June 23, 2008

San Francisco, CA, USA: Solarbuzz Reports Europe Facing Significant PV Market Realignment; While US "Order Book" Surpasses 1GW

According to two downstream market reports released today by Solarbuzz LLC, solar photovoltaic (PV) demand in Europe and the United States is set to be the primary regional drivers of global PV market growth over the next five years.

The European PV market, buoyant in 2007, is heading for a similar outcome this year. However, some turbulence lies ahead as European governments get to grips with rapidly escalating program costs. As a consequence, the pathway to downstream corporate profitability in this region will become significantly more challenging.

Faster annual feed-in tariff decline in Germany and revised incentive terms in Spain next year will be partially offset by fast growing "start-up" European markets and significant adjustments in factory gate module prices, all of which will form part of the new downstream commercial equation. With relatively few countries and market segments forming the core marketing opportunities, targeted customer segment marketing and sales channel strategy will return to top of the agenda.

Meanwhile, the US market faces its own suite of challenges and opportunities. It is a market now poised for lift off with some 1.1 gigawatt of PV projects in prospect - the so-called "Order Book". This un-risked total is some 5 times the size of the 2007 market and includes projects that have been reserved under PV incentive programs and direct procurement being planned by end users outside PV programs.

However, the short-term challenge remains how to phase these prospects in the light of uncertainty over the Federal Investment Tax Credit. Nonetheless, given the strength of the order book, downstream companies are well positioned to adjust their mix and phasing of the project pipeline to still deliver market growth in 2009.

Each report concludes with new 5-year forecasts, taking into account global module/supply demand balances and relative customer segment economic attractiveness to show how each regional market will adapt to the policy environment in both regions.

Said Craig Stevens, President of Solarbuzz LLC, "Our goal here has been to undertake an intensive review of the current policy environment in both regions to provide a practical assessment of how the policy outcomes will impact market and segment demand and price."

Further details about: European Major PV Markets 2008 and US Grid Connect 2008