Growth of global solar projects slows to 8%: BMI

This was due to trade policy risks.

Global solar projects have increased by about 8% in the past six months, albeit slower than the 15% recorded in December 2023, according to a report by BMI.

“Previously, we noted a project pipeline of 2,530 solar power projects, an expansion of 400 projects from recorded project in end-May 2023. From end-December 2023 to end-May 2024, this project pipeline expanded once again to about 2760 projects, albeit at a much lower rate,” it said. 

The latest number does not include projects that were completed, cancelled, or suspended. 

BMI said the slower growth may be associated with trade policy risks. Tariffs imposed on imported solar components, and uncertainty around international trade agreements also increase costs and discourage new investments in new project developments, it added. 

The emergence of rooftop solar installations also plays a role in this complex dynamic, BMI said.

“As residential and commercial entities increasingly adopt these systems for their energy needs, there has been a shift in focus away from large-scale solar farms. This trend reflects consumer preference for decentralised energy solutions and the benefits of self-sufficiency, but it also impacts the rate at which large-scale projects are developed and announced,” it explained.

BMI said its Key Projects Data (KPD) show that 109 gigawatts (GW) of large-scale solar projects will come online in 2024, which is 37% less than its forecast. 

This lag may be due to projects being delayed coming online this year and the uptake of distributed solar, it noted. 

“We believe that net solar capacity additions in 2024 will reach about 298GW. This is nearly triple the capacity additions expected based on our KPD,” BMI said. 

It noted that 389 of projects with a capacity of about 109GW are expected to be commissioned before the end of the year, 14 of which account for just over 6GW already completed as of end-May 2024.

“We attribute most of this difference to additional smaller scale and distributed solar PV capacity in the markets and regions,” BMI said.