The solar industry is bounding out of 2019 and into a new decade with strong demand in Europe, the US, and signs of strength in emerging markets such as the Middle East. The last ten years brought the peak of the FiT era in Europe and its collapse, and Chinese domination of PV capacity and shipments.

The departing decade saw aggressive pricing or, as it really should be termed, dumping, from which the industry has never recovered to a margin-adequate price point.

The US imposed tariffs on imports of cells and modules from China in 2012, added Taiwan in 2014, and in 2018 US President Trump used the Trade Act of 1974 to impose 201 tariffs on many, many countries.

The decade saw a significant expansion of capacity to produce cells, as well as more than one period of consolidation. In 2019 alone, Panasonic took a step out of solar and semi-conductor manufacturing, China-based Hareon failed, and SunPower spun off its manufacturing into a new and separate public entity.

In 2019 monocrystalline blazed ahead of multicrystalline for a leading share of shipments. China became the leading market for solar deployment with over 50-GWp in 2017, only to soften in 2018, taking the industry to its first-ever year of shrinkage (shipments decreased by 5% in 2018 over 2017).

And now, 20 things to watch out for, expect, or dread in 2020:

  1. Expect more residential solar in California beginning January 1, 2020 as new building codes go into effect requiring solar on all new homes built in the state. The new rules also affect multi-family residences up to three stories (condominiums and apartments). Two downsides to the new rule – the construction industry is cyclical, and housing prices in California are through the, pardon, roof. As with everything, there are workarounds, houses with trees providing too much shading, and inappropriate roof structures are exempt.
  2. Expect continued downward pressure on prices from raw materials through to tender bidding and PPAs. High levels of cell and module inventory from 2019 will force manufacturers to keep prices low through 2020.
  3. In the US, watch out for more renegotiations of utility PPAs following the precedent set by PG&E. When it happens, remember how investor confidence was shaken following retroactive changes to FiT laws.
  4. Dread continued debt problems in China and watch out for attempts by the Central Government to control the crisis. High levels of debt from different sources may cause problems for China-based manufacturers, many of whom will fail if the debt propping them up comes due – and yes, this means even top tier manufacturers.
  5. Watch out for slowing, though still positive, shipment growth in 2020 as developers work off inventory acquired in 2019.
  6. In the US, watch for Congress to try and pass an extension to the investment tax credit but if it passes, don’t expect Trump to sign it into law.
  7. Expect remaining FiTs and subsidies for solar to migrate to tenders as governments look for ways to control costs.
  8. Watch out for more consolidation (a kind word for failing) under continuing price pressure. Manufacturers in Taiwan are at risk.
  9. Expect climate change to accelerate, but do not expect attempts to ameliorate it to accelerate.
  10. Expect demand to pick up in select Middle East markets driven by mandates and fulfilled by very low tender bidding.
  11. Watch for and dread more trade shenanigans sparked by the US and affecting all markets for solar globally.
  12. Expect stronger deployment of bifacial modules despite insufficient capacity along its value chain and no consensus on the value or, amount of the increase in electricity production. Watch for tracker manufacturers to battle over whose tracker is best. Expect to be confused.
  13. Expect a decline in the quality of bifacial modules and BoS components for same, as manufacturers rush product to market.
  14. Watch for P-type mono PERC to have the leading shipment share in 2020, with multi PERC lower, standard multi and mono plugging along, and n-type mono to be primarily a niche premium product. Expect the price premium for PERC to decline as capacity increases.
  15. Expect quarterly announcements of increased production and ongoing delays for Tesla’s solar tiles, the Godot of solar module products.
  16. Expect increasing quality problems in the field as cell and module manufacturers save margin on quality control and demand participants believing that low prices are too good to pass up buy, buy, buy.
  17. Watch for storage to become the driver for residential solar and dread the margin squeezing price drops this means for the storage industry.
  18. Expect installation quality problems in India to slow demand for new installations and for rebuilds and re-engineering to become a stronger business in that country. Also, expect the rebuilds to be counted as new installations so that no one knows how many megawatts or gigawatts were installed.
  19. In South Africa, expect Eskom to stop honoring PPAs and connecting IPPs again and potentially enter insolvency, leaving solar deployment in southern Africa in question for the utility’s home country as well as the seven other countries it serves including Namibia, Zambia, and Zimbabwe.
  20. Watch for a new industry to spring up developing technologies and businesses to ameliorate the effects of climate change. Invest in these companies when you see them, they are the future.