We’ve often noted that the declining price for solar photovoltaic (PV) modules has continued to drive global growth in solar installations, even as governments reduce or eliminate various subsidies and tariffs to encourage new solar power. In 2012, new solar PV installations totaled 31,100 megawatts, up from 30,400 megawatts in 2011. Cumulative global solar PV capacity now stands at just over 102,000 megawatts.

Interestingly, Europe accounted for 55% of global installations last year, the largest single portion. However that total fell from 74% of new installed capacity in 2011. Total new installations in Europe also fell, from 22,400 megawatts in 2011 to 17,200 megawatts in 2012.

Germany installed 7,600 megawatts in 2012 to lead all countries in new solar installations. China installed an estimated 5,000 megawatts, Italy added 3,400 megawatts, the U.S. added 3,300 megawatts, and Japan added an estimated 2,000 megawatts. The data comes from the latest report of the European Photovoltaic Industry Association (EPIA).

In a business-as-usual scenario, the EPIA estimates that over the next two years the growth of the non-European markets will not expand quickly enough to compensate for the slowdown in Europe. Even under this relatively negative outlook, however, the global market could grow to as much as 48,000 megawatts in 2017. Total installed capacity under this scenario could reach about 288,000 megawatts by 2017.

Under a more policy-driven scenario, total solar PV generation by 2017 could top 84,000 megawatts, with two-thirds of the growth coming from outside Europe. Total installed capacity under this scenario could reach more than 420,000 megawatts.

The rooftop market, which accounted for about two-thirds of 2012 installations, will give way to much larger utility-scale projects by 2017. Of an estimated 81,000 megawatts of new capacity in 2017, 48,000 megawatts (about 60%) will come from utility-scale projects.

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