Bifacial solar modules have attracted a lot of market attention in recent years. Installed capacity grew from only 97 megawatts globally in 2016 to over 2,600 megawatts in 2018.
That number will double by the end of 2019 to reach 5,420 megawatts, according to Wood Mackenzie Power & Renewables' first report focused on the global bifacial market. That will bring the global cumulative bifacial solar capacity to over 8,200 megawatts. Furthermore, between 2019 and 2024, the size of the bifacial market is poised to increase tenfold.
The driving forces behind the growth differ from region to region, but one unifying factor is the growing affordability of bifacial modules. The WoodMac study found that the production cost differential between bifacial mono PERC and monofacial mono PERC module is now as low as half a cent.
It helps that it's relatively easy to retool existing monofacial module production facilities to manufacture bifacial modules, which provides supply certainty should the market demand the product.
Together, the comparable production cost and the ease of supply buildup are allowing bifacial modules to compete with conventional modules and gain market share.
The value proposition
Unlike conventional monofacial solar modules, bifacial solar modules can generate electricity from both the front and the back sides of the panel, increasing the energy yield.
Many advanced commercial solar cells are inherently bifacial, which means that the electricity generation from the back side comes with little additional cost at the cell manufacturing level, and a marginal increase on the module assembly level, to allow the back side of the panel to access sunlight.
As a result, solar projects built using bifacial modules would generate more electricity than monofacial module projects of the same size, have a lower levelized cost of energy and provide higher economic returns.
Forecast of Global Annual Installed Bifacial Solar Capacity, 2019-2024E (MWdc)
The bifacial module market has seen growing pains. The new technology is experiencing the same challenges that today’s mature renewable energy technologies like wind and solar faced in the 2000s: It has not accumulated enough long-term field data to demonstrate its real-world performance under all conditions.
Five-year outlook: An embrace of bifacial modules
WoodMac predicts annual global bifacial module capacity will exceed 21 gigawatts by 2024, accounting for 17.2 percent of the total installed capacity in that year, quadrupling the share of bifacial solar in 2019.
Regionally, China has traditionally been the flagship bifacial market thanks to the country’s Top Runner program, which incentivizes the deployment of new technologies. Going forward, WoodMac finds that the Chinese bifacial market will continue to grow but at a slower rate of 20 percent a year, as the country adapts to the subsidy-free system.
The U.S. bifacial solar market, meanwhile, is poised for significant growth due to the Section 201 tariff exemption on imported bifacial solar modules. For a long time, the U.S. solar market has faced a module supply shortage, caused by many tariffs on module imports and the country's small domestic manufacturing scale. As a result, the prices of solar modules in the U.S. are 40 to 50 percent more expensive than those in European countries and Australia.
However, the bifacial module tariff exemption announced by the Office of the U.S. Trade Representative in June 2019 will bring much-needed relief to the module supply chain in the U.S. Because of the exemption, bifacial solar modules made in Southeast Asian countries will gain significant price advantage (given that they incur no import tariffs of any kind).
This will have a profound impact on the technology preference of U.S. developers, especially those in the utility-scale business. Bifacial module installations in the U.S. will experience sustained growth in the next five years, expanding from just over 500 megawatts in 2019 to over 2,000 megawatts in 2020, and rising to more than 7,000 megawatts in 2024.
The Middle East, too, is expected to see a significant level of bifacial adoption. The region’s sandy terrain makes it a good host for the bifacial technology. Oman, a rising solar star in the region, has a 600-megawatt bifacial project pipeline. The UAE is also an early adopter, having announced a 320-megawatt bifacial project in June 2019. Saudi Arabia is expected to see an increase of bifacial solar capacity, given the country’s rapidly developing solar sector.
State-run large-scale tenders in Brazil, Mexico and Chile will drive the growth in Latin America. Similar mechanisms will drive bifacial development in Egypt and Africa.
Northern European countries will continue to see bifacial adoption due to the region's high latitude. The U.K. and Denmark have over 150 megawatts of projects in their pipelines. Although the fast-growing Southern European market has not seen a clear preference toward bifacial modules, the region’s fast-growing solar installations, driven by both policy and market conditions, offer a welcoming environment for bifacial solar to prove its potential.
Finally, Australia leads the pack in Oceania, thanks to its bifacial-friendly desert terrain in the middle of the country and the high electricity tariffs that originally spurred solar’s growth.
Nevertheless, risk factors exist, and they could hinder the global adoption of bifacial solar modules. A global economic recession could slow down the progress of solar market development in general, and policy uncertainty surrounding the longevity of the U.S. section 201 tariff exemption also presents a challenge to manufacturers’ capacity planning and could limit the market size of bifacial solar in the United States.
Industry efforts to increase bankability
The development of international standards, testing procedures and modeling tools tailored to bifacial modules is still in progress. A lack of real-world data and standards contributes to temporary uncertainties about the bankability of bifacial modules and solar projects that use them.
As a result of this, risk-averse financial institutions are not yet rushing to embrace bifacial modules projects on a large scale.
However, the industry is beginning to develop standards to self-regulate, increase credibility and further improve technologies’ bankability. The Wood Mackenzie Power & Renewables study highlights the progress made to date to collect field data, enhance bifacial-ready simulation software programs, and develop industry standards and certifications.
If the history of wind and solar development is any indication, through accumulating real-world data to prove performance and improve bankability, bifacial solar modules will win the trust of the investment community and achieve significant global market share.
Xiaojing Sun is the author of Wood Mackenzie's first report on global bifacial market growth, Global Bifacial Module Market Report 2019.