IHS Markit Predicts a 16% YOY Drop in Solar Capacity Additions in 2020

Even as estimates and predictions on the impact of the Coronavirus pandemic on the renewable energy, and solar sector in particular are announced and updated with each passing week, comes a specific prediction from IHS Markit.

The global research and analytics firm has predicted a degrowth of as much as 16 percent in global solar capacity growth, from an estimated 125 GW in 2019 to as low as 105 GW in 2020. That number could have been much worse, but for an expected uptick in installations in China, where the  industry is expected to grow strongly, on the back of government backed measures.

The firm has identified component shortages from China, due to the New Year holiday season and the subsequent extended leave after the festive season as a result of COVID-19-related government restrictions that limited or delayed overseas installations, as the key disruptive factor in early 2020.

Even though PV component production is surging back to full capacity levels, the spread of the Covid pandemic around the world, especilly key markets the US, India and Europe, has put paid to any hopes of a quick recovery. In fact, some industry leaders, notably Sunil Jain, CEO of Hero Future Energies in India , have gone on record with apprehensions that projects might see delays of as long as 6 months.

IHS has been more focused on the impact on planning and start of new PV projects through the second half of 2020 across key global markets.

IHS Markit is much more optimistic on the original epicentre of the outbreak, China, where it expects around 45GW in 2020, after an over 30 drop in 2019, reaching just over 30GW. The drop in 2019 had been caused by an abrupt withdrawal of state subsidies, and delays in announcement of the new regime for incentives. The agency believes Chinese government backed stimulus will play a key role inreviving growth in the country.