Discussing the Future of the UK Solar Industry: Part Three – A Perspective on International Investment Trends

by Solar Selections on January 4, 2012

Following on from our two previous reports, this article will adopt an international perspective to further analyse the future of the UK solar industry. Bloomberg New Energy Finance‘s comprehensive report and sources such as PV-Tech and EnergyTrend will be used to generate an informed and updated look at how the UK market will grow compared with other renewable energy markets in the world.

If you’re yet to read through our reports on the future of the UK’s Residential and Commercial markets, please click on their respective links. It must be said that the thoughts contained in all of these reports are our educated thoughts, but further investment advice should be requested from one of our team for any interested parties. Contact us here

If we were to summarise the direction of renewable energy sources in the coming two decades it would be upwards. This is primarily due to the three pronged influence of the rising cost of fossil fuels, increased knowledge and concern about climate change and individual and collective government’s national economic and environmental policies promoting renewable energy source generation. Economically it would seem that the last two decades have completely changed the judgement on renewable energy, and it has become a bankable, robust market for investors. This specifically fiscal shift has been one of the major developments and means the support and money needed to continue the upwards trend exists.

Summary of Renewable Energy Sources

Bloomberg have broken down the growth of the renewable energy markets both by region and overall by each technology.

MENA = Middle East and North Africa
RoW = Rest of the World

As can be seen clearly, the markets are all growing at varying degrees of aggressiveness. Solar in particular is expected to comprehensively be comparable only with wind in terms of global renewable energy generation. Europe remains a stable market, not quite comparing with the rates of growth in areas such as Latin America or countries such as India and China.

The Numbers

Europe will continue it’s dominance of the market up until around 2015, at which point developing countries in the rest of the world and China will begin to take over as the major markets. The general idea behind this is threefold:

  1. European and American markets will continue to struggle with the current economic crisis, lowering investment potential and closing up lines of credit required to commission and continue installations and research in renewable energy.
  2. China has a fantastic infrastructure in place for renewables especially solar energy component manufacturing, as we know from previous articles.
  3. For the rest of the world, research has shown that developing countries with heavy reliance on fossil fuel and the fastest growing populations present significant investment opportunities for renewable energy. This is due to the constant increases in energy demand that comes proportionally with population growth and also the high comparative costs fossil fuels have in more remote, developing regions. Latin America is one prime example of this, as exemplified here.

Solar is a big winner from that graph so let’s look specifically at that. One of the main identified drivers of a specific technology taking off is the lowering in manufacturing costs. Solar power, especially photovoltaics, has seen unprecedented drops in it’s costs over the last two decades and this trend will continue by up to 60% from now until 2030. There is approximately USD $86 billion invested in solar technology development in 2011, but that figure is projected to rise to USD $150 billion by 2020 and continue at such a plateau until 2030. That means continued lowering in upfront capital required for installations of all sizes, and a fantastic growth margin over time.

Overall, renewable energy and Carbon Capture Sources accounted for some 23% of power generation in the world in 2010. By the time 2030 rolls around Bloomberg, PV-Tech and Energy Trend have different figures on what this will reach, but by and large an estimate of 33% is expected. Whilst the government incentives here in the UK have taken on a new level recently, this will not affect the upwards trend of the industry and solar as being a big part of that in the UK.

Written by Jarrah Harburn


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© 2011 Solar Selections Ltd


  1. Bloomberg New Energy Finance. (2011). Global Renewable Energy Market Outlook [Executive Summary]. Bloomberg New Energy Finance (1), Pg 1-6.


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