The Total Addressable Market (TAM) for concentrated solar power was valued at USD 5.6 billion in 2022. It is projected to reach USD 46.12 billion by 2031, growing at a CAGR of 26.40% during the forecast period (2023–2031).
Concentrated solar power is a method of harnessing solar energy for electrical production by focusing the sun's beams to temperatures between 400 and 1,000 degrees Celsius using a system of mirrors. This energy is used in various applications, including heating fluid, which produces steam or hot air. The steam it creates is then utilized to turn turbines, which spin a generator, generating energy. While there are many different ways to collect solar energy, all rely on a heat engine driven by the sun's rays to produce electricity that is then supplied to the grid. Therefore, concentrated solar power generates zero carbon emissions.
Concentrated solar power is a viable carbon-free option for countries and regions with abundant sunlight. One of the primary anthropogenic drivers of climate change is the increase in atmospheric carbon dioxide from the combustion of fossil fuels like oil, coal, and gas or the felling and incineration of forests. As a result, the government is making different concrete efforts to expand the use of energy-efficient products and promote energy conservation at home or office, purchasing portable fuel canisters and using public transportation and renewable energy sources. Countries are rushing to fulfill their established targets for zero greenhouse gas (GHG) emissions while growing the share of renewable energy sources in overall electricity output, which has slowed.
Capital investment is required for the development of concentrated solar power. Solar tower systems consist of a heliostat field, power blocks, receiver fields, thermal energy storage, and a tower. Solar fields and heat transfer fluid systems are essential components in parabolic troughs. The IRENA reports that between 35% and 49% of the overall installed cost of parabolic trough technology projects is attributable to the solar field. Up-front investment expenses for concentrating solar power plants account for roughly 80% of the overall LCOE. As a result, this is the primary factor holding back the concentrating solar power industry.
There is a growing global push to sustainably increase the use of renewable energy sources like solar energy, which has led to a surge in interest in concentrated solar power technology. Greenhouse gas emissions can be decreased by using this technology, which is being adopted by several countries. As a result, this is opening up the lucrative potential for players in the market. A significant element driving the concentrated solar power market is the growing need for energy in a wide range of end-use sectors, as well as the efforts of industry stakeholders to lessen reliance on conventional energy sources in a wide range of countries throughout the world. European businesses in the concentrated solar power sector can also benefit from the growing public interest and government support for solar electricity.
The power towers segment is the highest contributor to the market and is expected to grow during the forecast period. The market for power tower technology is increasing, particularly in countries with ample land for construction, as power towers require vast spaces to operate. A significant element driving revenue growth in this category during the projection period is the rising popularity of solar power towers because of their many benefits, including lower operating costs, lower water usage, and increased thermal storage capacity. As a result, the linear Fresnel market is predicted to expand rapidly in the following years. Increased demand is due to improved design and the declining cost of glass mirrors. Additionally, its widespread adoption is mainly due to its affordable installation cost and straightforward assembly technique.
The utility segment is the highest contributor to the market and is expected to grow during the forecast period. Significant concentrated solar power project advancements in the MENA and Asia Pacific regions will decide the sector's future growth. Positive government initiatives and regulations aimed at expanding the use of renewable energy sources are expected to drive significant expansion in the utility sector throughout the projection period. In addition to storage technologies, the rising demand for renewable power generation is predicted to boost the industry. Increases in residential construction and energy consumption in emerging markets fuel the sector's expansion.
The global concentrated solar power market is bifurcated into four regions, namely North America, Europe, Asia-Pacific, and LAMEA.
Asia-Pacific is the most significant shareholder in the global concentrated solar power market and is expected to grow during the forecast period. Concentrated solar power for relieving grid sites is seeing increased investment in India, China, and Japan, which should lead to rapid market expansion in these countries. It is anticipated that the expansion of the market in the region will be driven by the expanding demand to create continuous renewable electricity energy to support rising fiscal activities. Several variables are driving the regional market; including components' low production costs, labor costs, and high solar irradiation levels. This region is experiencing rapid expansion thanks to several factors, including a growing demand for renewable power to keep up with the region's expanding fiscal activity.
Europe is expected to grow during the forecast period. Europe is currently the world's largest electricity generator using CSP technology, which is only expected to grow in the following years. Also, the expansion of concentrated solar power in the area is anticipated to benefit from the government's supportive policies. Spain is among the world's top CSP markets mainly due to its generous feed-in tariffs and other government-backed CSP programs. Spain's expanding need for storage space and the government's recent decision to impose tariffs on imported goods have also contributed to expanding the sector there.
The North American market leads the global market for concentrated solar power (CSP) in revenue. The demand for concentrated solar power has grown as more people learn about its advantages and shift their attention to this clean, green energy. North America's concentrated solar power market has been expanding for several reasons, including rising investments in implementing cutting-edge technology. Mainstream businesses are prioritizing the North American market for concentrated solar electricity.
Over the forecast period, the Middle East and Africa are projected to have the highest revenue growth rate in the global concentrated solar power (CSP) market. Rapid industrialization, increased air pollution, more government programs to combat air pollution, a strong emphasis on renewable power generation, and rising demand for greener, more sustainable energy is all contributing reasons to the expansion of the Middle East and African markets. The availability of vast desert terrains, the region's arid environment, and the rising installation of concentrated solar plants across the region, particularly in developed countries like the United Arab Emirates and Saudi Arabia, are also contributing to the expansion of the market. Morocco is one of the world's leading users of concentrated solar power. The region is set to expand thanks to persistently large expenditures in construction and a shift in investor attention toward green energy choices.
The global concentrated solar power market’s major key players are
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