Solar Energy Systems Market SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024 - 2031)

Solar Energy Systems Market Size - Analysis

Solar Energy Systems Market Trends

With climate change becoming an increasingly pressing issue, many governments around the world have implemented policies to incentivize the adoption of solar energy systems. Providing subsidies and tax benefits has helped drive significant growth in the installation of photovoltaic panels on both residential and commercial buildings.

The push for clean energy has become a priority and governments are playing an active role in driving solar energy systems market transition through forward-looking policies.

As more countries commit to reducing dependence on fossil fuels and limiting environmental pollution, renewable sources of energy have emerged as an important long term solution. Solar power, being widely available across vast geographical areas, is seen as having huge untapped potential globally to provide clean electricity.

The current pandemic has also underlined the need for diversification of supply chains and building resilience at a regional level. Technological innovations are continuing to enhance efficiency and energy yields. So, the solar energy systems market is well positioned to lead the shift to cleaner sources of power on a global scale in the coming decades. The long term outlook for rising demand in the solar energy systems market therefore remains very positive.

Market Challenge - High costs associated with large-scale energy storage systems

Currently available utility-scale battery storage technologies like lithium-ion batteries are still quite expensive to deploy at the volumes required by solar farms. The high battery costs significantly increase the levelized cost of electricity from solar energy. Extensive research is ongoing to develop next-generation low-cost grid-scale battery chemistries, but those solutions are still some years away from commercialization.

One of the major opportunities in the solar energy systems market is the expansion of product services by key industry players. Leading solar panel manufacturers and project developers are increasingly offering innovative business models beyond the traditional energy supplier model.

It also allows industry players to diversify their revenue streams. This kind of business model innovation is expected to be a key driver of future solar energy systems market growth.

Key winning strategies adopted by key players of Solar Energy Systems Market

Focus on technological innovation: Companies like Tesla, Panasonic, and JinkoSolar have invested heavily in R&D to develop more efficient and cost-effective solar panel technologies. For example, Tesla introduced its Solar Roof product in 2016 that integrates solar technology into roof tiles.

Focus on emerging markets: Players like First Solar, Canadian Solar and Trina Solar have positioned themselves strategically in fast growing solar markets like India, Southeast Asia, and Latin America in the last 5 years.

Segmental Analysis of Solar Energy Systems Market

The solar panels segment contributes 43.3.% share in the solar energy systems market in 2024. This is owing to the growing demand for modular and flexible solar power generation options. As populations and economic activities rise globally, the demand for electricity continues to surge exponentially.

Monocrystalline and polycrystalline variants offer high performance in a compact format. The rising solar rooftop installation trend among commercial and industrial facilities as well as homes further stimulates demand. Government incentives and net-metering policies also encourage self-consumption of green power. All these factors contribute to solar panels dominating the product segment in the solar energy systems market.

Within the end-use segments, utility accounts for 67.1% share of the solar energy systems market. This is attributed to the increasing utility-scale solar projects being commissioned globally to cater to the bulk power needs of regions. As power distributors aim to diversify generation sources and reduce carbon footprint, huge solar farms are being set up through public-private partnerships or independent power producer models. Their large land requirements and megawatt-scale capacities make utilities the primary off-takers.

Within the solar energy systems market by source, new installation commands the major share owing to factors like operational lifespan and performance guarantees offered by original equipment manufacturers (OEMs). Performance of solar energy systems lowers gradually due to degradation of panels and other outdoor equipment from factors like weathering effects of heat, moisture, and UV radiation.

Meanwhile, optimized preventive maintenance ensures ongoing operation reliability but entails relatively lower investment than new builds. Need for periodic replacements once performance hit degradation thresholds underpins the larger opportunities in the new installation segment in the solar energy systems market. Proactive upkeep is nevertheless crucial to extract the designed lifetime output from solar assets.

Additional Insights of Solar Energy Systems Market

• Asia-Pacific dominated the solar energy systems market in 2023, contributing over 60% of revenue, driven by governmental renewable energy targets and investments in solar infrastructure.
• The utility segment captured over 67% of revenue share of solar energy systems market in 2023 due to its efficiency and carbon reduction capabilities.
• The U.S. added 14.1 GWh of energy storage in 2022, marking a 34% year-over-year increase, highlighting the rising importance of energy storage solutions.
• Lithium-ion batteries are gaining prominence for solar energy system storage in the solar energy systems market due to their high efficiency, energy density, and long lifespan.

Competitive overview of Solar Energy Systems Market

The major players operating in the solar energy systems market include Canadian Solar Inc., Sunpower Corporation, Tata Power Solar, Wuxi Suntech Power Co. Ltd., Abengoa Solar S.A., Bright Source Energy Inc., Gintech Energy Corp., Kaneka Corp., Acciona Energia S.A., and Esolar Inc.

Recent Developments in Solar Energy Systems Market

Solar Energy Systems Market Segmentation

• By Product
  • Solar Panels
  • Charge Controllers
  • Batteries
  • Inverter
  • Others
• By End Use
  • Utility
  • Commercial
  • Industrial
  • Residential
• By Source
  • New Installation
  • Maintenance, Repair, and Operations (MRO)