As the Coronavirus crisis hits hard at the global economy, solar PV installations around the world is expected to drop 18 per cent from 129.5 gigawatts (GW) to 106.4 GW in 2020.
Consultancy firm Wood Mackenzie in its new report says that the pandemic will have a significant impact on the global solar PV market and the construction and development is slowing as countries around the world enforce unprecedented lockdowns.
Tom Heggarty, WoodMac Principal Analyst of Solar said “Next year will be a challenging one for solar, too. We assume that the economic damage caused by the pandemic and concurrent crash in oil prices will tip the world into recession in 2020.”
Even if a strong economic recovery is expected next year, projects that would be delivered in 2021 are being developed and financed today. When the recession hits, not all activity will go ahead as planned.
Heggarty further added “Demand destruction will be offset to some degree by the spill-over of delayed projects from 2020 to 2021. Nonetheless we have reduced our 2021 forecast from 127.2 GW to 123.6 GW, down 3 per cent.”
In China – the initial epicentre of the outbreak – economic indicators suggest a recovery is underway.
Wafer, cell and module production is ramping back up towards full capacity and construction at many project sites has resumed says the research firm.
WoodMac does not expect the impact on the Chinese PV market, either upstream or downstream, will continue beyond the end of the second quarter this year.