China, India, South Africa and Saudi Arabia set to become solar powers: Lux Research

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Greentech Lead Asia: China and India emerge as the most promising high-growth markets for solar PV modules, says Lux Research.

Global policy changes and the crystalline silicon module price crash have brought the solar industry to a pivotal point from which it must transform and thrive in a cost-conscious environment, targeting high-growth markets such as China and India, says Lux Research analyst.

While high-growth markets come with high risks as well, emerging economies of India, China, South Africa, and Saudi Arabia are set to become solar powers. Competition is booming in the last three in particular, and each will exceed installation targets.

“While some historically strong demand markets will continue to pay dividends, the real winners going forward will need to make a few well-informed bets,” said Matt Feinstein, Lux Research Analyst and the lead author of the report titled, “Past is Prologue: Market Selection Strategy in a New Solar Policy Environment.”

Solar farm

“Successful players will anchor business in key developed regions like the U.S., Europe, Japan, and China, and place informed bets in markets like South/Central America, the Middle East, and Africa, through new offices or partnerships,” he added.

Established markets like Europe remain fruitful for distributed generation despite downturns in demand and reduced feed-in tariffs. Markets such as Germany and Italy have demonstrated a strong preference for rooftop systems and have strong existing channels to market.

In solar, firms that take calculated risks and expand quickly into foreign markets will boost success, as First Solar  and many Chinese module manufacturers have shown. As the Chinese industry consolidates, opportunities exist for other global players, Lux Research said.

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