The Solar Industry Has Been Plagued by Low Demand and The Debt Crises in Europe and The US

The solar industry has been plagued by low demand and the debt crises in Europe and the US, the two largest solar markets. Industry sources indicated that incentive cuts are possible as the governments in Europe and the US try to solve the debt problems. Optimistic firms believe that by supporting the solar industry, the governments can lower unemployment rates, hence incentives may not see drastic cuts despite the weak economy. The supply chain has been experiencing weak demand and continuous price drops causing firms to hold conservative views for the future. The global economy plays an important role as the solar market partly depends on government incentives. Some firms believe governments in Europe will sacrifice the solar incentives in 2012 to save the economy, said industry sources. Solar PV system is not a necessity after all, they sources. Other solar firms believe the budgets for solar incentive programs have been set and could not be easily removed. In addition, to change the incentive policies with the fluctuations of the economy is not necessarily helpful because losing the solar industry means increasing unemployment rates, which will negatively impact the economy. Source: www.digitimes.com