n-tech Research has witnessed the progression of Building Integrated Photovoltaics technologies, products and suppliers in the BIPV market over the past eight years where it now needs to be sold with an emphasis on aesthetics and its multi-functionality aspect.
The assumption behind our latest report is that the technology is evolving to blend function and form, alongside and in place of conventional construction materials. In other words, we are conjecturing that over the period considered in this report, BIPV will migrate to being a more mainstream and widely accepted technology.
BIPV – A Business Model for Distributed Renewable Power
The huge cost and small return from building giant baseload power stations have encouraged power companies to support the use of solar panels and other forms of sustainable distributed energy forms. If end users widely adopt solar panels it is believed by some that power companies can put off building large power stations thus saving considerable amounts of money.
From the customer’s perspective, however, the situation is a little different. Solar panels are still quite expensive and most end users rely on subsidies before adopting them. However, this may not be enough. While there are those who like solar chic, in many cases, simply mounting solar panels on a roof is regarded as aesthetically unpleasing. In some areas this kind of “raw” deployment of solar panels may also run afoul of local building codes or can be unacceptable to building owners.
BIPV was designed to solve this issue, but until recently has done so only to a modest degree. In its first incarnation, it consisted of little more than architectural redesigns that made fairly standard solar panels less conspicuous. Since those times, there have been attempts to productize BIPV products, either through (1) products that can be especially easily added to buildings or (2) products that were some kind of integration between a solar panel or roofing product.
Despite these apparent innovations, however, BIPV doesn’t seem to have gone far commercially. For the most part it has foundered because of low investment in distribution chains and/or a sort of half-heartedness about marketing. It has also suffered from huge spurt in Chinese market share of the solar panel industry which, until quite recently, tended to favor solar solutions that are not especially innovative.
Given all this, it is understandable that the construction industry has been reluctant to fully embrace BIPV. The position of the construction industry and architects has been reinforced by the absence of believable warranties.
Resurrecting the BIPV Industry
So one has to ask, are there now just too many negatives surrounding BIPV to give it a chance at resurrection? n-tech’s tentative answer to this question is no. There are three reasons to think this.
Strong business proposition: Our first line of argument here is that the basic business proposition surrounding BIPV—that it is needed to broaden the addressable market for PV—remains as strong as ever. That is, BIPV combines all the advantages that one associates with solar panels with great architectural aesthetics.
How this advantage can be exploited commercially remains the central question for BIPV and certainly hasn’t been settled yet. Nonetheless, BIPV has (at least) a theoretical advantage in the solar panel space that is hard to argue with.
BIPV continues to fit with the policy zeitgeist: The solar boom of a decade ago was largely policy driven with subsidies at almost every government level pushing the solar industry forward. As a result, customers were presented with a way to obtain energy at less than the current market cost of grid-supplied energy. This made sense in geographies where grid-supplied energy was very expensive. This would include most of Europe and the northeastern part of the United States.
BIPV was carried along for the ride. Although initially BIPV was not technologically advanced to do well in the market, it could (as it were) bask in the reflected glory of solar as a whole and this helped to both create and push BIPV businesses. The solar boom turned to bust in part because subsidy regimes became much more conservative after the 2008 worldwide recession and this hurt BIPV as well as the conventional solar panel market.
As far as policy issues, n-tech does not believe that we are ever going back to the heady days of ubiquitous subsidies and we may even see some more declines. However, the policy environment in Europe is more stable (at least in the next few years) than it has been for some time and any cutbacks at the federal level in the US will be positively balanced by state actions on subsidies.
Such policy stability will benefit BIPV as it does the conventional solar panel business. However, we think that BIPV may benefit from the current policy regime especially. For one thing, there appear to be special subsidies for BIPV in some places that seem to be in place. However, more generally we think that BIPV will do well in the current environment because messaging of the aesthetic advantages of BIPV can offset any subsidy declines. Such messaging cannot be carried out for conventional PV. In addition, regulation that favors zero net-energy building tends also to favor BIPV.
Technological promises: The belief that BIPV would transition from c-Si to TFPV, DSC and OPV because the flexibility of these newer materials has not proved justified. Thus, c-Si continues to dominate BIPV with a little participation of CdTe (because of the presence of First Solar) and a-Si. c-Si and a-Si has come to dominate BIPV in part because most of the Chinese solar panels that are now being used ubiquitously are primarily c-Si. c-Si has also come to dominate because no other solar material can offer the same efficiency.
This is not to say that there will be no important technological change in the BIPV space in the future. However, we don’t expect technology to be the power behind new business opportunities for some time to come. When positive technological change does arrive in the BIPV space, we expect the largest impact to come from (1) transparent PV which facilitates integration with lighting and smart windows and (2) wall-based BIPV based on DSC/perovskites.
The Future of BIPV
Given all of this, n-tech believes that there is a good chance of a revival of BIPV, with this re-birth being prompted by strong messaging on style and aesthetics. We suspect that such messaging will be achieved by larger firms with big advertising budgets. Until very recently the hope here was Dow, but this company has dropped out of the BIPV business. However, hope in this space has been revived by Tesla, which also has the advantage of being a “chic” company—something that Dow is not.
Large companies in the BIPV space may also be able to work wonders in building supply chains. But this is not necessarily always the case. For example, Dow had established channels into the construction industry but Tesla doesn’t
Also positive for the future of BIPV is the addressable market for BIPV considered from its geographical aspects. We expect the Chinese market for PV (including BIPV) to grow over the next decade as the Chinese government tries to battle pollution. In addition, we expect to see India, Malaysia, South Africa, the Gulf States and (perhaps) Brazil provide new demand in the BIPV space.
