Growth forecasts for the solar energy sector in 2022

As the world continues to deal with the effects of the ever-evolving coronavirus pandemic, markets and consumers continue to adjust. Despite its resilience amid this global issue, the solar industry also has to deal with Covid in its own way. This will accordingly impact growth in the foreseeable future.

For instance, growth forecasts for 2022 are down as a result of global uncertainty about the various circumstances. These include increased costs for manufacturers and developers, as well as continued stresses on supply chains. For this reason, these issues have been affecting global markets for the greater part of the past couple of years.

Heading into next year, what are the key growth areas that the solar industry needs to focus on? What lessons from the past couple of years can it use for 2022?

Managing growth expectations

To begin with, the more moderate forecasts for next year don’t mean solar energy didn’t have a relatively solid 2021. It just means mindsets are being tempered to account for the likelihood of further constraints. This applies to both the industry and consumers. Belt-tightening on the part of buyers is still obviously a concern. Furthermore, an increase in production and development costs will dampen enthusiasm to some extent.

Nevertheless, the industry largely expects to see good growth. In the US, installations continued to rise through the third quarter of this year. In fact, that momentum is likely to continue heading into 2022. This is despite sweeping price hikes of key materials, especially where utility-scale solar projects are concerned.

Dealing with market dynamics

As explained, solar energy suffered from fluctuating market conditions, just like any other sector. This applies to all segments of the solar power industry: utility-scale, commercial, and residential. In fact, the latter two felt the most impact. In the US, deployments in those segments went down in the third quarter. Even the relatively strong utility-scale segment was susceptible to price spikes because of market factors.

The main requirement for solar this coming year is to continue increasing deployments and solar capacity. With continued government support as well as legislation aimed at stimulating the economy, the growth forecast is still possible.

Navigating around shifting market factors—especially ones beyond companies’ control—will be even more important in 2022. Most people thought the worst was over until more recent omicron corona case surges sent markets spiraling again. Disruptions like this might be part of the foreseeable future until we find the definitive fix to this Covid problem.

Will slower industrial growth affect viability?

Hopefully, the solar energy industry will be able to buck the trend despite the many hardships of these challenging times. Maintaining conscious awareness of the great benefits solar provides can definitely keep the sector sustainable. An important plus is the rapid rate at which solar power technology is developing. Continued improvements should increase viability and help offset any cost spikes.

Solar companies will certainly hope to exhibit the same kind of resilience in 2022. The world is trying to regain its footing and learn to live with Covid long-term. All the industry can do now is work on improving and innovating its products and hope to deliver the goods.

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