Saudi and Morocco lead solar demand
Report cites Saudi and Morocco as MENA?s strongest demand for solar
Saudi Arabia and Morocco are two of the strongest markets in the Middle East when it comes to solar demand, a new report by Lux Research has shown.
The global solar market is expected to grow from 15.8GW in 2010 to 37.5GW by 2016 for $65.4bn, a compound annual grow rate of 15.5%, the report said. It added that while it was lower than the industry’s past history of 30%+ annual growth rates, it was a sign of the market’s increasing maturity and its move away from subsidies as a driver of growth.
“Morocco and Saudi Arabia are strong in the [Middle Eastern] region. Saudi Arabia grows quickly to a 120MW market in 2016, while Morocco grows a bit more modestly to a 54MW market the same year,” said Matthew Feinstein, an analyst with Lux Research.
“Totalling 2011 through 2016, we project 200MW for Morocco and 300MW for Saudi Arabia. [However], other high-potential markets like Egypt are tempered by political instability.”
“India is another market worth watching,” he added. “With quarterly IRRs skyrocketing past 20% thanks to the newly introduced National Solar Mission, it could become one of the strongest demand markets through 2016 – if subsidies are extended past 2013, as expected.”
Using internal rates of return (IRR) to calculate the demand and projected growth for solar across disparate markets, the Lux Research report was able to showcase the breakdown of demand for residential, commercial and utility installations in the 50 United States, 31 Chinese provinces and semi-autonomous regions, along with 75 countries and regions globally.
In Europe, Portugal is expected to be one of the best markets for investment through to 2013, due to its steadily rising internal rates of returns from the six major solar technologies. The country is expected to have an annual solar market of 400MW by 2016.
“Elsewhere in Europe, high solar potential and favourable IRRs for investors are countered by uncertainty surrounding incentives, which could slow growth moving forward,” Feinstein explained.
“Italy and Germany will remain the continent’s most stable markets with returns hovering near 9% and 22% respectively through to 2016, thanks to annual incentive step-downs.”