Floating Solar Market Set to Surpass 6 GW by 2031, Says Wood Mackenzie

Thursday, May 25, 2023

The global floating solar market is expected to pass the six-gigawatt (GW) threshold by 2031, as PV developers struggle to meet growing solar demand and look to alternate development technologies, energy intelligence firm Wood Mackenzie said in a report Wednesday.

“The global solar industry, including PV developers, continue to battle limited land availability and increasing land costs for ground-mount solar projects, which is driving demand for floating installations,” said Ting Yu, consultant at Wood Mackenzie, at SNEC PV Power Expo in Shanghai Wednesday.

According to Wood Mackenzie, floating solar is expected to have a steady market share compared to overall global solar demand, with the compounded annual growth rate (CAGR) for floating solar (FPV) expected to rise 15% in the next ten years. 

The company says that 15 countries are forecasted to exceed 500 megawatts (MW) of cumulative FPV installations by 2031, with Indonesia, India and China making up almost 70% of the total FPV demand in 2022.

“Despite development costs of FPVs ranging between 20-50% higher than comparable ground-mount projects, increased competitiveness in the developer and EPC landscape is helping to drive down costs in the sector,” Yu added.Credit: Wood Mackenzie

The Asia-Pacific region continues to lead the demand for floating solar

The Asia-Pacific market had approximately 3GW of floating solar projects in 2022, capturing over 90% of floating solar demand that year. Countries such as China, Indonesia, India, South Korea, and Thailand are developing multiple floating solar projects, according to Wood Mackenzie analysis.

In China, the floating solar project pipeline will grow at a steady pace going forward, with cumulative floating solar capacity to cross 13GW by 2031 at a 12% CAGR over the next 10 years.

“China will continue to lead in floating solar installations. The country has been able to utilise flooded coal mines that have been decommissioned to develop floating solar,” said Yu at SNEC.

Europe becomes second largest region for FPV demand

With almost 150MW, Europe is the second largest region for FPV demand, with the Netherlands in the lead followed by France. More countries are adopting the technology as multiple land use is being enforced in regions across Europe.

The Netherlands has the largest FPV project outside the Asia-Pacific region, representing 32% of Europe’s FPV market in 2022, helped by the Sellingen floating solar park (41.4MW) that came online in 2021. This reflects how project sizes are continually growing in Europe’s leading market.

“Although it is still a small market in Europe, the trend is positive, and bigger floating PV plants are expected in the near future. After 2025, slow growth is projected as the main spots would have already been developed at this point. In addition, grid constraints and higher LCOE for bigger plants means the technology is not competitive against rooftop PV,” Yu told delegates.

The US sees FPV growth

For the US, floating solar CAGR is estimated at roughly 13% over the next 10 years, where development is being driven in regions with high demand for solar but expensive land costs, including California, Florida, and New Jersey, Wood Mackenzie adds.

“Overall, the floating solar industry has seen high costs across all market segments, due to component costs and other soft cost increases, as a result of supply chain constraints in 2022. For instance, the rise in price for High-Density Poly Ethelene (from the pandemic) was the main driver of high SBOS costs for FPVs. Although the cost is expected to be lower as the supply chain expands,” Yu said.

 

Categories: Offshore Energy Industry News Activity Europe Asia Floating Solar

Related Stories

Reach Subsea Extends Olympic Taurus Charter and Orders Two ROVs

Vestdavit Hits New Sales Record as Orders Increase 76% From Last Year

Sulmara to Work on Site Characterization at Scottish Floating Wind Farm

Current News

First Gas Export to Denmark from Tyra II Expected Today

Vattenfall to Take Part in IJmuiden Ver Offshore Wind Tender in Netherlands

Beach Energy to Let Go 30% of Workforce Amid Strategic Review

Ocean Infinity Inks Deal with Shell for Subsea Data Capture Services

Subscribe for OE Digital E‑News