INDUSTRY INSIGHTMARKETS TO WATCH

Vir idium Associates recently conducted an anonymous sur vey of solar and wind

professionals based in Europe, the USA and Asia to find out where they felt the

next big market will be, both in the next 18-24 months and longer term. The

sur vey was conducted online over a 4 week period in August 2012, and was

completed by 64 respondents.

THE SURVEY

RENEWABLES MARKETS TO WATCH

THE FINDINGS

WHICH DO YOU SEE BEING THE NEXT BIG MARKET FOR RENEWABLES IN

THE NEXT 18-24 MONTHS?

Asia 52.9%South America 36.8%USA 25.0%Europe 17.6%

Africa 11.8%

The majority, 52.9% predicted the next big market to be Asia, with South America

following shor tly after. When asked to justify their market choice, a respondent

who had select Asia explained that… Global renewable electr icity production

will grow by some 40% in the next five years to up to 6,400 TWh by 2017,

according to a repor t released by the International Energy Agency (IEA) today.

The fir st edition of IEA’s Medium-Term Renewable Energy Market Repor t 2012

estimates that green power production will increase by 1,840 TWh between 2011

and 2017, with countr ies out of the Economic Co-Operation and Development

(OECD) bringing two-thirds of the expected growth. The maturing of green

energy technologies, mostly thanks to policy suppor t and market frameworks in

OECD countr ies, helps for the r ise in green power output, IEA explained. At the

same time, surging power demand and energy security needs in the past years

have driven the installation of renewable sources in many emerging markets. As

much as 710 GW of renewable power capacity is expected to be added in the

repor ted period. China will account for some 40% of that, while the US, India,

Germany and Brazil are also seen to make large capacity additions, according

to the repor t. The repor t studies 15 key renewable energy markets, which

nowadays account for some 80% of the global renewable energy production. It

also identifies developments that may ar ise in other impor tant markets.

The United States, unfor tunately, is not sold on renewable energy as a whole and is still dependent on fossil

fuels for power production. With the upcoming election taking place in the US the PTC, which has been

a driving force behind renewable energy growth will end in 2012 and this has caused companies to focus

their attention elsewhere in the wor ld for expansion potential. Asia, especially China, is full stem ahead with

renewable energy construction and growth as well as India. South America is coming into its own with wind

and solar energy construction as a new market.

India has moved from a subsidy regime to incentive suppor t linked to productivity. Despite the removal of

accelerated depreciation benefit, reduction of power banking to almost nothing and removal of several tax

concessions to wind energy components, investments in wind energy have continued to grow year on year.

(2) De-centralized power is a demand in several developing countr ies like India and SA where power

transmission infrastructure is expensive and has implementation difficulties due to dispropor tionate cash-

flow.

(3) India, China and Brazil have huge technical potential for renewables in the upwards of 50GW yet to

be utilized. These are largely untouched due to Capital and infrastructure issues. However, with emerging

technologies access to these capacities may become more viable .

ANOTHER EXPLAINED…

ANOTHER RESPONDED…

Brazil has abundant resources for biomass production including a thr iving sugar industr y; Fur thermore, the

Brazilian economy is stable and growing in contrast to neighbouring economies and the growing economy

means growing demand for energy. Given some of the fuel constraints that Brazil faces with traditional

fossil fuels, they are a r ipe market for renewable energy; China - China’s rapid growth has led the nation

ANOTHER ANSWERED…

LONGER TERM WHERE DO YOU SEE BEING THE NEXT BIG

MARKET FOR RENEWABLES?

Asia 61.8%Africa 38.2%USA 35.3%South America 26.5%

Europe 14.7%

The majority, 61.8% predicted the next big market to be Asia, with

Afr ica second.

WHEN ASKED TO JUSTIFY THEIR MARKET CHOICE, ONE

RESPONDENT EXPLAINED THAT…

Global investment in renewable energy has grown rapidly in recent

years, dr iven by concerns about climate change, the increasing cost

of fossil fuels and national economic policies to create jobs. Looking

forward, global investment in renewable energy projects will r ise

from $195bn in 2010 to $395bn in 2020 and to $460bn by 2030,

according to Bloomberg New Energy Finance analysis.

Over the next 20 years this growth will require near ly $7 tr ill ion

of new capital. Over this period renewable sources, including large

hydro, will increase their share of total pr imar y energy production

from 12.6% in 2010 to 15.7% in 2030.

The share of non-hydro renewable resources will increase from

10.3% to 13.2% over the same period The next 10 years will

see a steep climb in investment as countr ies rush to meet their

2020 renewables targets. In addition, much of the spend in 2018-

to explosive growth in energy consumption (now the 2nd largest

consumer of fossil fuels after the US). China is also one of the

wor ld’s largest manufacturers of solar panels and wind turbines.

With easy access to renewable technologies, centralized planning,

and a r ising demand for energy, China will be a major market for

renewables. UAE - With massive growth of urban development in

UAE, a focused expor t on fossil fuel production, and a regime that

is intent on keeping up with international technological growth,

UAE will grow to be a pr ime market for renewables.

ANOTHER ADDED THAT…

Longer term, India will see a major upsurge in renewable

energy, especially in the form of distr ibuted power

generation. This is due, in par t, to increasing unreliability

of their gr id and a r ise in economic growth and

industr ialization. The Indian public utility lacks the trust

of its constituency and the gr id is yielding more instances

of large scale failure . This will lead to a expansion of

renewable energy, both at the utility level, but also as

the level of distr ibuted power. The US market is slow to

the par ty, but given increasing awareness of the benefits

of renewables, as well as the availability of different

technologies, the US market with begin to expand its

renewable offer ing. Fur thermore, increased regulator y

environment, especially dr iven by the public ser vice

commissions, will dr ive utilities to be more and more

involved in expanding the renewable energy por tion of

gr id power deliver y

20 will be in the more costly offshore wind projects,

in par ticular in Germany and the UK. Expenditure on

renewable energy projects is likely to dip temporarily

in the ear ly 2020s as countr ies review their longer-term

objectives, and digest the effects of the rapid expansion

in renewables over the previous years

Combining traditional ethical values with cutting edge techniques, Vir idium Associates offers a full range

of recruitment ser vices to established, high growth and star t-up organisations across the globe within the

energy and engineering sectors with a specific focus on renewable energy.

Our teams have established an enviable reputation for researching, sourcing and deliver ing the ver y best

talent in the market for our clients within budget and to deadline. With our experience and exper tise in

specialist recruitment ser vices and our passion for the arenas we work within, Vir idium Associates match the

best talent with the most rewarding oppor tunities across ever y corner of the ear th.

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