Hello I'm Rob Barnett a senior clean energy analyst at Bloomberg Intelligence. And today I want to walk you through our twenty
twenty two outlooks for the wind and solar industry. Let's start with some good news for us. The solar industry is going to grow
15 to 30 percent this year. In our view this will be the first year that global installations exceed 200 gigawatts of capacity.
Now this follows. Very robust growth in 2021. The final year and numbers aren't quite in yet but it looks like demand grew more
than 25 percent last year as well. When on the other hand is a little bit more of a mixed bag when
you look at 2022 and 2023. Expectations are that we could see a dip in overall installations mainly due to supply chain
disruptions and high commodity prices. The wind industry has really been struggling because of the run up in steel costs. We
are seeing some easing there. And so the real question for the wind industry this year is whether they can eke out a modest
profit amid stagnant installations and higher commodity prices. Now looking forward we're quite optimistic about both the wind
and solar industry. So if you look at our medium term and long term demand scenarios we're really maybe just at the tip of the
iceberg in terms of the amount of clean energy technology we're going to be installing each year. In fact if you look at the IEA
is net zero scenario wind and solar demand are poised to grow something like 3 X or 4 X over the coming 10 years. Very
staggering growth. And many of the net zero policies really haven't been enshrined into law yet. So whether it's a build
back better in America or all sorts of policy and stimulus around the world we see those as potential catalysts to really
help signal that the industry is going to grow quickly. And again solar is really already growing at a pace consistent with
the net zero thinking wind. Not quite so yet but I would say if you look at the European turbine makers that Siemens Gan Mesa
Vestas and Nordics on a combined basis they grew the turbine installations by a quagmire of 17 percent in 2017 through 2020.
So we know they can grow fast. It's just about making sure the demand is there. Now why has. All of this clean energy been
happening. Well one of the big pieces of this story is the tremendous decline in costs we've seen over the last decade.
Solar panels have fallen essentially over 90 percent since the start of 2010. It's a very staggering development that really
helps to underpin the economics. Many people are still thinking that policy is important and I'm not saying it's not. But at the
end of the day the economics really work almost on their own at this point that wind and solar have the cheapest level ISE costs
of energy of any of the technologies that you could look at and especially cheaper these days compared with natural gas. Given
the run up in prices or coal we think longer term prices could continue to fall particularly if we see an easing of commodity
prices. Polysilicon one of the key inputs to the solar industry has had a big run up over the last 12 months just in steel as
well. So if these things ease we see prices continuing to come down which will help the development further this decade. Now if
you're interested in companies that are exposed to this theme of robust clean energy demand high demand for when high demand for
solar you can check out our theme baskets by visiting the ISE Wind Dashboard or solar dashboard.
There are numerous companies in many markets that have exposure to the kinds of demand growth that I've just described to you.
And by the way while you're there check out First Solar. They're a company that we have a focus idea on for 2020 too.
It's one of the 50 companies we've nominated to watch this year. And basically our thesis is that they're growing very quickly
and they have potential to deliver above consensus results particularly on the revenue line next year as they bring new
factories in Ohio and India online. Thank you for your time.
Check out our research on the wind and solar industry by visiting VIX.