After a turbulent 2011, one thing is perfectly clear: solar markets are not for the faint-hearted. Solyndra is gone; Solon filed for bankruptcy; German PV installations skyrocketed, while the price of PV panels plummeted; and China and the U.S. engaged in a nasty trade dispute. All of these events occurred against the ominous backdrop of the Fukushima nuclear crisis.

Do you believe that the waters will settle in 2012? Think again.

We have just begun to observe the tip of the iceberg of the solar industry shakeout. Expect big names to go bust, European governments to step heavily on the FIT brakes, yet solar technology to get even cheaper and the market to grow even larger.

Considering this roller coaster ride is going to continue, it is crucial to correctly assess which solar markets will provide a safe and profitable return on your investment. Bypass the old continent if you are seeking swift climbs. Europe will not disappear, but it will take a back seat to other markets in the coming years. Apricum’s market model for global PV demand indicates that Europe’s piece of the pie will decline from a whopping 87% in 2010 to a more humble 27% in 2015.

Conversely, North America and Asia will enjoy most of the growth. Despite writing off the Section 1603 Treasury Program, the U.S. will boast one of the fastest growing markets in the solar industry. Not to be outdone, China is ready to double last year’s results and hit 5 GW of new PV installations in 2012.

Closely following the Chinese and American goliaths is Japan. The meltdown of the Daiichi reactor had a powerful impact and the country is turning to the sun to fill in the hollow nuclear gap. A goal to install 28 GW of solar capacity by 2020 plus a fresh and generous FIT bill that may land in as soon as July, could make Japan the epicenter of massive solar activity in 2012.

Beyond North America, China and Japan, where are the sweet spots for fast growth? In the “sunbelt” countries. Turkey, Saudi Arabia, Brazil and India are the rising stars leading this pack. The sinking costs of solar panels, increasing prices of fossil fuels, many hours of sun and high energy consumption propel their growth.

Turkey’s spotlight is on hydro and wind, yet its solar future is bright – the Turkish solar hot water market is already the second biggest worldwide, only behind China. The installed PV capacity will leap from a few MW in 2010 to up to 10 GW in 2020.

Saudi Arabia is on the verge of becoming the biggest solar actor in the Middle East-Northern Africa region. By 2020, the kingdom could accumulate up to 14 GW of solar capacity. In the shorter run, we all await government institution KA-CARE and oil giant Saudi Aramco to launch large-scale solar tenders adding up to 1 GW in the next two years.

Brazil is a renewables land by geography; almost 80% of its electricity comes from hydro, biomass and wind – 66% alone from waterfalls. In the last three years, Brazil has sowed the seeds for the wind industry and now intends to exploit that experience to expand its solar market; lawmakers are hard at work on a scheme for PV and 2012 ought to see the first auction to purchase 100 MW of sun power.

India’s solar plans are moving at full throttle. The 2022 target of 20 GW installed looks closer today than ever. As of 2012, the National Solar Mission and Gujarat and Rajasthan solar policies are pulling the wagon. Furthermore, China’s module dumping has helped push the Indian market’s take-off.

The sunbelt countries have the basic ingredients for a profitable solar recipe. As they lay the much-needed legal foundations, gain access to capital and get up to speed on technical know-how, they will begin to shift the center of global solar demand. Now is the time to trek into these markets. The rewards can be colossal and the pitfalls deep. As always, it is wise to adventure into a new land, compass and map in hand – or even better, with a sherpa.

Author:

Apricum – The Cleantech Advisory

Apricum is a global transaction and strategy advisory firm dedicated to renewable energy and cleantech. Apricum’s team of experts combines decades of industry experience in cleantech, consulting, and corporate and project finance with an in-depth understanding of renewable-energy market dynamics.

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