According to a report published by ResearchAndMarkets, the global solar panel market is expected to reach a value of $273.15 billion by 2029 from $187.69 billion in 2023, growing at a CAGR of 6.45%.
The global solar panel market is highly competitive, with many public and private companies. These vendors typically compete on key parameters such as product design, quality, reliability, support services, and price. Rapid technological advancements adversely impact market vendors as consumers expect continuous innovations and product upgrades. The present scenario drives vendors to alter and refine their unique value proposition to achieve a strong market presence.
APAC accounted for the highest share of the global solar panel market in 2023 due to the presence of countries like China, Japan, South Korea, India, and other emerging countries, which are the manufacturing hubs for electronics. Also, the demand for solar panels in the region is driven by stringent regulations for emission standards, better fuel economy, and concerns over sustainability. Furthermore, the region is home to many recognized players and has a high level of technological improvement. The APAC solar panel market is driven by consumer demand for advanced products and services, and there is a substantial investment in R&D to support this demand.
Europe holds a significant share of the global solar panel market, driven by the growth in installation in new buildings and higher demand from renovations and retrofit activities. Major factors have spiked the sales rate for solar panels in Europe: rising average construction spending, increased retail building construction projects, rising government spending on sustainable building development, industrial developments, rapid urbanization, changing climatic conditions, and growth in disposable income across European countries. Also, in the North American solar panel industry, strong economic growth, the establishment of new businesses, company expansions, and increased construction activities have mainly driven the demand for solar panels.
Further, some of the major vendors dominating the global solar panel market include JinkoSolar, Canadian Solar, Trina Solar, SunPower Corp, Hanwha Q Cells, Aiko Solar, LONGi Solar, Risen Energy, Kaneka Corporation, and Shell International Ltd. These brands have many product offerings and a widespread presence in the global market. The major vendors are adopting innovative technologies to retain their strong market position.
MARKET TRENDS & OPPORTUNITIES
Advancements in Solar Technology
Solar panel technology has made massive strides that have made it easier to acquire solar panels. Efficiency has become a part of the specifications consideration, which means current panels produce more electricity from the limited sunlight that always falls on the panel's surface. Manufacturing methods have improved, reducing costs and lowering the economic barrier to entry, enabling more people to invest in solar power. Silicon solar cells dominate the market and have undergone continuous refinement and improvement.
Advances in silicon wafer manufacturing, such as developing monocrystalline and polycrystalline silicon cells, have increased cell efficiency and reduced production costs. Also, new advancements in solar panel technology increase market demand by making solar energy more efficient, durable, affordable, and versatile. As these technologies evolve, they will be critical in accelerating the transition to a clean, sustainable energy future. Furthermore, innovative designs, applications, and supportive government policies and incentives have further accelerated the growth of the solar panel market.
Growth of Green Building Activities
A green building creates structures using environmentally sustainable and resource-efficient processes throughout the building's lifecycle, from siting to design, construction, operation, maintenance, renovation, and deconstruction. Green buildings are also known as sustainable and high-performance buildings. Solar panels are an effective way for a building to meet its sustainability standards.
These solar panels can provide abundant eco-friendly energy resources, reducing or eliminating the need for electric consumption. As a result, solar-powered buildings contribute to green building certifications, such as LEED (Leadership in Energy and Environmental Design) and BREEAM (Building Research Establishment Environmental Assessment Method), by meeting criteria related to energy efficiency, renewable energy use, and environmental performance.
INDUSTRY RESTRAINTS
High Initial Cost
Raw materials constitute the largest cost component in the manufacture of solar panels. Moreover, raw materials account for 50-60% of the overall cost of the final products. The prices of major raw materials, such as glass, plastic, timber, and aluminum, used to manufacture solar panels have increased significantly over the past few years.
The volatility of raw material prices seriously threatens vendor profit margins in the solar panel market. Other operating expenses, such as labor costs, have risen steadily over the past few years. Adding to all these costs, cheaper and cost-effective solar panels and modules made by Chinese and other international manufacturers have harmed the profits of the major market vendors. All these factors burden vendors who have strived to produce affordable and value-added products to cope with the intense market competition.
MARKET DYNAMICS
Market Opportunities & Trends
- Profit Volatility in APAC
- Market Dynamic of APAC
- Regulation on Energy Efficiency Driving Solar Panel Demand
- Advances in Solar Technology
- Rise in Commercial Construction and Projects
- Rising Demand for Clean Energy
Market Growth Enablers
- Growth of Green Building Activities
- Incorporation of Solar Panels in Rooftop
- Increased Construction in the Hospitality Industry
- Favorable Government Policies and Incentives
Market Restraints
- High Initial Cost
- Raw Material Price Volatility
- Turbulent Global Political and Trade Relations
SEGMENTATION
Segmentation by Type
- Monocrystalline Solar Panel
- Polycrystalline Solar Panel
- Thin-film Solar Panel
- Bifacial Solar Panel
- Others
Segmentation by End-user
- Commercial
- Utilities and Energy Companies
- Industrial
- Residential
- Agriculture Sectors
- Military and Defence Sectors
- Others
Segmentation by Power Capacity
- Small-Scale Solar Panels (< 10 kW)
- Medium-Scale Solar Panels (10 kW - 100 kW)
- Large-Scale Solar Panels (100 kW - 1 MW)
- Utility-Scale Solar Panels (>1 MW)
Segmentation by Installation
- Rooftop Solar Panels
- Ground-Mounted Solar Panels
- BPIV
- Others
Segmentation by Grid Type
