- Australian solar capacity rose 33 percent to 20,000 MW in 2020
- ‘The COVID-19 pandemic had an overall positive impact on the [solar] Industries than people who stay at home turned more to the solar industry to cut their electricity bills. “
- Large commercial solar energy projects are ongoing in NT and WA
Australian households and businesses installed record-breaking 5,000 MW solar power systems in 2020, equivalent to 15 million average solar panels. The trend will continue through 2021.
This additional capacity is enough to power 1 million households and brings Australia's total solar power generating capacity to 20,000 MW, a 33 percent increase from the capacity of 15,000 MW in 2019.
“The annual growth rate for solar roofs has exceeded 33 percent in the past four years and accelerated in 2020,” said Warwick Johnson, managing director of SunWiz, a solar energy consultancy.
Several factors are driving the uptake of solar energy in Australia, including households' desire for energy independence, environmental concerns and the trend to work from home.
“In fact, the COVID-19 pandemic has had an overall positive impact on the [solar] The staying-at-home industry turned more to the solar industry to cut their electricity bills, “said Johnson.
Last summer's widespread bush fires also alerted people to the problem of energy self-sufficiency, and rising electricity costs have encouraged ideas about energy efficiency.
Exceptional time for the solar industry
The solar industry has bypassed the COVID-19 pandemic, which poses its own challenges in terms of device shortages from China, lockdowns on installation stops, and economic uncertainty.
“It's an exceptional time to be working on the roof anywhere in the Australian solar supply chain, and things will only get better if solar system prices continue to hit record lows and emissions reductions to fight climate change gain momentum,” said Johnson of SunWiz .
There is still a long way to go before the solar industry in Australia supplants established fossil fuel power generation sources such as coal, gas and diesel.
Solar energy generated just 5.3 percent of Australia's electricity in 2019, and 2.5 million Australian households have solar panels installed on their roofs, according to the Clean Energy Council.
Large solar-related battery storage projects are underway in Australia as state governments work towards zero carbon emissions targets with initiatives such as the 14,000 MW SunCable project in the Northern Territory and the 26,000 MW Asian renewable energy hub in WA .
Alice Springs, the outback city that is the gateway to Uluru in the Northern Territory, has been selected for a two-year $ 9.3 million renewable energy project, partially funded by the federal government.
Strong trend reversal in the outlook for the solar sector
The buoyant Australian solar energy market marks a sharp turnaround from business conditions just a year ago when the industry struggled.
Bloomberg estimated that new Australian solar systems were down 40 percent in 2019, while they were up 14 percent globally.
At the beginning of 2020, Downer (ASX: DOW) announced that due to the market uncertainty no more solar modules would be built.
“Developers, contractors, and bankers all struggle to grapple with the risk of large blackout factors, network stability issues, connectivity issues, and device performance issues,” said Grant Fenn, Downer CEO.
Small caps trying to crack the solar market found it a difficult task.
In 2019 ReNu Energy (ASX: RNE) got out of the solar industry and sold its assets to the private company CleanPeak Energy.
The solar sector is entering a strong growth phase
Suffice it to say that the ASX solar companies that held the course through the tougher times are now well positioned for the growth phase of the market.
A small cap is still in solar New Energy Solar (ASX: NEW)who invests in solar projects worldwide.
Infigen Energy (ASX: IFN) has a handful of solar projects, three in Queensland and one in New South Wales.
Another is the varied energy game MPower (ASX: MPR) (formerly known as Tag Pacific), which builds solar panels as well as battery storage systems.
In November 2018, the company received the order to build panels for the planned Pirie Solar Farm in South Australia.
Genex Power (ASX: GNX) also built a solar project and received a $ 132 million grant from the Queensland government.
After all Windlab (ASX: WND) specializes in wind projects but has an integrated project at Kennedy Park that includes solar energy.
Technological advances are driving the solar sector
The Australian Renewable Energy Agency (ARENA) announced in October a $ 3 million funding from Australian startup SunDrive for its rooftop solar panels, which use copper instead of silver.
According to ARENA, solar power plants currently account for 20 percent of the world's annual silver consumption.
“This poses an ongoing supply risk as solar demand grows and will be exacerbated as the industry shifts to next-generation, higher-efficiency solar cell structures that require two to three times more silver per cell,” the agency said.
ASX share prices for Infigen Energy (ASX: IFN), Genex Power (ASX: GNX), New Energy Solar (ASX: NEU), M Power (ASX: MPR), ReNu Energy (ASX: RNE), Windlab (ASX: WND ))
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