IHS Markit has made a significant upward revision to its forecast for solar PV installations in 2017, now predicting global installations to reach 90 GW – a 14% increase from 2016.

According to a research note from IHS Markit analyst Josefin Berg, the biggest changes are seen in China, where a combination of positive revisions to policy support, a larger-than-previously-anticipated first-half of the year, and strong installations activity continuing into the third quarter has moved IHS Markit to raise its forecast for installations in the country to 45 GW in 2017.

Based on analysis of official connection statistics, as well as inverter and module shipments, IHS Markit estimates that 26 GW of installations were completed in China in the first half of this year and a further 12 GW will be installed in the third quarter.

Previously, it was predicted that Chinese installations would peak in the second quarter before declining in the third quarter due to the grace period allowing projects to receive the 2016 feed-in-tariff ending on July 1. However, IHS Markit says recently released PV connection data from the China Electric Council (CEC) reported that 34.9 GW of PV had been connected in China by the end of July (11.3 GW in July alone), indicating that installations had in fact continued into July and the third-quarter decline will be far softer than previously anticipated. IHS Markit’s revised forecast for installations in China in 2017 assumes that this official connection figure may not include several gigawatts of projects that may have been installed but not connected at the end of that period.

However, IHS Markit says this exceptional boom in demand in China has consumed a huge proportion of the global PV module supply, leading to increased prices and lead times that now extend into 2018. The latest installation forecast implies that the PV module supply chain is at the very upper end of what it can produce within a year. In reality, the final number of module shipments for 2017 is likely to be limited by the supply of polysilicon, IHS Markit adds. As a result of the tight supply, projects are being delayed and the short-term outlook in regions such as Japan, India and Latin America has been reduced. IHS Markit has cut its forecast for installations outside of China in 2017 by 7 GW.

Notably, IHS Markit says the outlook in the U.S. is not as heavily impacted as in other regions because the current rush to procure modules ahead of any potential trade action resulting from the Suniva trade petition focuses on securing tariff-free modules manufactured outside of Taiwan and China, which are unlikely to be used to serve demand in the China market.