Mordor Intelligence Pegs 6.97% CAGR in 2023-28 for Distributed Solar Power Generation

Mordor Intelligence Forecasts CAGR of 6.97% During 2023-2028 for Distributed Solar Power Generation

A report release by Mordor Intelligence on distributed solar power generation market size forecasts that the market is expected to grow from USD 139.96 billion in 2023 to USD 196.03 billion. It is estimated that this growth is to be attained by 2028, at a CAGR of 6.97% during the forecast period (2023-2028).

The report mentions that the market was negatively impacted by COVID-19 in 2020 and presently the market has now reached pre-pandemic levels.

Major Solar Distribution Generation Announcements

In the report, for May 2022, GreenYellow was awarded a contract to those who built 8.03 MWp of solar distributed generation (DG) plants which supplied power to a pharmacy chain Grupo DPSP in Brazil. In an agreement with Brazil’s Grupo DPSP, which is expected to install 25,000 PV at five locations, three in Sao Paulo, one in Rio de Janeiro, and one in the Federal District. 

The report also makes a mention of the previously announced partnership, in March 2022, between Smart Power India (SPI) with Adani Solar. This announcement mentions that the partnership is to promote solar energy usage in rural areas of Uttar Pradesh, Bihar, Jharkhand, and Odisha. The MoU aims to boost the usage of solar rooftop panels and achieve 5 MW of solar deployment through Adani Solar and partners in rural and peri-urban areas of the Indian states.

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The Leaders

The report shares names of the top leaders in the distributed solar power generation market, which are Suntech, Sharp Energy Solutions Corporation, Tesla Inc, Canadian Solar Inc, First Solar Inc. The report shared data on the contract of ten years, during which GreenYellow will supply 15 GWh of power annually to Grupo DPSP. It mentions that GreenYellow will provide the entire initial investment and take care of the plant’s construction, operation, and maintenance (O&M) for the duration of the contract.

Declining Price of Solar PV System and Installations Cost to Push Market 

• The report highlights that in the last decade, the average cost of a solar PV panel has dropped by nearly 90% worldwide. Prices of other components have also fallen significantly since 2011, which reduces the levelized cost of electricity (LCOE) for distributed and utility-scale solar PV generation.​
• The report attributes the decline in solar PV to a combination of techno-economic and geopolitical factors. It estimates the cost of solar PV panels prices to reduce slightly and forecast the solar PV panel prices to continue to decline. 
• The United States National Renewable Energy Laboratory (NREL), report says that since 2010, there has been a 64%, 69%, and 82% reduction in the cost of residential, commercial-rooftop, and utility-scale PV systems in the United States, respectively. The reported decline in the prices of solar panels in Europe and the United States is primarily due to the drop in solar panel prices which will impact the market and drive the demand for solar panels in these regions.​
• The report anticipates the price decline to affect many residential and commercial consumers that opted for rooftop solar PV systems to reduce energy costs and recovery time. The report  further adds that it had expected that by 2020, the prices of solar PV modules will decline by approximately 90%. However, this changed in 2021, when for the first time in the last decade, the prices went significantly up by 18%. 
• According to the National Renewable Energy Laboratory (NREL), the average selling price of the Mono C-Si solar PV module was 0.25 USD/watt in Q2 2022, lower than 0.26 USD/watt in Q1 2022. The declining module price has increased the demand for distributed solar power generation.
• Reportedly, the industrialization of these modular technologies has yielded economies of scale and increased competition to improved manufacturing processes and supply chains. The report finds the overall decline in solar PV system costs to be attributed to the effective feed-in tariff programs in countries like Germany.
• The report highlights that decline in the cost of solar PV and in the cost of batteries have been significant drivers of the distributed solar energy market in recent years. This trend is expected to continue during the forecast period.
• The report also shared that the prices of lithium-ion batteries have declined by over 86%, from 1,000 USD/kWh in 2010 to 132 USD/kWh in 2021.
• Thus, the improved cost-effectiveness of batteries and solar PV modules will benefit the distributed solar energy market during the forecast period.

A few months back, Union Minister for New and Renewable Energy RK Singh had announced starting a new scheme to boost distributed renewable energy (DRE).