Solar Market Synopsis: January
Each year about this time, SunWiz sits down for a few days brainstorming with Nigel Morris (Solar Business Services) in which we gaze into a crystal ball and forecast how much solar power will be installed in Australia over the next five years. Last year the crystal ball was clouded by the inevitability of a roll-back of feed-in tariffs and a severe reduction in solar multiplier, which at one stage we feared could have crippled the solar industry. Whether paradoxically or ironically, the reduction in government incentives unleashed a Solar Tsunami, to the point where SunWiz is confident that 1 GW has been installed in 2012. When held up to the sun, our crystal ball for 2013 reveals a mixed story, with hope for some and disappointment for others. Government incentives for PV can’t really get lower, but this doesn’t mean the worst is over.
The headline bad news is that we expect the solar market will contract in 2013. Most people active in today’s solar industry haven’t experienced an overall market contraction (though those in NSW know how painful it can be) , but were it not for Premiers Newman and Bailleau 2012 might have been far smaller. The life might have been sucked out of the industry by 2012’s incentive-driven solar surges, but anecdotally there’s plenty of evidence that new buyers are “keeping up with the Jones’” in sufficient volumes to soften the blow. We expect that the market contraction won’t be as bad as it might once have been… for the market has shown itself to be both resilient and creative; the low barriers to entry have spurred both high competition and will inevitably deliver some new business models that will re-shape the industry. Businesses will experiment with new sales channels, financing models, technologies, and some will be successful. However, any contraction will still result in more losers than winners and it will (now more than ever) pay to be “sun smart”.
And in spite of overall market contraction, some sub-markets will grow – the key strategic challenges for PV businesses is therefore how to identify, target, and convert the growth markets, and to open up new markets. Commercial PV will be one of these markets, but its overall volume won’t be enough to sustain – don’t put all your eggs in that basket. Residential PV (once recovered from the January doldrums) will finally provide some degree of stability, hopefully in sufficient volume to keep businesses cashflow positive while they tackle strategic jobs and opportunities. Financing will provide access to new customers, but will need to be cleverly crafted to differentiate itself. One of the key challenges on the horizon are those of increasing market penetration. Saturation still seems a fair way off, but marketing efforts will increasingly need to avoid the wastage of reaching customers who have already purchased. Solutions that minimise exports and address network issues will be a challenging but ultimately highly-rewarding offering for the companies that bring and package the right product to market at the right time.
How does the future look, and which are the key sectors and states of opportunity? We’re not able to release figures yet, suffice to say the future looks brighter for owners of SunWiz and SolarBusinessServices 5-year forecast, due for release soon.
Synopsis: December
PV Market
- Last month saw 70MW of PV registered across Australia, a volume that would have been higher except for Christmas break.
- SolarChoice system price data showed an across-the-board price-increase following the multiplier elimination, but part of the cost was absorbed; and part offset by a higher STC price.
- Our 2012 market wrap reveals that the top 10 PV retailers account for less than one-third of the PV market.
- Our new interactive service allows PV companies to quickly perform SWOT analysis on any of the top 200 market players.
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STC Market
- STC creation has been quite low; particularly from the largest PV retailers.
- However, there was a high volume of tradings that occurred last week.
- Our 2012 wrap shows the top 50 STC creators, holders, buyers, and sellers of 2012, plus the best weekday to sell STCs.
- The weekly and monthly STC creation tally are displayed on our website – check in regularly.
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Solar Hot Spots
Our SolarHotSpots service now includes analysis of your company’s solar hot spots. Identify where your market growth is outstripping the market, so you can replicate your greatest success? Subscribe to Solar Hot Spots.
PVsell News
We’ve made the following additions to PVsell over the last month:
- PVsell subscribers have now created over 1100 projects, with excellent feedback of high-conversion rate
- We have helped demonstrate how quickly PVsell can ‘vet’ potential leads, so you can concentrate on real customers.
Want to be more strategic? Subscribe to PVsell.
SunWiz Activities
In the last month, SunWiz has:
- Contributed to Green Energy Trading’s STC Forecast for the Clean Energy Regulator
- Prepared Operations Manuals for eight large PV systems for a project developer
- Helped improve the grid connection requirements (and costs) for a frequent connector of 30+ kW systems.
- Assisted the APVA with the development of a great new source of solar information
- Prepared information for the CEC’s Clean Energy Australia report
- Hold my first meeting as Chair of the PV Directorate of the Clean Energy Council
- Taken home a puppy named Sunny, who has already demonstrated innate Solar Intelligence (see photo below)
Some brands are able to be retrofit to existing systems regardless of the inverter, some only work work with the same brand of inverter, and some are all-in-one units that replace your existing inverter. The most common solutions currently available in Australia are:
- Selectronic SPPro: can be retrofit to an existing system, though combining with a Kaco grid-connect inverter enables additional features including enhanced battery utilisation and greater configuration. Can perform grid demand management and export control. About 7000 units already deployed.
- SMA Sunny Backup: available in 8kW, 44kW, and 110kW units, compatible with SMA grid-connect inverters. About 3000 units already deployed.
- Nedap Power Router (distributed by SETEC) – an all-in-one unit (options 3kW, 3.7kW, 5kW) with or without storage that is currently available and looks great.
- Zen Residential Freedom Powebank – about to go into production, provides 14-20kWh of energy storage, allows grid support (network controlled discharging).
- Sol-Ace Sun-Sink and Grid Demand – currently being produced and available in 5 & 10 kWh units, with prices starting from $3000.
Market Synopsis
PV Market
- January saw 76MW of PV registered across Australia, a similar figure to December
- Though Queensland is rapidly shrinking, half of Queensland installations are now post-Solar Bonus Scheme.
- The average system size is now 3.5kW, and is again on the rise in NSW and WA. 1.5kW systems are only installed in 10% of cases.
- In the few months of its operation, Greenough Solar Farm has already generated more solar electricity than all other LRET-creating solar systems combined.
- Our new interactive service allows PV companies to quickly perform SWOT analysis on any of the top 200 market players.
Want more information? Subscribe to Insights.
STC Market
- 7.4M STCs were surrendered in the Q4 2012 surrender period. This still left over 20M STCs available for Q1 2013 surrender, plus whatever is created in the coming months.
- The government has still not yet announced the STC target for 2013, though the STC price has risen
- Our Q4 surrender wrap shows the volume of STCs surrendered by each liable entitiy. .
- The weekly and monthly STC creation tally are displayed on our website – check in regularly.
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Solar Hot Spots
Now there’s no solar multiplier, where should you target your sales? This information could help:
- Four postcodes in NSW had bumper fourth-quarters, with installation rates higher than ever before.
- The top NSW postcode in Q4 was in the Northern Rivers – but one Tasmanian postcode installed nearly as much.
- Bundaberg’s new solar panels will be clean – over 1.6M installed in the last quarter.
- My favourite place in Victoria had cumulative growth of 25% in the last quarter.
Want more information? Subscribe to Solar Hot Spots.
PVsell News
Geoff Bragg of New England Solar Power said of PVsell “I don’t know what you did, but for me PVsell is now faster than ever before. Confirmed a sale of a 90kWp system on a University College this week on the back of PVsell analysis”
We’ve made the following additions to PVsell over the last month:
- Tranferred to a faster, more reliable Australian web server.
- The addition of a monthly production graph, which meets the CEC design requirements at time of quoting
- The ability to override our performance calculations
- The ability to download graphs, and to email results directly to customers
- Integration of disclaimers on your printouts
- Finer control over what staff members can and can’t change in PVsell.
- We have helped demonstrate how quickly PVsell can ‘vet’ potential leads, so you can concentrate on real customers.
Want to be more strategic? Subscribe to PVsell.
SunWiz Activities
In the last month, SunWiz has:
- Prepared the system design of a 500kW ground-mount solar farm
- Prepared the system design of 100kW and 50kW systems as part of a tender
- Assisted the APVA with the development of a great new source of solar information
- Commenced work on the program review of the National Solar Schools Program
- Ghost written two articles for publication in the newspaper, and one on a blog
- Prepared O&M Manuals for seven commercial installations
- Assisted with the grid connection process of multiple 50kW installations
- Prepared the forecast of installations over the next five years (with Nigel Morris)
- Assisted as an expert witness of a legal case
- Survived three days without power
