Solar Thermal Market Size, Share, Growth Analysis, By Application, By End Use, By Collector Type, By System, By Region - Industry Forecast 2024-2031

Global Solar Thermal Market size was valued at USD 20 billion in 2022 and is poised to grow from USD 21 billion in 2023 to USD 30.6 billion by 2031, growing at a CAGR of 4.8% during the forecast period (2024-2031).

Solar thermal energy harnesses the sun's heat for various applications beyond electricity generation, unlike photovoltaic systems which convert sunlight into electricity. This technology, which can efficiently heat and cool spaces, heat water, and support cooking, has seen significant adoption. The European market rebounded post-COVID-19, with installations reaching approximately 2,146,901 m2 in 2019, reflecting an 8% increase from the previous year and a rise in thermal capacity to 1,502.8 MWth. The shift towards solar power as the leading renewable energy source is driving global installations of solar thermal power plants, notably with innovative solar district heating systems like Savosolar's in France. Government incentives, such as exemptions from grid fees for households using renewable heating, are accelerating market growth, enhancing the overall appeal of solar thermal solutions.

Top-down and bottom-up approaches were used to estimate and validate the size of the Global Solar Thermal market and to estimate the size of various other dependent submarkets. The research methodology used to estimate the market size includes the following details: The key players in the market were identified through secondary research, and their market shares in the respective regions were determined through primary and secondary research. This entire procedure includes the study of the annual and financial reports of the top market players and extensive interviews for key insights from industry leaders such as CEOs, VPs, directors, and marketing executives. All percentage shares split, and breakdowns were determined using secondary sources and verified through Primary sources. All possible parameters that affect the markets covered in this research study have been accounted for, viewed in extensive detail, verified through primary research, and analyzed to get the final quantitative and qualitative data.

Global Solar Thermal Market Segmental Analysis

Global Solar Thermal Market is segmented by Application, End Use, Collector Type, System and Region. Based on Application, the market is segmented into Hot Water Systems (Domestic, Large), Solar Combi Systems, Swimming Pool Heating, Others. Based on End Use, the market is segmented into Residential, Commercial, Industrial. Based on Collector Type, the market is segmented into Evacuated Tube Collector, Flat Plate Collector, Unglazed Water Collector, Air Collector. Based on System, the market is segmented into Thermosiphon Solar Heating System, Pumped Solar Heating System. Based on Region, the market is segmented into North America, Europe, Asia Pacific, Latin America and Middle East & and Africa.

Driver of the Global Solar Thermal Market

The momentum in the global solar thermal market is significantly driven by the increasing adoption of green energy, propelled by a heightened awareness of environmental issues and a commitment to reducing carbon footprints. Consumers and service providers are increasingly turning to clean fuels, spurred by the economic benefits and reduced reliance on fossil fuels. Government initiatives aimed at promoting renewable energy sources are crucial, as they provide incentives for electricity generation targets and the installation of solar thermal plants. With international goals set for 2030, 2040, and 2050 to enhance renewable energy's share in the energy mix, substantial investments in the solar sector are anticipated, fostering a competitive landscape. For instance, the growth trajectory of renewable energy in the U.S., where solar power capacity is over 100 GW, indicates significant potential for market expansion, especially as the nation strives to meet ambitious clean energy goals in the coming years.

Restraints in the Global Solar Thermal Market

The global solar thermal market faces several restraints that hinder its growth, primarily due to the high installation and maintenance costs associated with solar thermal power plants. Building these systems often requires significant land area that is ideally exposed to abundant solar radiation, which can be difficult to find. For example, a standard rooftop solar photovoltaic (PV) system can cost around $2,500 per kilowatt peak (kWp), with an average household needing a system that provides approximately 3kW, leading to total costs between $4,000 and $6,000 for around 21 square meters of roof coverage. Although installation costs are expected to decrease over time due to governmental support for renewable energy, the initial financial barrier remains a significant limitation for the market's expansion.

Market Trends of the Global Solar Thermal Market

The Global Solar Thermal market is witnessing a robust upward trend as industries increasingly embrace its advantages for sustainable energy solutions. Key sectors, including dairy food processing, beverages, automotive components, textiles, chemicals, and pharmaceuticals, are leading the charge in adopting solar thermal technology for industrial heat generation. The shift towards renewable energy not only reduces dependence on fossil fuels but also significantly lowers carbon dioxide emissions, addressing both regulatory pressures and corporate sustainability goals. With process heating representing nearly two-thirds of total energy demand in manufacturing, the potential for solar thermal adoption is substantial, particularly as pharmaceutical companies set ambitious energy efficiency targets and seek innovative solutions for cleaner operations.