Solar PV Balance of System - Global Market Size, Technology Review, Cost Analysis, and Key Country Analysis to 2020

Wednesday 17 December 2014, Amsterdam

China Continues to be Largest Market for Solar Balance of System 

In 2013, with a sharp increase in capacity addition, China overtook the US to become the largest market for solar Balance of System (BOS). Having added 11 Gigawatts (GW) in capacity, it is estimated that China will again have the largest market for BOS in 2014. At $6.82 billion, China’s BOS market accounts for 20% of the global BOS market. The US BOS market accounts for 19% of the global BOS market.  The following chart shows the share of the global BOS market size held by each of the key countries covered in this report.

Decline in Hardware-Component Costs in India

India has a domestic content requirement for solar Photovoltaic (PV) but is restricted to cells and modules. The components of BOS can be sourced from outside the country without affecting the government incentive. Most of the inverters that are used in India are imported from European countries, but structures are supplied by several Indian companies at competitive rates. However, a number of developers import structures or purchase their installation as a service from companies outside of India, for reasons varying from lower cost to better and faster installation. Cables and transmission components are also of mixed sourcing. While some components are mostly purchased from domestic manufacturers, others are almost entirely imported. The following chart shows how the costs of all hardware components have displayed a declining trend in India between 2010 and 2014. This has hugely influenced the fall in overall BOS cost in the country, in spite of rising labor rates.


Germany’s Market to Decline but Manufacturers to Continue Producing 

Following the increase in annual capacity addition, the BOS market increased from $9.2 billion in 2010 to $11 billion in 2012. However, with a sudden fall in annual capacity, the market fell sharply to $4.4 billion in 2013 and $2.3 billion in 2014. With the government putting a limit on annual capacity by limiting incentives, the BOS market size is expected to decrease slowly from $2.5 billion in 2015 to $1.3 billion in 2020. However, manufacturers will continue production in order to cater to the export market. The following chart shows the BOS market size in Germany between 2010 and 2014 and the estimated market size between 2015 and 2020.