Solar Power Equipment Market: Increasing Awareness of Renewable Energy, Decreasing Solar Panel Costs Boost the Market Growth

Solar Power Equipment market was valued at USD 121.78 Bn in 2023 and is expected to reach USD 245.9 Bn by 2030, at a CAGR of 10.56 % during the forecast period.
Solar Power Equipment Market Overview
The solar power equipment market is integral to the broader renewable energy sector, playing a critical role in harnessing solar energy. This equipment is essential for converting the sun's energy into usable power, which significantly contributes to the reduction of carbon emissions and, by extension, the mitigation of global climate change. In response to increasing global energy challenges, such as the depletion of fossil fuel reserves and the urgent need to curtail greenhouse gas emissions, many international organizations are actively developing innovative solutions. These solutions focus primarily on the implementation of renewable energy technologies, among which solar power stands out due to its scalability and efficiency.

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The push towards renewable energy sources is driven by the need to manage and reduce current levels of carbon dioxide emissions while also preparing for future demands and potential environmental impacts. This has led to enhanced focus and stringent measures aimed at expanding the deployment of renewable energy sources like solar and wind power. The solar power equipment market is poised for significant growth as it responds to the dual demands of environmental sustainability and energy cost reduction, ensuring it remains at the forefront of the transition towards a greener, more sustainable energy landscape.
Solar Power Equipment Market Dynamics
Growing environmental awareness fuels demand for solar power equipment as shift from fossil fuels accelerates.

The growing awareness of the environmental impacts caused by conventional fossil fuels such as increased greenhouse gas emissions and air pollution has significantly driven the solar power equipment market as the public and policymakers push for cleaner, renewable energy alternatives. Technological advancements have made solar energy more cost-effective, while governments worldwide, through initiatives like the EU's increased renewable targets and the U.S.'s Inflation Reduction Act, are bolstering the market with economic incentives. Additionally, corporate commitments by major companies like Google and Amazon to operate entirely on renewable energy, along with a surge in consumer demand for sustainable energy solutions, are propelling the adoption of solar technology. These factors collectively underscore a dynamic shift towards solar energy, fuelled by both environmental concerns and economic opportunities. This multifaceted drive is propelling the solar power equipment market forward, offering both environmental benefits and economic opportunities, and signalling a transformative shift in how energy is produced and consumed worldwide.

Global climate commitments and sustainability goals propel adoption of solar power systems

The commitment to combat climate change, as highlighted in the United Nations' Sustainable Development Goal 13 (SDG 13), is a major driver for the Solar Power Equipment industry. SDG 13 promotes urgent measures against climate change, which facilitates the adoption of renewable energy like solar power to reduce environmental impacts and carbon emissions. A key manifestation of this commitment is the European Green Deal, which sets ambitious targets for renewable energy and energy efficiency with the goal of making Europe climate-neutral by 2050. This deal supports solar energy through increased funding, subsidies for technological innovation, and streamlined regulatory processes, thereby stimulating investment and lowering costs in the solar sector. The result has been a significant increase in solar installations in European countries such as Germany, Spain, and France, aligning with a broader trend of shifting investments from fossil fuels to renewable energy sources. These policy initiatives are reshaping the energy market, aligning it with sustainability goals and accelerating the adoption of solar power, with ongoing impacts expected to deepen the role of solar energy in achieving a sustainable and resilient global energy future.

Government incentives, including tax credits and subsidies, significantly boost the adoption of solar power equipment market globally

Government initiatives around the world are crucial in enhancing the adoption of solar power, contributing significantly to the growth of the solar equipment market. These initiatives typically manifest as financial incentives designed to reduce the financial burden for both residential and commercial entities interested in adopting solar energy. These incentives include tax rebates, grants, and subsidies, which collectively make the installation of solar power systems more economical and enhance the potential return on investment. A prime example of such incentives is the United States' federal solar tax credit, also known as the Investment Tax Credit (ITC). This policy allows individuals and businesses to deduct 26% of the cost of installing a solar energy system from their federal taxes. This deduction significantly lowers the initial cost of solar installations, thereby making solar energy more accessible and economically appealing. The ITC has been a pivotal factor in the expansion of the U.S. solar market, facilitating a widespread increase in solar system installations across the nation.



S No.
Issuing Date
Issuing Authority
Name of the Policy
Short Summary


1.
06.10.2022
Ministry of New & Renewable Energy
Extension of Phase-II of Grid Connected Rooftop Solar programme
Phase-II of Grid Connected Rooftop Solar programme is further extended upto 31.03.2026 without any finincial application.



Although the ITC was originally going to end, it has been extended several times because it works well and shows the government's ongoing support for renewable energy. This approach is mirrored globally, with numerous countries implementing similar incentives to encourage the adoption of solar power. Examples include feed-in tariffs in Germany, where producers are paid a set rate for the electricity they generate using solar power, and solar incentives in India that include capital subsidies and cheaper financing options.

Schemes in India



2.
24.08.2022
Ministry of New & Renewable Energy Grid Solar Power Division
Scheme for Solarisation of sun-temple town of Modhera, District – Mehsana, Gujrat
The Ministry of New and Renewable Energy (MNRE) has unveiled a plan to achieve 100% solarization of Modhera, a town in Gujarat's Mehsana district, known for its historic Sun Temple dedicated to the Hindu Sun God. This initiative is designed to meet all the domestic and agricultural electricity requirements of Modhera's households exclusively with solar energy. This pioneering project aims to serve as a model for powering an entire village or town solely through solar energy.


3.
30.09.2022
Ministry of New & Renewable Energy Grid Solar Power Division
Production Linked Incentive Scheme (Tranche II) under ‘National Programme on High Efficiency Solar PV Modules.
The Government has awarded 11 companies with the rights to develop a combined solar PV module manufacturing capacity of 39,600 MW under the Production Linked Incentive Scheme for High Efficiency Solar PV Modules (Tranche-II), committing a total financial outlay of Rs. 14,007 Crores. This initiative anticipates the activation of 7,400 MW capacity by October 2024, followed by 16,800 MW by April 2025, and the remaining 15,400 MW by April 2026. The second tranche of this incentive scheme is projected to attract investments worth Rs. 93,041 crores and is expected to create a total of 1,01,487 jobs, with 35,010 in direct employment and 66,477 in indirect employment roles.



These global initiatives are fundamental in moving the world towards renewable energy adoption. They not only promote environmental sustainability but also foster economic growth by creating a robust market for solar technologies. Thus, governmental policies play a major role in driving the adoption of solar energy, underscoring the impact of strategic policy support on technological adoption and market development in the renewable energy sector.
Solar Power Equipment Market Segment Analysis
Based on Equipment Type, The Solar panels segment is expected to be the fastest-growing in the solar power equipment market during the forecast period. Solar Panels segment holds the largest share, accounting for 34% of the market in 2023, and is expected to continue leading the market during the forecast period. Solar panels are the most commonly used component in solar power equipment, renowned for their ability to provide clean, emission-free electricity. These panels generate direct current (DC) electricity and are essential components of solar photovoltaic systems, which also include inverters to convert DC into alternating current (AC). Solar PV panels are manufactured using photovoltaic cells, similar to the material used in computer chips, making them a crucial element in solar technology. The solar power equipment market is poised to play an essential role in the global transition towards renewable energy sources, underscoring its importance in meeting environmental goals and achieving a sustainable future.

Based on Application, the market is segmented by Residential, Non-residential and Utilities. The Utilities segment is the largest, accounting for 54% of the market share in 2023. This segment leads the market, primarily due to an increase in power purchase agreements (PPAs) between electricity boards and private sector companies. These agreements are set to further boost the implementation of solar energy solutions within the utility sector, reinforcing its position as the dominant solar power equipment market segment.


Solar Power Equipment Market Regional Insight
The Asia Pacific region held the largest market share accounting for 33.9% in 2023. This region's market dominance is due to the surge in demand driven by numerous planned and ongoing solar power projects across Asia Pacific. Additionally, the solar power equipment sector is poised to benefit from robust government initiatives and substantial funding dedicated to promoting clean, renewable energy sources. These factors collectively are expected to propel the growth of the solar power equipment market in the region.

In North America, the market is expected to experience substantial growth, with an expected CAGR of XX% during the forecast period. This growth is supported by initiatives from the US Department of Energy and the Electric Power Research Institute, which are actively funding solar energy projects for utility applications. These efforts are significantly enhancing the adoption of solar power equipment. Meanwhile, in Europe, the European Energy Research Alliance is playing a vital role in increasing market awareness and the production of solar energy. The growing utilization of solar energy within the region further stimulates the growth of the industry, aligning with broader energy transformation goals.
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Solar Power Equipment Market


Report Coverage
Details


Base Year:
2023
Forecast Period:
2024-2030


Historical Data:
2018 to 2023
Market Size in 2023:
US $ 121.78 Bn.


Forecast Period 2024 to 2030 CAGR:
10.56%
Market Size in 2030:
US $ 245.9 Bn.


 Segments Covered:
by Application
Residential
Non-residential
Utilities


by Equipment Type
Solar panels
Mounting
Racking & tracking system
Storage system



Solar Power Equipment Market, by Region
North America (United States, Canada and Mexico)
Europe (UK, France, Germany, Italy, Spain, Sweden, Austria and Rest of Europe)
Asia Pacific (China, South Korea, Japan, India, Australia, Indonesia, Malaysia, Vietnam, Taiwan, Bangladesh, Pakistan and Rest of APAC)
Middle East and Africa (South Africa, GCC, Egypt, Nigeria and Rest of ME&A)
South America (Brazil, Argentina Rest of South America)
Leading Solar Power Equipment Key Players include:
1. First Solar, Inc. - USA
2. Canadian Solar Inc. - Canada
3. Trina Solar - China
4. JA Solar Holdings - China
5. Hanwha Q Cells Co., Ltd. - South Korea
6. LONGi Green Energy Technology Co., Ltd. - China
7. Renesola Ltd. - China
8. Vivint Solar - USA
9. SunPower Corporation - USA
10. SMA Solar Technology AG - Germany
11. Enphase Energy, Inc. - USA
12. ABB Group - Switzerland
13. Huawei Technologies Co., Ltd. - China
14. SolarEdge Technologies, Inc. - Israel
15. GCL-Poly Energy Holdings Limited - China
16. Kyocera Corporation - Japan
17. Sunrun Inc. - USA
18. REC Group - Norway
19. Sungrow Power Supply Co., Ltd. - China
20. Shunfeng International Clean Energy Limited (SFCE) - China
21. Sharp Corporation - Japan
22. Risen Energy Co., Ltd. - China

Frequently asked Questions:

1] What segments are covered in the Solar Power Equipment Market report?
Ans. The segments covered in the Solar Power Equipment Market report are based on the Equipment Type and Application.

2] Which region is expected to hold the highest share in the Solar Power Equipment Market?
Ans. The Asia Pacific region is expected to hold the highest share in the Solar Power Equipment Market.

3] What is the market size of the Solar Power Equipment Market by 2029?
Ans. The market size of the Solar Power Equipment Market by 2030 is expected to reach US$ 245.9 Bn.

4] What is the forecast period for the Solar Power Equipment Market?
Ans. The forecast period for the Solar Power Equipment Market is 2023-2030.

5] What was the market size of the Solar Power Equipment Market in 2022?
Ans. The market size of the Solar Power Equipment Market in 2023 was valued at US$ 121.78 Bn.