Malaysia could become the third largest producer of solar cells after China and Germany once related projects are completed next year.
The country’s aspiration is to increase its market share to 17% of world production and reach number two position behind China by 2020.
Under the Economic Transformation Programme (ETP), Malaysia will use its its current capabilities in producing semiconductors advantage to go into the solar industry.
It indicated that similarities in the solar and semiconductor value chain can help the country latch onto the global solar growth.
Malaysia has a strong starting position in solar. The country already has companies across the entire value chain.
To reach this goal, Malaysia needs to increase its cell and solar wafer production capacity by 10 times and silicon production capacity by 23 times by 2020.
Despite astronomical costs compared to oil, coal and other renewable energy sources, the global solar market has grown by 50% between 2005 and 2010.
This year, the global solar market is expected to hit 10 gigawatts in yearly supply and rake in RM160bil in revenue.
While solar is currently expensive, average installed system prices have dropped to about RM16.40 per watt.
Prices are expected to fall further to RM6.70 per watt or lower in 2020.
The solar market is expected to grow at 30% per year until 2015 and drop to 25% until 2020.
If solar’s energy share among renewable energies reaches its forecast of 5% in 2020, this will translate into global cumulative installed capacity of 560 gigawatts.
By then, an annual demand of 113 gigawatts will bring RM918bil of revenue in 2020, where Asia will drive a significant portion of the demand and supply in 2020.
