The Australian solar market faces a protracted downturn

Jun 18, 2015

he Australian Solar industry has seen ups and downs, to the point of being described as a 'sola-coaster'. But now it is confronted by a protracted downturn, the likes of which it hasn’t seen before – to the point where four out of five months in 2015 have been lower than every month since January 2012.

Indeed, May 2015 was the worst May for REC registration since 2010. Overall, volumes are 20% down on last year – 245 megawatts has been registered in the first five months of the year, compared to 310MW the same time last year.

 

 

 

Queensland and South Australia have been hardest hit. Queensland had registered 105MW of installations in the first five months of 2014; this year it sits at 80MW.

SA registered 48MW over January-May 2014 but only has 27MW in the same period in 2015.

 

The declining volume is creating immense pressure in the solar industry. Many installing electricians have pulled-back from solar, returning to sales of other electrical equipment. 

But the marketplace is still overcrowded. Intense competition has driven prices to unsustainable lows, making it difficult to make a profit. Meanwhile, fat-walleted electricity retailers who will swallow years of loss-making solar business segments are looking to enter, command and dominate the market.

Thankfully there are islands of opportunity – where there is commercial PV there is growth. The NSW market is growing because of its focus on commercial PV, even as the residential market there contracts.

Queensland on the other hand has been over-reliant on residential PV, and is now suffering because of it.

Source：Business Spectator