Photovoltaics and energy storage lead clean energy technology trends in 2022
Research institute IHS Markit has released an annual report on the development trend of the photovoltaic and energy storage industry. In the report, the company noted that photovoltaic systems and energy storage systems dominate clean energy technology trends in 2022. The company defines distributed generation facilities (DGs) as photovoltaic systems with an installed capacity of less than 5MW, and expects a 20% increase in installed capacity in 2022.
IHS Markit said the PV industry continues to show strong resilience in a challenging market environment. While many utility-scale PV projects have been delayed or cancelled over the past two years, distributed generation facilities have not lost their appeal.
“This discrepancy reflects both the policy push for distributed generation in individual markets and the concerns of many consumers about high electricity prices and climate footprint,” the report states. ”
About 60% of the growth in installed capacity of distributed generation facilities occurred in China and Germany, which are pursuing policies to make distributed generation a core part of renewable energy targets. Brazil is another high-profile distributed generation market, as distributed generation facilities installed through 2023 are still exempt from grid connection fees. In contrast, in the U.S., this segment is likely to shrink significantly as many major state markets eliminate net metering policies.
IHS “Even with high levels of capital expenditure, the electricity generated by distributed generation facilities still has the ability to compete with retail prices in many markets, meaning that the distributed generation sector is not as sensitive to electricity prices as utility-scale PV systems,” Markit analysts said. ”
Capital expenditures are up
Despite higher-than-expected capital expenditures in 2022, new patterns of renewable energy growth have emerged. Renewables are already the cheapest source of electricity generation globally, and falling costs have led to further capacity increases and price reductions due to technological developments and policy advances.
PV investors already expect capital expenditures to continue to decline, but as the technology matures, the rate of decline has slowed. This, combined with supply chain hurdles and rising transportation and material costs, resulted in higher-than-expected capital expenditures for PV projects in 2022.
As renewable energy penetration increases, the focus is no longer on reducing costs, but on providing value to the power system. IHS Markit analysts said: “At a time of high market volatility, the predictability of renewable energy operations is valued. ”
Investors also see renewable energy investments as a way to deliver on climate commitments and reduce risk portfolios. IHS Markit said the consolidation of the renewable energy sector and the strong push for green financing have reduced the cost of capital for renewable energy projects. Recent fluctuations and spikes in electricity prices have increased installed renewable energy capacity.
IHS Markit analysts said: “These perceived values offset higher-than-expected capital expenditures in the PV industry and supported the continued construction of new renewable energy capacity. ”
Supply chain difficulties, trade barriers, geopolitics and other factors have been pushing PV manufacturers to meet the needs of end users. IHS Markit said supply chain tensions could continue for some time, but there have been some positive developments:
• Polysilicon capacity is growing faster than expected.
• New entrants to the wafer market will increase capacity and price competition.
• PV manufacturing in China is no longer limited by energy intensity and energy consumption.
India, the US, Europe and Southeast Asia will continue to announce increased capacity of ingots, wafers, PV cells and PV modules in 2023 as supply chains grow and adapt to the new international trade environment.