Solar Energy Market Size, Share, Trends & Report | 2034

Solar energy is one of the most prominent renewable energy sources, harnessing the power of the sun to generate electricity and heat.

Technology Feb 12, 2025 65 Add to Reading List

Solar Energy Market Size, Share, Trends & Report | 2034

Solar Energy Market Outlook

According to the report by Expert Market Research (EMR), the global solar energy market attained a value of 205.13 GW in 2024. Driven by the increasing demand for sustainable energy solutions, government incentives, and technological advancements, the market is projected to grow at a compound annual growth rate (CAGR) of 7.7% between 2025 and 2034, reaching a projected value of 400.22 GW by 2034.

Solar energy is one of the most prominent renewable energy sources, harnessing the power of the sun to generate electricity and heat. With growing environmental concerns and the urgent need to transition to clean energy sources, solar power has emerged as a key player in the global energy landscape. Its applications span residential, commercial, and industrial sectors, providing affordable and sustainable alternatives to traditional fossil fuels.

As the world continues to grapple with climate change, the transition to renewable energy is becoming an essential priority. Solar energy plays a vital role in reducing carbon emissions and achieving global sustainability goals. Furthermore, with technological improvements, the economic feasibility of solar energy has significantly enhanced, making it more accessible to individuals, businesses, and governments alike.

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Key Drivers of the Solar Energy Market

The global solar energy market is being driven by multiple factors, including increasing environmental concerns, government policies and subsidies, and advances in solar technology. Over the past few decades, the need for cleaner and more sustainable energy solutions has risen sharply. The detrimental environmental impact of fossil fuels, such as carbon emissions and air pollution, has spurred countries worldwide to look for alternative, low-carbon energy sources. Solar energy, with its potential to provide clean, renewable, and abundant power, has become an ideal solution.

Government policies, subsidies, and incentives are another crucial factor driving the growth of the solar energy market. Many governments have introduced tax credits, grants, and feed-in tariffs to encourage the adoption of solar energy technologies. These incentives have made solar energy systems more affordable and attractive to consumers, businesses, and utilities. For instance, the U.S. federal investment tax credit (ITC) has been instrumental in supporting the expansion of solar installations in the residential and commercial sectors. Similarly, the European Union, India, China, and many other countries have implemented ambitious renewable energy targets, further promoting solar energy adoption.

Technological advancements in solar panel efficiency, energy storage, and grid integration are also propelling the market. Solar panels have become more efficient, durable, and affordable, enabling consumers and businesses to maximize the benefits of solar power. Innovations such as bifacial solar panels, thin-film technology, and concentrated solar power (CSP) systems have enhanced the performance and efficiency of solar installations. Additionally, breakthroughs in energy storage technologies, such as lithium-ion batteries, have improved the ability to store excess energy generated during the day for use at night, further increasing the feasibility of solar energy as a reliable power source.

Growth in Demand for Clean and Sustainable Energy

The global demand for clean and sustainable energy is one of the primary drivers of the solar energy market. With rising concerns about climate change, air pollution, and the depletion of fossil fuel resources, governments, businesses, and individuals are increasingly turning to renewable energy sources like solar power to reduce their environmental footprint. The shift toward cleaner energy is especially evident in the transportation and industrial sectors, where solar energy is being integrated into electric vehicles, manufacturing processes, and industrial facilities.

Furthermore, the increasing demand for electricity, particularly in emerging economies, is fueling the adoption of solar energy. With urbanization and industrialization on the rise, particularly in regions like Asia-Pacific and Africa, solar energy offers an effective solution to meet the growing power demand while minimizing environmental impact. Solar energy systems, which can be deployed at both small and large scales, are particularly well-suited to serve remote or off-grid areas where access to electricity is limited or unavailable.

The decentralized nature of solar power also plays a key role in its growing popularity. Unlike traditional power generation methods, which often require extensive infrastructure and long-distance transmission lines, solar energy can be harnessed locally, reducing transmission losses and improving energy security. Solar power's ability to be deployed at both residential and utility-scale levels enables a more flexible and diverse energy mix that meets the needs of different consumers and industries.

Technological Advancements in Solar Power

Technological advancements continue to drive the global solar energy market. The efficiency of solar panels has improved dramatically over the past decade, with leading manufacturers developing high-efficiency models that convert more sunlight into electricity. For example, the development of monocrystalline and polycrystalline silicon solar panels has enhanced the power output of solar installations, making them more cost-effective and attractive to consumers.

Newer technologies, such as perovskite solar cells, are also showing significant potential to revolutionize the market. These advanced materials offer the possibility of creating cheaper, more efficient solar cells that could lower the cost of solar power even further. Moreover, the integration of artificial intelligence (AI) and machine learning technologies into solar panel production and energy management systems has enhanced the monitoring, maintenance, and optimization of solar installations.

In addition to solar panel efficiency, advancements in solar energy storage technologies are further driving market growth. Energy storage systems, such as lithium-ion batteries and flow batteries, enable consumers and utilities to store excess energy generated during the day for use during periods of low sunlight. This has enhanced the reliability and availability of solar energy, making it a viable option for powering homes, businesses, and even entire grids.

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Solar Energy Market Segmentation

The market can be divided based on technology, solar module, application, and region.

Market Breakup by Technology

Solar Photovoltaic
Mono-Si
Thin Film
Multi-Si
Others
Concentrated Solar Power
Parabolic Trough
Power Tower
Linear Fresnel

Market Breakup by Solar Module

Monocrystalline
Polycrystalline
Thin-Film Solar Modules
Others

Market Breakup by Application

Residential
Commercial and Industrial
Utility

Market Breakup by Region

North America
Europe
Asia Pacific
Latin America
Middle East and Africa

Competitive Landscape

Some of the major players explored in the report by Expert Market Research are as follows:

Adani Green Energy Limited
Acciona SA
Canadian Solar Inc.
JA Solar Technology Co., Ltd.
Sunrun Inc.
SunPower Corporation
Kaneka Corporation
Tata Power Solar Systems Ltd.
Suntech Power Holdings Co., Ltd.
JinkoSolar Holding Co., Ltd
Others

Challenges and Opportunities

Despite the promising growth prospects, the solar energy market faces several challenges. The intermittent nature of solar power, as it is reliant on sunlight, can make it difficult to provide a constant, reliable energy supply. While energy storage solutions are improving, they still represent a significant cost, which can make solar power less economically viable for certain applications.

The initial cost of installing solar energy systems, although decreasing, can still be a barrier to widespread adoption, particularly in developing countries. Despite the availability of subsidies and incentives, financing remains a challenge for some consumers and businesses. Additionally, the disposal of solar panels at the end of their lifespan presents an environmental challenge, as the recycling of photovoltaic cells is still an evolving process.