of prices have been averaged in the figures for readability reasons.
below 1 USD/W. Large distributed PV systems start around 0,75
USD/W while utility-scale PV saw prices as low as 0,55 USD/W. BIPV In 2021, an increased number of floating PV projects have been
can be seen as a series of segments where the prices can significantly realized, in particular in Southeast Asia and Europe. Nevertheless,
diverge. Off-grid applications suffer from a similar situation, with floating PV would require some further developments to identify
totally different cases illustrated at different prices. In general, the real-life prices.
price range decreased from the previous year for all applications.
Additional information about the systems and prices reported
On average, system prices for the lowest-priced off-grid for most countries can be found in the various National Survey
applications are significantly higher than for the lowest-priced Reports; excluding VAT. More expensive grid-connected system
grid‑connected applications. This is mainly attributable to the prices are often associated with roof-integrated slates, tiles,
relatively higher transport costs to access the sites. Indeed, large- building integrated designs or single projects: BIPV systems in
scale off-grid systems are often installed in places far from the grid general are considered more expensive when using dedicated
but also far from major towns and highways. Higher prices asked components, even if prices are also showing some decline.
FIGURE 6.4: 2021 PV MARKET COSTS RANGES
10
6
USD/W
0
0
10 000
20 000
30 000
40 000
50 000
60 000
70 000
80 000
90 000
100 000
110 000
120 000
130 000
140 000
150 000
160 000
170 000
Installed capacity in MW
Distributed PV on Rooftops Utility-scale PV Ground-mounted Off-Grid PV Distributed PV as Building Integrated Floating PV
Residential PV systems price ranged from 1,8 USD/W to 3 USD/W in 2021 while utility-scale PV systems prices ranged from 0,35 USD/W
to 2,1 USD/W in 2021 according to the data collected.
68
FIGURE 6.5: EVOLUTION OF RESIDENTIAL AND GROUND-MOUNTED SYSTEMS PRICE RANGE 2012 - 2021 (USD/W)
5,0
4,5
4,0
3,5
Price of PV systems
3,0
(USD/W)
2,5
2,0
1,5
1,0
0,5
0,0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Typical range for residential systems Typical range for ground mounted systems
Low range residential systems Low range ground mounted systems
FIGURE 6.6: INDICATIVE INSTALLED SYSTEM PRICES IN SELECTED IEA PVPS REPORTING COUNTRIES IN 2021
4.0
3.5
3.0
Annual PV market 2021 [GW]
2.5
20 GW
USD/W
2.0
1.5
2 GW
1.0
0.2 GW
0.5
0.0
Off-grid Distributed- Distributed- Distributed- Centralized

Residential Commercial Industrial
69
SYSTEM PRICES / CONTINUED
The lowest achievable installed price of grid-connected systems GRID PARITY

in 2021 also varied between countries as shown in Figure 6.6.
Grid Parity (or Socket Parity) refers to the moment when PV can
The average price of these systems is tied to the segment. Large
produce electricity (the Levelized Cost of Electricity or LCOE) at a
grid-connected installations can have either lower system prices
price below the price of electricity consumed from the grid. While
depending on the economies of scale achieved, or higher system
this is valid for pure players (the so-called “gridprice” refers to the
prices where the nature of the building integration and installation,
price of electricity on the market), this is based on two assumptions
degree of innovation, learning costs in project management and
for prosumers (producers who are also consumers of electricity):
the price of custom-made modules may be considered as quite
significant factors. In summary, system prices increased in 2021, • That PV electricity can be consumed locally (either in real‑time
following the trends of module prices and the balance of the or through some compensation scheme such as local or
system while soft costs and margins remained stable. Yet, system delocalized net metering);
prices below 0,6 USD/W for large-scale PV systems were common • That all the components of the retail price of electricity can
in very competitive tenders, and some report prices down to be compensated when it has been produced by PV and
0,35 USD/Wp in India. The previously observed trend of price locally consumed.
ranges tending to converge, with the lowest prices decreasing at
a reduced rate while the highest prices are reducing faster was Technical solutions will allow for increases in the self-consumption
broken in 2021. Finally, the question of the lowest CAPEX is not level (demand-side management including EV charging or direct
always representative of the lowest LCOE: the case of utility-scale use to heat water with heat pumps, local electricity storage,
PV with trackers illustrates this, with additional CAPEX translating reduction of the PV system size, delocalized self-consumption,
into a significantly higher LCOE. Bifacial costs are not visible in energy communities, etc.).
a system cost figure. If only a part of the electricity produced can be self-consumed,
then the remaining part must be injected into the grid and
should generate revenues of the same order as any centralized
COST OF PV ELECTRICITY production of electricity. Today this is often guaranteed for small
size installations by the possibility of receiving a FiT (or similar)
for the injected electricity. Nevertheless, if we consider how PV
could become competitive, this will imply defining a way to price
In order to compete in the electricity sector, PV technologies this electricity so that smaller producers will receive fair revenues.
need to provide electricity at a cost equal to or below the cost
of other technologies. Obviously, power generation technologies The second assumption implies that the full retail price of electricity
are providing electricity at different costs, depending on their could be compensated. The price paid by electricity consumers is
nature, the cost of fuel, the cost of maintenance and the number of composed in general of four main components:
operating hours during which they are delivering electricity. • The procurement price of electricity on electricity markets plus
the margins of the reseller;
The competitiveness of PV can be defined simply as the moment
when, in a given situation, PV can produce electricity at a cheaper • Grid costs and fees, partially linked to the consumption, partially
price than other sources of electricity that could have delivered fixed; the key challenge is their future evolution;
electricity at the same time. Therefore, the competitiveness of a • Taxes;
PV system is linked to the location, the technology, the cost of
• Levies (used among other things to finance the incentives
capital, and the cost of the PV system itself which highly depends
for some renewable sources, social programmes,
on the nature of the installation and its size. However, it will also
solidarity between regions etc.);
depend on the environment in which the system will operate.
Off‑grid applications in competition with diesel-based generation
will not be competitive at the same moment as a large utility-scale
PV installation competing with the wholesale prices on electricity
markets. The competitiveness of PV is connected to the type of PV
system and its environment.
70
If the electricity procurement price can be compensated, the two taxes as well, the one on grid financing is more complex. Even if
other components require considering the system impact of such self‑consumed electricity could be fully compensated, alternative
a measure; with tax loss on one side and the lack of financing of ways to finance the grid should be considered given the loss of
distribution and transmission grids on the other. While the debate revenues for grid operators or a better understanding of PV
on taxes can be simple, since PV installations are generating positive impacts on the grid should be achieved.
FIGURE 6.7: LCOE OF PV ELECTRICITY AS A FUNCTION OF SOLAR IRRADIANCE & RETAIL PRICES IN KEY MARKETS*
550 SWEDEN
500
450
DENMARK
Price of Electricity in USD/MWh
400
GERMANY
BELGIUM
SPAIN
350
AUSTRALIA
AUSTRIA
300 FRANCE JAPAN
NORWAY PORTUGAL
250 SWITZERLAND ITALY
FINLAND
200
NETHERLANDS
USA
150 CHINA
TURKEY
100
50
0
800 900 1000 1100 1200 1300 1400 1500 1600 1700 1800
YIELD kWh/kW/year
LCOE at 2 USD/Wp LCOE at 1 USD/Wp LCOE at 0,5 USD/Wp
*NOTE: THE COUNTRY YIELD (SOLAR IRRDIANCE) HERE SHOWN MUST BE CONSIDERED AS AN AVERAGE SOURCE IEA PVPS & OTHERS
THE LOWEST ELECTRICITY PRICES (RESPECTIVELY THE HIGHEST) DISPLAYED PER COUNTRY SHOULD BE SEEN
AS AN AVERAGE VALUE FOR INDUSTRIAL CONSUMERS (RESPECTIVELY RESIDENTIAL CONSUMERS).
Figure 6.7 shows how grid parity has already been reached in The specific case of BIPV consists, for new or renovated roofs,
several countries and how declining electricity costs are paving to assess the competitiveness for the BIPV solution minus the
the way for more countries becoming competitive for PV. costs of the traditional roofing (or façade) elements. The rest of the
In 2021, rising retail electricity prices have further strengthened assessment is similar to any building under self-consumption using
the competitiveness of PV in a number of countries. The figure a standard BAPV solution. Of course, if the BIPV solution has to be
shows the range of retail prices in selected countries based on their installed on a building outside of any planned works, this doesn’t
average solar resource and the indicative PV electricity threshold apply. Metrics used for buildings can also be different, since the
for three different system prices (0,5, 1 and 2 USD/W, converted integration of PV components might be justified by non-economic
into LCOE). Green dots are cases where PV is competitive in most factors or the perspective of an added value. For such reasons,
of the cases. Blue dots show where it really depends on the system BIPV competitiveness is in general assessed against the traditional
prices and the retail prices of electricity. building costs.
71
COST OF PV ELECTRICITY / CONTINUED
COMPETITIVENESS OF PV ELECTRICITY WITH FUEL-PARITY AND OFF-GRID SYSTEMS

WHOLESALE ELECTRICITY PRICES
Off-grid systems including hybrid PV/diesel can be considered
In countries with an electricity market, wholesale electricity prices competitive when PV can provide electricity at a cheaper cost
when PV produces are one benchmark of PV competitiveness. than the conventional generator. For some off-grid applications,
These prices depend on the market organisation and the technology the cost of the battery bank and the charge controller should be
mix used to generate electricity. In order to be competitive with considered in the upfront and maintenance costs while a hybrid
these prices, PV electricity has to be generated at the lowest system will consider the cost of fuel saved by the PV system.
possible price. This is already achieved with large utility-scale PV
installations that allow reaching the lowest system prices today The point at which PV competitiveness will be reached for
with low maintenance costs and a low cost of capital. Plants have these hybrid systems takes into account fuel savings due to the
been commissioned in recent years in Spain, Germany or Chile reduction of operating hours of the generator. Fuel-parity refers to
which rely only on remuneration from electricity markets. It is the moment in time when the installation of a PV system can be
highly probable that energy-only markets will be completed by grid financed with fuel savings only. It is assumed that PV has reached
services and similar additional revenues. However, such plants fuel-parity, based on fuel prices, in numerous Sunbelt countries.
are already viable and calculations show that most of western
Other off-grid systems are often not replacing existing generation
European countries for instance, from Portugal to Finland, would
sources but providing electricity in places with no network and no
be suitable for such PV plants with 2020 electricity prices. Under
or little use of diesel generators. They represent a completely new
rising electricity prices, such business models have allowed to take
way to provide electricity to hundreds of millions of people all over
full advantage of the short-term conjunctural favourable situation
the world.
and this in spite of the PV systems price increase observed in 2021.
Such business models remain however riskier than conventional
ones that guarantee prices paid to the producer over 15 years or PRODUCING COMPETITIVE GREEN HYDROGEN WITH PV
more. The key risk associated with such business models lies in
the evolution of wholesale market prices on the long term: it is The declining cost of PV electricity opens the door for other
known that PV reduces prices during the midday peak when applications and especially the possible production of “green”
penetration becomes significant. It has also been shown in recent hydrogen directly from PV (possibly in combination with wind).
years that such influence on prices still has a marginal impact on While the business model behind is being explored, in particular in
prices during the entire year. With high penetration and the shift to Australia, Chile, China, France, Japan, Korea, Portugal and Spain,
electricity of transport and heating, the influence of PV electricity the cost of PV electricity should reach lower levels, while the cost
on the market price is not yet precisely known and could represent of electrolysers should decrease as well to make green hydrogen
(or not) an issue in the medium to long term: either prices during competitive. This perspective is not so far away, and some start
PV production will stay down and impair the ability to remunerate to envisage a possible competitiveness in the coming years for
the investment or low prices will attract additional demand and specific uses of hydrogen. While the competitiveness with “black”
will stabilise the market prices. At this point, both options remain hydrogen seems still unreachable for the time being, other uses
possible without possibilities to identify which one will develop. in transport, some industrial applications and possibly agriculture
When a wholesale market doesn’t exist as such, (in China for (through ammonia), might create a tremendous opportunity for PV
instance), the comparison point is the production cost of electricity to produce hydrogen without being connected to the grid. Such a
from coal-fired power plants. development would increase possibly the PV market significantly
outside of the constraints it experiences for the time being.
72
RECORD LOW TENDERS
FIGURE 6.8.A: NORMALISED LCOE FOR SOLAR PV BASED ON LOWEST* PPA PRICES 2016 - Q4 2021
100
MEXICO
90
INDIA
80
70
UNITED ARAB EMIRATES INDIA
USD/MWh
60 INDIA
BRAZIL
50
40
30 PORTUGAL
QATAR PORTUGAL
MEXICO CHILE
SAUDI ARABIA
20
10
0
H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2
2016 2016 2017 2017 2018 2018 2019 2019 2020 2020 2021 2021
Original Tenders With Yield = 1 000 kWh/kWp With Yield = 2 000 kWh/kWp
* BASED ON LOWEST PPA PRICES PER SEMESTER SOURCE IEA PVPS & OTHERS
FIGURE 6.8.B: NORMALISED LCOE FOR SOLAR PV BASED ON RECENT PPA PRICES 2021
300
MALTA
250
200
USD/MWh
150
KOREA
FRANCE
100
RUSSIA FRANCE
INDIA
MALAYSIA GREECE GERMANY HUNGARY
INDIA INDIA POLAND
50 BELGIUM
TURKEY ARMENIA
SPAIN SAUDI ARABIA CHILE
UZBEKISTAN
0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2021 2021 2021 2021 2021 2021 2021 2021 2021 2021 2021 2021
Original Tenders With Yield = 1 000 kWh/kWp With Yield = 2 000 kWh/kWp
73
COST OF PV ELECTRICITY / CONTINUED
With several countries having adopted tenders as a way to The question of competitiveness with wholesale market prices
allocate PPAs to PV projects, the value of these PPAs achieved (in countries where such market for electricity exists), depends
record low levels in 2020 and some low prices were again reached highly on the average market prices seen. In Europe, 2022 has
in 2021. These levels are sufficiently low to be mentioned since experienced such an insane market price increase (up to 1 000%
they approach, or in many cases beat, the price of wholesale increase compared to early 2021) that PV prices variations have no
electricity in several countries. While these tenders do not impact at all on the competitiveness of PV: while the LCOE of PV
represent the majority of PV projects, they have shown the ability can be estimated for utility-scale plants in Europe between 20 and
of PV technology to provide extremely cheap electricity under the 60 EUR/MWh, market prices ranging from 200 to 650 EUR/MWh
condition of a low system price. (below 0,5 USD/W) and a low have been seen in numerous countries (spot price). While these
cost of capital. prices are highly influenced by the 2022 high gas prices resulting
from the war in Ukraine and the sanctions against Russia, they
constitute anyway a record level that makes PV competitive in
all cases.
TABLE 6.1: TOP 10 LOWEST WINNING BIDS IN PV TENDERS TABLE 6.2: LOWEST WINNING BIDS IN PV TENDERS FOR
FOR UTILTY SCALE PV SYSTEM UTILTY SCALE PV SYSTEM PER REGION
REGION COUNTRY/STATE USD/MWH YEAR REGION COUNTRY/STATE USD/MWH YEAR
MIDDLE EAST SAUDI ARABIA 10,4 2021 ASIA UZBEKISTAN 17,9 2021
EUROPE PORTUGAL 13,2 2020 AFRICA TUNISIA 24,4 2019
LATIN AMERICA CHILE 13,3 2021 EUROPE PORTUGAL 13,2 2020
MIDDLE EAST UNITED ARAB EMIRATES 13,5 2020 LATIN AMERICA CHILE 13,3 2021
MIDDLE EAST QATAR 14,5 2020 MIDDLE EAST SAUDI ARABIA 10,4 2021
MIDDLE EAST SAUDI ARABIA 14,8 2021 NORTH AMERICA MEXICO 20,6 2017
EUROPE SPAIN 15,0 2021 SOURCE IEA PVPS & OTHERS
EUROPE PORTUGAL 17,5 2019
LATIN AMERICA BRAZIL 17,5 2019
ASIA UZBEKISTAN 17,9 2021
74
seven
PV IN THE ENERGY SECTOR
PV ELECTRICITY PRODUCTION
TRACKING OF PV INSTALLED CAPACITY AND MONITORING DECOMMISSIONING

OF PV PRODUCTION
As an increasing share of the global installed PV capacity is attaining
Tracking PV installations in all the regions of the world can be a certain lifetime - with the very first waves of installations dating
challenging as many countries do not accurately keep track of the back to the nineties - decommissioning must be considered to
PV systems installed or do not make the data publicly available. estimate the PV capacity. However, the effect might still be limited
at the global scale as less than 0,1% of the cumulative capacity has
Furthermore, PV electricity production is easy to measure at been installed before the year 2000 and only 6% before the year
a power plant but much more complicated to compile for an entire 2010. Furthermore, when available, official numbers should take
country. First, the installed capacity must be accurately tracked, decommissioning into account, which is the case for most IEA PVPS
which requires an effective and consistent approach, especially countries. In that respect, off-grid numbers in several countries
for distributed and off-grid segments. Second, the electricity have decreased due to decommissioning. Recycling numbers are
production cannot accurately be derived from the installed PV underestimating decommissioning due to a vivid (and sometimes
capacity at a certain point in time. Indeed, a system installed at barely legal) second-hand market, especially towards Africa.
the end of the year will have produced only a small fraction of
its theoretical annual electricity output. For these reasons, the
electricity production from PV per country in this report is an
estimate that we will call “average theoretical production”.
To calculate the average theoretical PV production, the average

solar yield in the country is used. The number has been provided
through National Survey Reports, as well as additional sources and
is an approximation of the reality. As a reminder, PV production
cannot be calculated based on the AC value but requires the DC
value and the characteristics of the PV plant.
75
PV ELECTRICITY PRODUCTION / CONTINUED
PV PERFORMANCE LOSSES PV PENETRATION

The calculation of the evolution of a PV system performance PV electricity penetration is the ratio between PV electricity
is crucial to provide more accurate values to be used in yield production in a country and the electricity demand in that country
assessments not only in terms of absolute value. In order to be able and is expressed as a percentage. Electricity demand is obtained
to judge a system performance, the performance loss (PL) must be via publicly available databases and via the IEA PVPS experts.
calculated. The calculation of PL in PV systems is not trivial as the
“true” value remains unknown. Several methodologies have been Many other countries have lower production numbers, but in total
proposed, however there is no consensus and thus a standardized 36 countries produced at least 1% of their electricity demand from
approach to the calculation. The combination of temperature PV in 2021.
corrected PR with the use of Year on Year or STL performs very Real figures might be lower since some installations didn’t produce
well compared to others. electricity during the entire year, but also since some plants might
Within the IEA PVPS Task 13, a group of experts representing have experienced production issues, due to technical problems or
several leading R&D centers, universities and industry companies, external constraints (e.g., in France, PV penetration as reported
is developing a framework for the calculation of Performance Loss by RTE (French TSO) lies around 3%). The real PV production in
Rates (PLR) on a large number of commercial and research PV a country is difficult to assess, especially when self-consumption
power plants and related weather data coming from various climatic and storage enter into consideration. IEA PVPS advocates for
zones. Various methodologies are applied for the calculation of PLR, governments and energy stakeholders, including grid operators to
which are benchmarked in terms of uncertainties and “true” values. create accurate databases and measure precisely PV production.
The aim of the international collaboration is to show how to calculate Concerning global PV penetration, with around 946 GW installed
the PLR on high quality data (high time resolution, reliable data, worldwide, PV could produce almost 1 229 TWh (see Table 7.1)
irradiance, yield, etc.) and on low quality data (low time resolution, of electricity on a yearly basis. This represents around 5% of the
only energy data available). Various algorithms and models, along global electricity demand covered by PV as presented in figure 7.1.
with different time averaging and filtering criteria, can be applied Performance losses due to aging of PV plants are not considered
for the PLR calculation, each of which can have an impact on the at this point.
results. The approach considers three pathways to ensure broad
collaboration and increase the statistical relevance of the study
and the combination of metrics (PR or power based). Furthermore,
methodologies are benchmarked in terms of deviation from the
average value and in terms of standard deviation.
76
TABLE 7,1: 2021 PV ELECTRICITY STATISTICS IN IEA PVPS COUNTRIES
COUNTRY FINAL HABITANTS GDP SURFACE AVERAGE PV PV PV ANNUAL CUMULATIVE CUMULATIVE THEORETICAL
ELECTRICITY 2021 2021 YIELD CUMULAIVE ANNUAL ELECTRICITY CAPACITY CAPACITY CAPACITY PV
CONSUMPTION INSTALLED INSTALLED PRODUCTION PER PER PER KM2 PENETRATION
2021 CAPACITY CAPACITY CAPITA CAPITA
2021 2021
KWH/
TWH MILLION BUSD KM2 MW MW TWH W/CAP W/CAP KW/KM2 %
KWP
AUSTRALIA 267 26 1 543 7 690 000 1 400 26 035 4 944 36 192 1 011 3 13,6%
AUSTRIA 66 9 477 84 000 1 050 2 783 739 3 83 313 33 4,4%
BELGIUM 82 11 600 33 688 925 7 123 850 7 74 620 211 8,0%
CANADA 562 38 1 991 9 985 000 1 150 4 135 421 5 11 109 0 0,8%
CHILE 79 19 317 756 096 1 699 6 165 2 681 10 140 321 8 13,3%
CHINA 7 714 1 400 17 734 9 634 000 1 300 308 520 54 880 401 39 220 32 5,2%
DENMARK 37 6 397 44 000 975 2 344 718 2 122 399 53 6,2%
FINLAND 81 6 299 390 908 875 413 100 0 18 75 1 0,4%
FRANCE 441 67 2 937 543 965 1 180 16 450 3 350 19 50 245 30 4,4%
GERMANY 503 83 4 223 357 170 978 59 661 5 760 58 69 718 167 11,6%
ISRAEL 68 9 482 20 770 1 750 3 349 935 6 101 360 161 8,6%
ITALY 318 59 2 100 301 336 1 137 22 594 944 26 16 374 75 8,1%
JAPAN 783 126 5 065 377 975 1 050 78 413 6 545 82 52 622 207 10,5%
KOREA 553 52 1 799 100 401 1 137 21 548 4 225 24 81 416 215 4,4%
MALAYSIA 154 33 373 330 621 1 314 2 330 370 3 11 71 7 2,0%
MEXICO 291 130 1 293 1 964 380 1 708 8 199 1 625 14 12 63 4 4,8%
NETHERLANDS 115 18 1 018 41 500 994 14 349 3 632 14 207 818 346 12,4%
NORWAY 127 5 482 385 178 882 205 45 0 8 38 1 0,1%
PORTUGAL 47 10 250 92 225 1 613 1 647 571 3 55 159 18 5,6%
SPAIN 233 47 1 425 505 990 1 646 18 503 4 900 30 105 396 37 13,1%
SWEDEN 140 10 627 407 284 950 1 798 599 2 57 172 4 1,2%
SWITZERLAND 58 9 813 41 285 985 3 656 683 4 79 422 89 6,2%
SOUTH AFRICA 197 60 351 1 219 090 1 733 4 630 458 8 8 77 4 4,1%
THAILAND 190 70 506 1 219 092 1 522 4 078 500 6 7 58 3 3,3%
TURKEY 284 85 815 783 560 1 500 10 917 1 492 16 18 128 14 5,8%
USA 3 930 332 22 996 9 147 281 1 416 123 004 26 873 174 81 371 13 4,4%
WORLD 25 000 7 837 96 100 134 325 435 1 300 173 534 945 354 1 229 22 121 7 4,9%
77
PV ELECTRICITY PRODUCTION / CONTINUED
FIGURE 7.1: PV CONTRIBUTION TO ELECTRICITY DEMAND 2021
16
14
12
10
% 8
6
PVPS countries
World
4
Non-PVPS countries
0
a
ile
th ce
De dia
ria
ina
Fr o
ce
ia
ia
Sl nia
M kia
Sw sia
Fi a
ain
um
an
Ca n
A
nd s
Ge ras
Ta ic
y
ly
Po ey
Uk
ay
l
Tu d
Bu al
Th il
Sl nd
nd
ali
Ho and
ae
re
ric
d
pa
e
ic
Sw mar
an
str
an
az
US
bl
lan
Ita
Ch
Ne ree
an
g
iw
na
ed
lga
rk
rw
y
a
ex
Ch
e
Sp
In
nla
lgi
u
Ko
str
pu
Isr
rtu
Ja
Af
rm
Br
ala
ov
m
ov
Au
ail
l
er
No
n
er
Be
G
Au
Re
Ro
h
itz
ut
h
So
ec
Cz
FIGURE 7.2: SHARE OF RENEWABLE IN THE GLOBAL FIGURE 7.3: NEW RENEWABLE INSTALLED CAPACITY
ELECTRICITY PRODUCTION IN 2021 IN 2021
OTHER RES, 2% OTHER RES (HYDRO

NOT INCLUDED), 4%
PV, 5%
WIND OFFSHORE, 6%
WIND, 7%
HYDROPOWER, 8%
HYDROPOWER, 15%
FOSSIL & PV, 55%
NUCLEAR, 71%
WIND ONSHORE, 26%
SOURCE REN21, IEA PVPS SOURCE REN21, IEA PVPS
78
PV INTEGRATION AND SECTOR COUPLING
THE ENERGY STORAGE MARKET

PV could make EVs greener faster. The shift from
In general, battery storage is seen by some as an opportunity to
fossil fuels to electricity for individual transportation
solve some grid integration issues linked to PV and to increase
and especially cars and light-duty vehicles is a
the self-consumption ratio of distributed PV plants. Despite their
necessary step towards the decarbonization of the
decreasing costs, such solutions are not yet economically viable
transport sector. However, the real emissions of GHG
in all countries and market segments. However, the adoption
for EVs depend on the power mix used to charge
of batteries is on the rise both in the residential segments and
cars. In countries with a power mix heavily relying
in the commercial segments as more and more consumers are
on fossil fuels, the emissions will remain higher than
willing to maximise their self-consumption and to optimize their
in countries with a renewable or carbon-free mix. In
consumption profile.
that respect, some initiatives popped up in the recent
More large-scale PV plants are being built in combination months in Europe to connect the fast development
with batteries, which can be used to stabilize grid injection, of the EV market to renewables and especially PV.
reduce curtailment, and, in some cases, to provide ancillary The idea to propose to the automotive industry to
services to the grid. The displacement of energy towards the decarbonize completely electric vehicles would imply
evening peak allows benefiting from higher wholesale market to sell renewable energy contracts or, easier, shares in
prices and changes the injection pattern of PV. An increasing PV plants, when an EV is brought to the market.
number of tenders are requiring PV to be installed with storage.
Globally, the largest part of batteries sold are used for

transportation in EVs, stationary storage remains the exception From PV to VIPV and VAPV
and volumes remain small. However, the rapid development of With its distributed nature, PV fits perfectly with EV
electric mobility is driving battery prices down much faster than charging during the day when cars are stationed in the
any could have expected in the stationary market alone. This could offices parking or at home. Such slow charging is also
give a huge push to the development of storage as a tool to ease highly compatible with distribution grid constraints.
PV installations in some specific conditions. In addition, new Finally, the integration of PV in the vehicles themselves,
requirements for grid integration in tenders tend to favour the use the so-called VIPV, also offers opportunities to alleviate
of stationary batteries in utility-scale plants to smooth the output of the burden on the grid, increase the autonomy of EVs
the plant, reduce curtailment or reduce the need for grid capacity and connects the automotive and PV sectors. 2021
reinforcement, however this trend would require some more years showed announcements from several manufacturers,
to be confirmed. especially in Japan and Korea, but also Germany and
the Netherlands, for VIPV systems integrated in EVs.
Recently, some first high-end commercial products
THE ELECTRIFICATION OF TRANSPORT have become available in Europe. The IEA PVPS Task
The role of PV as an enabler of that energy transition is more 17 deals with this fast emerging subject.
and more obvious and the idea of powering mobility with solar is
becoming slowly a reality as an increasing number of commercial
partnerships combine EV charging stations to solar systems for
private and public use.
79
PV INTEGRATION AND SECTOR COUPLING / CONTINUED
THE ELECTRIFICATION OF HEATING AND COOLING This axis of innovation to convert green electricity in cooling and
cold storage is therefore seen by the IEA PVPS Tasks as a very
The recent development of PV self-consumption especially in
promising way to absorb the peak production of PV, especially in
Europe has created new opportunities to use solar electricity for
sunny emerging economies. Indeed, places where grid stress is
specific buildings appliances.
very present in summertime, benefiting from solar cooling and
Among others, even if the solar production is not directly linked to cooling thermal storage based on local PV production can become
consumption load in the case of space heating, it is becoming a real a very powerful tool.
source of interest to use solar PV electricity to feed electric domestic
The use of solar energy, namely solar PV and solar thermal,
hot water tanks for instance. Hot water tanks can also serve as
for cooling is profiting from July 2020 a specific IEA SHC Task called
storage and can be successfully combined with a heat pump.
Task 65 (https://task65.iea-shc.org/) which will focus worldwide
Several European manufacturers of electric domestic hot water on innovative ways to adapt and develop existing technologies
tanks are now offering specific electronic devices to directly link (solar and heat pumps) for sunny and hot climates.
extra PV production to an electric boiler. Hot water tanks allow to
increase the self-consumption and to store the PV production.
GREEN HYDROGEN
More single household owners with PV systems take an
Green hydrogen refers to hydrogen produced from renewable
interest in those in order to increase self-consumption.
sources, oppositely to hydrogen produced from fossil fuels or
Specific recommendations exist for connection and metering of
nuclear power. Hydrogen is increasingly seen as a partial answer
storage systems in Switzerland for instance.
to decarbonize some sectors (especially the maritime sector
Another very promising segment in the use of solar PV electricity and long distance, heavy weight road transport. In that respect,
is the use for cooling. Beyond Europe, a lot of countries are very green hydrogen is part of numerous research programs and early
interested in the link between addressing the very rapidly increasing industrialization projects have been initiated in 2021. Produced by
energy need for air conditioning due to the very attractive present competitive PV, transformed in hydrogen for direct use, or under
and future cost of PV electricity. its derivatives (ammonia, etc.), it can also be stored and reproduce
electricity, even if the overall efficiency decreases significantly.
China is at the forefront worldwide for the supply of PV air
conditioning solutions, mainly in the domestic household segment.
For larger coupling, no real commercial products are available.

Nevertheless, more and more design of solar PV systems based
on self-consumption are linked to some specific use of adapted
water chillers including cold water storage.
80
ANNEXES
ANNEX 1: AVERAGE 2021 EXCHANGE RATES

COUNTRY CURRENCY CODE EXCHANGE RATE
IN 2021 (1 USD =)
AUSTRALIA AUD 1,332

CANADA CAD 1,254
CHILE CLP 760,36
CHINA CNY 6,452
DENMARK DKK 6,29
EUROZONE EUR 0,846
ISRAEL ILS 3,232
JAPAN JPY 109,817
KOREA KRW 1144,883
MALAYSIA MYR 4,144
MEXICO MXN 20,284
MOROCCO MAD 8,995
NORWAY NOK 8,598
SOUTH AFRICA ZAR 14,789
SWEDEN SEK 8,584
SWITZERLAND CHF 0,914
THAILAND THB 31,997
TURKEY TRY 8,904
UNITED STATES USD 1
SOURCE IRS
81
ANNEX 2: CUMULATIVE INSTALLED PV CAPACITY (MWp) FROM 1992 TO 2021
COUNTRY 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
AUSTRALIA 7 9 11 13 16 19 23 25 29 34 39 46 52 61 70 82 105 187 571 1 376 2 416 3 226 4 092 5 109 5 985 7 132 11 586 16 399 21 091 26 035
AUSTRIA 1 1 1 1 2 2 3 4 5 6 10 17 21 24 26 28 32 53 95 187 363 626 785 937 1 096 1 269 1 455 1 702 2 043 2 783
BELGIUM 0 0 0 0 0 0 0 0 0 0 0 0 0 0 6 24 112 671 1 108 2 176 2 870 3 139 3 245 3 355 3 535 3 865 4 310 5 127 6 273 7 123
CANADA 1 1 2 2 3 3 4 6 7 9 10 12 14 17 20 26 33 95 281 559 766 1 211 1 843 2 519 2 665 2 913 3 130 3 388 3 713 4 135
CHILE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 3 12 221 576 1 125 1 837 2 406 2 694 3 484 6 165
CHINA 0 0 0 0 0 0 0 0 11 16 34 44 54 62 72 92 132 292 792 3 492 6 692 17 682 28 322 43 472 78 022 130 882 175 142 205 440 253 640 308 520
DENMARK 0 0 0 0 0 0 1 1 1 1 1 2 2 2 2 3 3 4 7 29 499 698 751 979 1 061 1 139 1 254 1 362 1 626 2 344
FINLAND 0 0 0 0 0 0 0 0 0 0 0 1 1 1 2 2 3 5 7 9 9 9 9 20 37 80 134 214 313 413
FRANCE 2 2 2 3 4 6 8 9 11 14 17 21 24 26 38 76 218 440 1 446 3 562 4 906 5 692 6 837 7 920 8 636 9 713 10 755 11 930 13 098 16 450
GERMANY 6 9 12 18 28 42 54 70 114 176 296 435 1 105 2 056 2 899 4 170 6 120 10 566 18 006 25 916 34 077 36 710 37 900 39 224 40 679 42 293 45 181 49 016 53 901 59 661
ISRAEL 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 22 67 186 272 377 588 771 877 952 1 358 1 960 2 414 3 349
ITALY 8 12 14 16 16 17 18 18 19 20 22 26 31 37 50 100 496 1 277 3 605 13 141 16 796 18 198 18 607 18 915 19297 19 682 20 108 20 865 21 650 22 594
JAPAN 19 24 31 43 60 91 133 209 330 453 637 860 1 132 1 422 1 708 1 919 2 144 2 627 3 618 4 914 6 632 13 599 23 339 34 151 42 040 49 500 56 162 63 192 71 868 78 413
KOREA 0 0 0 0 0 0 0 0 0 0 5 6 9 14 36 81 357 524 650 729 1 024 1 555 2 481 3 615 4 502 5 835 8 099 12 665 17 323 21 548
MALAYSIA 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 2 4 34 145 213 273 352 401 918 1 417 1 961 2 330
MEXICO 0 0 9 9 10 11 12 13 14 15 16 17 18 19 20 21 22 25 31 40 52 112 179 246 311 485 3 075 5 001 6 574 8 199
MOROCCO 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 205 206 206 699
NETHERLANDS 0 0 0 0 0 1 1 1 5 9 16 22 40 43 45 49 59 69 111 170 390 767 1 069 1 536 2 061 2 914 4 609 7 225 10 717 14 349
NORWAY 0 0 0 0 0 0 0 0 6 6 6 6 7 7 7 8 8 8 8 9 9 10 12 14 26 44 68 120 160 205
PORTUGAL 0 0 0 0 0 0 0 0 0 1 2 2 3 3 3 18 68 108 134 175 244 299 418 454 519 585 673 907 1 077 1 647
SOUTH AFRICA 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 6 311 1 392 1 486 2 280 2 349 2 409 2 872 4 172 4 630
SPAIN 0 0 0 0 0 0 0 0 0 2 5 11 21 43 125 618 3 351 3 392 3 829 4 233 4 532 4 638 4 661 4 707 4 762 4 897 5 159 10 075 13 603 18 503
SWEDEN 1 1 1 2 2 2 2 3 3 3 3 4 4 4 5 6 8 9 11 15 23 42 77 125 184 269 429 720 1 200 1 798
SWITZERLAND 5 6 7 8 10 11 13 14 16 18 20 22 24 28 30 37 49 80 125 223 437 756 1 061 1 394 1 664 1 906 2 173 2 498 2 973 3 656
THAILAND 0 0 0 0 0 0 0 0 0 0 0 0 0 24 30 32 33 43 49 243 387 823 1 298 1 420 2 446 3 056 3 513 3 529 35 78 4 078
TURKEY 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 6 32 64 358 1 175 4 206 7 339 8 551 9 424 10 917
UNITED STATES 0 0 0 0 0 0 0 0 0 0 0 0 111 190 295 455 753 1 188 2 017 3 937 7 130 12 076 18321 25 821 40 973 51 818 62 498 76 274 96 131 123 004
REST OF EU 0 0 0 0 0 0 0 0 0 0 1 11 21 23 34 42 68 505 2 222 2 908 5 039 7420 7 820 8 218 8 600 8 980 9 862 11 715 16 777 23 321
COUNTRIES
ANNEXES
TOTAL IEA PVPS 50 65 90 115 150 206 271 372 572 783 1 142 1 563 2 694 4 106 55 26 7 889 14 177 22 191 38 794 68 234 95 613 130 165 165 604 207 614 274 909 359 002 444 009 527 065 640 989 776 869
TOTAL NON IEA 0 0 0 0 0 0 0 0 1 8 14 23 33 45 67 94 178 319 796 2 812 5 237 8 449 13 133 21 612 31 107 49 874 69 492 99 294 130 830 168 485
PVPS
TOTAL 50 65 90 115 150 206 271 372 573 790 1 156 1 587 2 727 4 152 5 593 7 983 14 355 22 510 39 590 71 046 100 850 138 614 178 736 229 225 306 016 408 876 513 502 626 359 771 819 945 354
82
SOURCE IEA PVPS, BECQUEREL INSTITUTE & OTHERS
83
ANNEX 3: ANNUAL INSTALLED PV CAPACITY (MWp) FROM 1992 TO 2021
COUNTRY 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
AUSTRALIA 7 2 2 2 3 3 4 3 4 4 6 6 7 8 10 12 22 83 383 806 1 039 811 866 1 018 876 1 147 4 454 4 813 4 692 4 944
AUSTRIA 1 0 0 0 0 0 1 1 1 1 4 6 4 3 2 2 5 20 43 92 176 263 159 152 159 173 186 247 341 739
BELGIUM 0 0 0 0 0 0 0 0 0 0 0 0 0 0 6 18 88 559 437 1 068 694 269 106 110 180 330 445 817 1 146 850
CANADA 1 0 0 0 1 1 1 1 1 2 1 2 2 3 4 5 7 62 187 277 208 445 633 675 146 249 217 258 325 421
CHILE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 3 9 209 355 549 712 569 288 790 2 681
CHINA 0 0 0 0 0 0 0 0 11 5 19 10 10 8 10 20 40 160 500 2 700 3 200 10 990 10 640 15 150 34 550 52 860 44 260 30 300 48 200 54 880
DENMARK 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 1 3 22 470 199 53 228 81 78 115 109 264 718
FINLAND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 1 2 2 2 0 0 0 11 17 43 53 81 98 100
FRANCE 2 0 0 1 2 2 2 2 2 3 3 4 3 2 12 38 143 222 1 006 2 116 1 344 786 1 145 1 083 716 1 077 1 042 1 175 1 168 3 350
GERMANY 6 3 3 6 10 14 12 16 44 62 120 139 670 951 843 1 271 1 950 4 446 7 440 7 910 8 161 2 633 1 190 1 324 1 455 1 614 2 888 3 835 4 885 5 760
ISRAEL 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 21 45 119 86 105 211 183 106 75 406 602 454 935
ITALY 8 4 2 2 0 1 1 1 1 1 2 4 5 7 13 50 396 781 2 328 9 536 3 655 1 402 409 308 382 385 426 758 785 944
JAPAN 19 5 7 12 16 32 42 75 122 123 184 223 272 290 287 210 225 483 991 1 296 1718 6 968 9 740 10 811 7 889 7 460 6 662 7030 8 676 6 545
KOREA 0 0 0 0 0 0 0 0 0 0 5 1 3 5 22 45 276 167 127 79 295 531 926 1 134 887 1 333 2 265 4 566 4 658 4 225
MALAYSIA 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 2 34 111 67 61 78 49 517 499 543 370
MEXICO 0 0 9 0 1 1 1 1 1 1 1 1 1 1 1 1 1 3 6 9 12 60 67 67 65 174 2 590 1 926 1 573 1 625
MOROCCO 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 205 1 0 493
NETHERLANDS 0 0 0 0 0 0 0 0 4 3 8 6 18 4 2 3 10 10 42 59 220 377 302 467 525 853 1 695 2 616 3 492 3 632
NORWAY 0 0 0 0 0 0 0 0 6 0 0 0 0 0 0 1 0 0 0 0 1 1 2 2 11 18 25 51 40 45
PORTUGAL 0 0 0 0 0 0 0 0 0 1 0 0 1 0 0 14 50 40 26 41 69 55 119 36 65 66 88 234 170 571
SOUTH AFRICA 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 6 305 1 081 94 794 69 60 463 1 300 458
SPAIN 0 0 0 0 0 0 0 0 0 2 3 6 10 32 82 493 2 733 41 437 404 299 106 23 46 55 135 262 4 916 3 528 4 900
SWEDEN 1 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 2 1 2 4 8 19 35 48 59 85 160 291 480 599
SWITZERLAND 5 1 1 1 2 2 2 2 2 2 2 2 2 4 2 7 12 30 46 98 214 319 305 333 270 242 267 325 475 683
THAILAND 0 0 0 0 0 0 0 0 0 0 0 0 0 24 7 2 1 10 6 194 144 436 475 122 1 027 610 456 16 49 500
ANNEXES / CONTINUED
TURKEY 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 5 26 32 294 818 3 031 3 133 1 212 874 1 492
UNITED STATES 0 0 0 0 0 0 0 0 0 0 0 0 111 79 105 160 298 435 829 1 920 3 193 4 946 6 245 7 500 15 152 10 845 10 680 13 776 19 857 26 873
REST OF EU 0 0 0 0 0 0 0 0 0 0 0 10 10 2 11 7 27 437 1 717 686 2 130 2 381 400 398 382 380 882 1 853 5 062 6 546
COUNTRIES
TOTAL IEA PVPS 50 16 25 25 35 56 65 101 199 211 360 421 1 130 1 423 1 420 2 363 6 288 8 014 16 603 29440 27 382 34 552 35 438 42 010 67 295 84 093 85 007 83 057 113 925 1358 80
TOTAL NON IEA 0 0 0 0 0 0 0 0 1 7 6 9 10 12 21 27 85 141 477 2 016 2 422 3 212 4 685 8 478 9 485 18 767 19 618 29 801 31 537 37 654
PVPS
TOTAL 50 16 25 25 35 56 65 101 200 218 366 430 1 140 1 435 1 441 2 390 6 372 8 155 17 080 31 456 29 805 37 765 40 123 50 488 76 780 102 860 104 625 112 858 145 461 173 534
LIST OF FIGURES
FIGURE 2.1: EVOLUTION OF CUMULATIVE PV INSTALLATIONS 10

FIGURE 2.2: PV PENETRATION PER CAPITA IN 2021 11
FIGURE 2.3: EVOLUTION OF ANNUAL PV INSTALLATIONS 11
FIGURE 2.4: EVOLUTION OF MARKET SHARE OF TOP COUNTRIES 12
FIGURE 2.5: GLOBAL PV MARKET IN 2021 14
FIGURE 2.6: CUMULATIVE PV CAPACITY END 2021 14
FIGURE 2.7: EVOLUTION OF REGIONAL PV INSTALLATIONS 15
FIGURE 2.8: 2018-2021 GROWTH PER REGION 15
FIGURE 2.9: CENTRALIZED PV INSTALLED CAPACITY PER REGION 2021 17
FIGURE 2.10: CENTRALIZED PV CUMULATIVE INSTALLED CAPACITY PER REGION 2021 17
FIGURE 2.11: DISTRIBUTED PV INSTALLED CAPACITY PER REGION 2021 18
FIGURE 2.12: DISTRIBUTED PV CUMULATIVE INSTALLED CAPACITY PER REGION 2021 18
FIGURE 2.13: ANNUAL SHARE OF CENTRALIZED AND DISTRIBUTED GRID-CONNECTED INSTALLATIONS 2011 – 2021 19
FIGURE 2.14: CUMULATIVE SHARE OF GRID CONNECTED PV INSTALLATIONS 2011 – 2021 19
FIGURE 2.15: ANNUAL GRID-CONNECTED CENTRALIZED AND DISTRIBUTED PV INSTALLATIONS BY REGION IN 2021 22
FIGURE 2.16: EVOLUTION OF PV INSTALLATIONS IN THE AMERICAS PER SEGMENT 23
FIGURE 2.17: EVOLUTION OF PV INSTALLATIONS IN ASIA PACIFIC PER SEGMENT 25
FIGURE 2.18: EVOLUTION OF PV INSTALLATIONS IN EUROPE PER SEGMENT 26
FIGURE 2.19: EVOLUTION OF PV INSTALLATIONS IN AFRICA AND THE MIDDLE EAST PER SEGMENT 28
FIGURE 3.1: EVOLUTION OF MARKET INCENTIVES AND ENABLERS: 2010, 2015, 2021 32
FIGURE 3.2A: MAIN DRIVERS OF THE DISTRIBUTED PV MARKET IN 2021 33
FIGURE 3.2B: MAIN DRIVERS OF THE CENTRALIZED PV MARKET IN 2021 33
FIGURE 4.1: PV SYSTEM VALUE CHAIN (EXAMPLE OF CRYSTALLINE SILICON PV TECHNOLOGY) 44
FIGURE 4.2: SHARE OF PV POLYSILICON PRODUCTION IN 2021 44
FIGURE 4.3: SHARE OF PV WAFER PRODUCTION IN 2021 46
FIGURE 4.4: SHARE OF PV CELL PRODUCTION IN 2021 47
FIGURE 4.5: SHARE OF PV MODULE PRODUCTION IN 2021 48
FIGURE 4.6: PV MODULE PRODUCTION PER TECHNOLOGY IN IEA PVPS COUNTRIES IN 2021 49
FIGURE 4.7: YEARLY PV INSTALLATION, PV PRODUCTION AND PRODUCTION CAPACITY 2011-2021 (GWp)50
FIGURE 4.8: OVERVIEW OF DOWNSTREAM SECTOR (UTILITY PV APPLICATION) 53
FIGURE 5.1: CO2 EMISSIONS AVOIDED BY PV [MT CO2,EQ] 57
FIGURE 5.2A: AVOIDED CO2 EMISSIONS AS PERCENTAGE OF ELECTRICITY SECTOR TOTAL EMISSIONS 58
FIGURE 5.2B: AVOIDED CO2 EMISSIONS AS PERCENTAGE OF ENERGY SECTOR TOTAL EMISSIONS 58
FIGURE 5.3: BUSINESS VALUE OF THE PV MARKET IN 2021 59
FIGURE 5.4: CONTRIBUTION TO GLOBAL GDP OF PV BUSINESS VALUE AND ENERGY SECTOR INVESTMENTS 60
FIGURE 5.5A: ABSOLUTE PV INDUSTRIAL BUSINESS VALUE IN 2021 60
FIGURE 5.5B: PV INDUSTRIAL BUSINESS VALUE ALONG THE VALUE CHAIN IN 2021 61
FIGURE 5.5C: PV INDUSTRIAL BUSINESS VALUE AS SHARE OF GDP IN 2021 61
FIGURE 5.6: GLOBAL EMPLOYMENT IN PV PER COUNTRY 62
FIGURE 6.1: PV MDOULES SPOT PRICES LEARNING CURVE (1992-2021) 66
FIGURE 6.2: EVOLUTION OF PV MODULES PRICES RANGE IN USD/W 66
FIGURE 6.3: INDICATIVE MODULE PRICES IN REPORTING COUNTRIES 67
FIGURE 6.4: 2021 PV MARKET COSTS RANGES 68
FIGURE 6.5: EVOLUTION OF RESIDENTIAL AND GROUND-MOUNTED SYSTEMS PRICE RANGE 2012 - 2021 (USD/W) 69
FIGURE 6.6: INDICATIVE INSTALLED SYSTEM PRICES IN SELECTED IEA PVPS REPORTING COUNTRIES IN 2021 69
FIGURE 6.7: LCOE OF PV ELECTRICITY AS A FUNCTION OF SOLAR IRRADIANCE & RETAIL PRICES IN KEY MARKETS* 71
FIGURE 6.8.A: NORMALISED LCOE FOR SOLAR PV BASED ON LOWEST* PPA PRICES 2016 - Q4 2021 73
FIGURE 6.8.B: NORMALISED LCOE FOR SOLAR PV BASED ON RECENT PPA PRICES 2021 73
FIGURE 7.1: PV CONTRIBUTION TO ELECTRICITY DEMAND 2021 78
FIGURE 7.2: SHARE OF RENEWABLE IN THE GLOBAL ELECTRICITY PRODUCTION IN 2021 78
FIGURE 7.3: NEW RENEWABLE INSTALLED CAPACITY IN 2021 78
84
LIST OF TABLES
TABLE 2.1: EVOLUTION OF TOP 10 MARKETS 13

TABLE 2.2: TOP 10 COUNTRIES FOR CENTRALIZED PV INSTALLED IN 2021 16
TABLE 2.3: TOP 10 COUNTRIES FOR CUMULATIVE CENTRALIZED PV INSTALLED CAPACITY IN 2021 16
TABLE 2.4: TOP 10 COUNTRIES FOR DISTRIBUTED PV INSTALLED IN 2021 18
TABLE 2.5: TOP 10 COUNTRIES FOR CUMULATIVE DISTRIBUTED PV INSTALLED CAPACITY IN 2021 18
TABLE 2.6: 2021 PV MARKET STATISTICS IN DETAIL 30
TABLE 4.1: GLOBAL TOP FIVE MANUFACTURERS IN TERMS OF PV CELL/MODULE PRODUCTION AND SHIPMENT VOLUME (2021) 47
TABLE 4.2: EVOLUTION OF ACTUAL MODULE PRODUCTION AND PRODUCTION CAPACITIES (MWp)51
TABLE 5.1: TOP 10 RANKING OF PV BUSINESS VALUES 60
TABLE 6.1: TOP 10 LOWEST WINNING BIDS IN PV TENDERS FOR UTILTY SCALE PV SYSTEM 74
TABLE 6.2: LOWEST WINNING BIDS IN PV TENDERS FOR UTILTY SCALE PV SYSTEM PER REGION 74
TABLE 7.1: 2021 PV ELECTRICITY STATISTICS IN IEA PVPS COUNTRIES 77
ANNEX 1: AVERAGE 2021 EXCHANGE RATES 81
ANNEX 2: CUMULATIVE INSTALLED PV CAPACITY (MW) FROM 1992 TO 2021 82
ANNEX 3: ANNUAL INSTALLED PV CAPACITY (MW) FROM 1992 TO 2021 83
85
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Task 1 Strategic PV Analysis and Outreach

REPORT IEA PVPS T1-43:2022

PHOTOVOLTAIC POWER SYSTEMS TECHNOLOGY COLLABORATION PROGRAMME

ISBN ISBN 978-3-907281-35-2: Trends in Photovoltaic Applications 2022.

REPORT SCOPE AND OBJECTIVES

INTRODUCTION TO THE CONCEPTS AND METHODOLOGY 5

PV MARKET DEVELOPMENT TRENDS 9

SOCIETAL IMPLICATIONS OF PV AND ACCEPTANCE 55

COMPETITIVENESS OF PV ELECTRICITY IN 2021 65

PV IN THE ENERGY SECTOR 75

TOTAL BUSINESS VALUE IN PV SECTOR IN 2021

$190 BILLION USD TOP

PV CONTRIBUTION TO ANNUAL INSTALLED

global electricity CAPACITY

CLIMATE CHANGE 600

saved in 2021 200

Yearly PV installations Total module PV production Total module production capacity

PV PENETRATION PER CAPITA IN 2021

42 COUNTRIES PV POWER PER CAPITA 18 COUNTRIES

SOURCE IEA PVPS & OTHERS

Thin-film cells are formed by depositing extremely thin layers of

Organic thin-film PV (OPV) cells use dye or organic semiconductors

PV APPLICATIONS AND METHODOLOGY FOR THE MAIN PV

The group of IEA PVPS countries represented 753 GW of the global

THE GLOBAL PV INSTALLED CAPACITY / CONTINUED

FIGURE 2.1: EVOLUTION OF CUMULATIVE PV INSTALLATIONS

SOURCE IEA PVPS & OTHERS

PV PENETRATION PER CAPITA As a comparison, 500 W represents the power of a large PV

FIGURE 2.2: PV PENETRATION PER CAPITA IN 2021

SOURCE IEA PVPS & OTHERS

EVOLUTION OF PV ANNUAL INSTALLATIONS

FIGURE 2.3: EVOLUTION OF ANNUAL PV INSTALLATIONS

SOURCE IEA PVPS & OTHERS

THE GLOBAL PV INSTALLED CAPACITY / CONTINUED

The market in Japan contracted slightly with 6,6 GW in 2021,

SOURCE IEA PVPS & OTHERS

TABLE 2.1: EVOLUTION OF TOP 10 MARKETS

THE GLOBAL PV INSTALLED CAPACITY / CONTINUED

Other countries reached significant installation levels in 2021:

POLAND, 2,14% VIETNAM, 1,95%

USA, 15,49% CHINA, 31,64%

FIGURE 2.7: EVOLUTION OF REGIONAL PV INSTALLATIONS

SOURCE IEA PVPS & OTHERS

FIGURE 2.8: 2018-2021 GROWTH PER REGION

SOURCE IEA PVPS & OTHERS

New utility-scale PV plants are increasingly using trackers to

CHINA 25,60 CHINA 199,94

USA 20,26 USA 80,33

INDIA 11,62 INDIA 52,90

SOUTH KOREA 4,00 JAPAN 30,12

SPAIN 3,50 SOUTH KOREA 18,91

JAPAN 2,99 SPAIN 15,23

NETHERLANDS 2,35 GERMANY 11,10

FRANCE 2,22 AUSTRALIA 9,00

GERMANY 2,01 NETHERLANDS 8,49

AUSTRALIA 1,71 UK 8,35

SOURCE IEA PVPS SOURCE IEA PVPS

PV MARKET SEGMENTS / CONTINUED

CHINA 29,28 CHINA 108,22

USA 6,62 GERMANY 48,56

INTRODUCTION TO THE CONCEPTS AND METHODOLOGY 5

PV MARKET DEVELOPMENT TRENDS 9

SOCIETAL IMPLICATIONS OF PV AND ACCEPTANCE 55

COMPETITIVENESS OF PV ELECTRICITY IN 2021 65

PV IN THE ENERGY SECTOR 75