Europe, with over 65% market, holds a leading share in the global photovoltaic (PV) market in 2010. Germany with 43% share would be the world leader in PV market. USA will have 18% while Japan will have 5% share. Though Japan and North America increased their market share in 2010, there is not enough demand in those regions to ameliorate a collapse of demand in Europe. The rest of the World would have only 11% market share in 2010. EU countries like Germany, Italy and Spain, will claim 85% market share in Europe by 2010. According to a report by iSupply, installations of PV systems in the United Kingdom will amount to 96 Megawatts (MW) in 2010, spiking by 1500% from 6 MW in 2009. Expansion will dramatically outpace the growth of the next fastest-growing nation Spain - which will rise by approximately 730% in 2010. UK has adopted attractive Feed-in-Tariffs (FIT) to promote PV adoption. Furthermore, with leading solar country Germany cutting its FITs, the focus of the PV world is shifting to places with more favorable incentives. While growth in UK is expected to slow down after 2010, PV installations will continue to rise at approximately 50% per year through 2014. iSupply's predictions on the UK PV market are shown in the chart below. High manufacturing costs have limited the growth of photovoltaic (PV) market. The global financial meltdown of 2008 and 2009 took a toll on the new developing market of photovoltaic for solar energy. Q4-09 has brought cheer to the suppliers. The industry has consistently demonstrated its ability to cut costs, resulting in technology development and new material testing to reduce costs and improve conversion efficiency. According to a recent study by the European Photovoltaic Industry Association (EPIA), based on the current pace of progress in technology and installation volumes, the cost of PV electricity is expected to decline 8% each year, halving generation cost every 8 years. New material development, advancements in high performance polymers (PMMA, silicones, EVA, polyamides, fluoropolymers, etc.) will play a major role in bringing down the cost as they form an integral part of Photovoltaic systems, where they find application in various components including encapsulants, backing sheets, frames, sealants & adhesives, thin film substrates, glazing, Fresnel lenses, and photoactive components in organic photovoltaic. The PV industry is made up of solar survivalists who know that the odds are against them and so struggle to bring down costs and preserve incentives, sometimes by making promises that are extremely difficult to keep simply because the PV industry is a business, and margins must be maintained in order for R&D to continue, efficiencies to rise and costs to decline. There is a faint likelihood of a crash in demand in 2010, despite significant upcoming changes to various European feed-in tariffs. A more likely outcome is that the pressure of increased capacity will continue forcing ASPs and margins downward, giving manufacturers out of China an advantage. Although China has announced more flexibility of its currency against the dollar and there are indications that wages in China will increase (making the country a less attractive point of manufacture for companies based in Europe and the US), it is unlikely that these overheads will rise to the point that China loses its existing competitive advantage. As of mid-year 2010, manufacturers from China/Taiwan are on track to again lead other regions in shipments. In 2009, manufacturers from China/Taiwan shipped 46% of the total manufactured capacity. In 2010, this will likely increase to more than 50% and means that such manufacturers will control cell and module ASPs for some time. Despite an expected 65–67% increase in shipments to the first point of sale in the market (the first point of sale is defined as demand here), 2011 will begin with significant inventory on the demand side of the market. Figure 2, shown above, presents estimated metrics for 2010, based on accelerated shipments/demand of 13.1 GWp. The current industry practice of rolling around 2 GWp of inventory from one year to the next will help continue to depress module prices, along with excess capacity, and the expected slow decrease of feed-in tariff support. Given the economic turmoil of the previous year or so, it is perhaps surprising to see iSuppli Corp dramatically upgrade forecasts for installations of PV systems in 2010. A surge of sales in Germany combined with plunging prices are set to boost solar demand in 2010, with solar installations rising to 13.6 GW in 2010, up 93.6% from 7 GW in 2009. The strong rise in PV installations in 2010 will be driven by robust market conditions in the second and fourth quarters, which will more than compensate for slower performances in the first and third quarters. Q1-2010 was negatively affected by winter conditions, likely causing a decline in installations compared to Q4-09. However, Q2 is expected to be a blockbuster for the global PV industry with reduced feed-in tariffs in Germany in July and consumers. A market correction will happen in the Q3-10, leading to a huge Q4 due to the approach of other countries' FIT deadlines in January 2011. Growth in H2-10 will be driven by reductions in the cost of solar installations, compensating for the FIT reductions, resulting in a favourable return on investment (ROI) for homeowners and project developers. In some cases, the ROI will remain higher than 10%. Due to a swinging volatility in the quarters in 2010, the PV supply chain and production planners will struggle to figure out how much is needed, where it is needed and when is it needed. This could result in material supply constraints during the year. Spot shortages of inverters, and perhaps panels, could curtail growth to some degree. Looking ahead to 2011, there could be more supply constraints - unless additional expansions take place, crystalline-Silicon (c-Si) modules could encounter constraints in 2011 with utilization rates for c-Si module production facilities anticipated to climb to more than 90% in 2010. Nonetheless, despite the short-term supply challenges, the outlook for global PV installations remains bright. By 2011, global PV installations will rise to 20.3 GW; nearly triple the 7 GW in 2009.