The BIPV Value Proposition28 Oct 2011 • by Natalie Aster
Building integrated photovoltaics (BIPV) is a new and dynamic market, with complex sub-markets, and very different market entities pulling diverse BIPV technologies into use. As an extension of the global photovoltaics (PV) market, both large established PV module suppliers as well as small niche architectural firms are trying to push BIPV into the market. Historically, the volumes sold of BIPV products—relative to PV products as a whole—have been low due to both a lack of demand and a lack of dedicated products for the building industry. However, NanoMarkets believes that the demand for BIPV would have been greater had dedicated products been more widely available.
As additional dedicated BIPV products are released to the market, we think that the key decision-makers are discovering new ways to add value to buildings. Ultimately, for BIPV to yield solid business opportunities, architects, builders, and roofers all must work with proven solutions, and proven BIPV technologies provide another way to win new customers/clients. Grid-connected BIPV is not just for "enthusiast" or "Green" people anymore, and "bankable" BIPV can now provide an attractive return-on-investment (ROI) for many buildings in many locations. Depending upon incentives and lease-back financing schemes, BIPV can potentially reduce the total costs of constructing homes and commercial buildings, and may also add significant value to building retrofits.
The combination of dedicated and bankable BIPV products with proper financing can open up new addressable markets. From the supply perspective, BIPV offers new revenue-streams for PV panel suppliers, and new differentiation in the market-space for architects, builders, and roofers.
Building Integrated Photovoltaics Markets 2011
Published: July 2011
Price: US$ 2,995.00
BIPV Market Drivers
Aesthetics: The first generation of BIPV systems was primarily architectural in nature. It consisted of attempts to make the PV panels more unobtrusive, by choosing thinner panels and installing them parallel to the roof surface or even hidden on a flat roof. In addition to helping PV appeal to a broader audience, the first generation of BIPV also was intended to meet the requirements of certain local governments, which have either mandated BIPV or required that PV panels be hidden from view, despite a lack of dedicated products designed to achieve these requirements.
These first-generation BIPV systems are not our primary concern in this report. Rather, we are more interested in BIPV products as opposed to BIPV design. The BIPV products we have in mind here are those that integrate smoothly with building surfaces. At a minimum, they are laminated on roofing or wall materials; more specialized products also serve as roofing or cladding themselves or even as skylights or other building features. Dedicated BIPV products, properly installed, simply look better to most observers than BAPV, and so provide a lasting value.
Costs: Inevitably, the cost of a BIPV system will be higher than a standard PV panel of a similar performance. Due to the dedicated design of second-generation BIPV systems, and the distinctly different sub-markets for roofs, windows, and sidewalls in buildings, any given BIPV product will see lower volumes compared to mainstream "utility panels" and will thus not enjoy the same economies of scale. However, with demand expected to steadily increase over the next eight years, NanoMarkets expects that BIPV products can be made on dedicated production lines and so will see steady reductions in manufacturing costs.
The ultimate goal for BIPV systems is that they can lower the total costs of construction of a BIPV-enabled building, since the cost of using BIPV materials will be lower than using conventional building materials in conjunction with conventional PV systems. However, for the BIPV market to establish itself what we are going to need to see in the next few years, is proof that this kind of economics can be established for BIPV. And this is where the opportunities lie. If costs for BIPV begin to reach the point where BIPV products can be positioned as part of a standard portfolio of high-end building materials then the demand is expected to explode.
Since cost remains a significant part of the demand equation, the dynamics of pricing must be considered. NanoMarkets considers that BIPV suppliers will target certain price-points in reference to existing high-end building materials and options. In such a scenario, the demand is not particularly "elastic" with price, but instead should spike up once threshold levels are achieved.
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