Solar Lease Service Market Drivers:
Increasing solar power generation: Solar power generation has been on a steady rise globally, driven by several factors, including greater awareness of climate change, improving economics, and supportive government policies around the world. More and more homes and businesses are installing rooftop solar panels to generate their own green electricity and reduce carbon emissions.
For instance, according to Energy Efficiency and Renewable Energy, in 2022, there was a resurgence in the off-grid solar market after years of stagnation caused by the COVID-19 pandemic. A remarkable 9.5 million off-grid solar products were purchased, boasting a total capacity of 94 megawatts (MW). Most of these sales were related to lighting solutions and an array of appliances, including fans, televisions, water pumps, and refrigerators.
Declining solar panel installation costs: Declining solar panel installation costs have been a significant factor driving the growth of the solar lease service market over the past few years. As technology has advanced, solar panels have become more efficient at converting sunlight into energy while also decreasing in price. This steep decline has made solar more accessible and affordable for both homeowners and businesses. With lower upfront costs, solar leasing has emerged as an attractive option that has allowed many more customers to adopt solar without large capital outlays.
For instance on Feb 2021, previously, the U.S. Department of Energy reported that the initial expenses for an average home solar system could reach as high as US$40,000. However, current figures show that these costs have decreased to below US$15,000, and it is anticipated that they will further decline to under US$10,000 by 2023, according to forecasts from International Renewable Energy Agency (IRENA).
Solar Lease Service Market Opportunities:
Emerging markets in developing countries: Emerging markets in developing countries present a huge opportunity for the solar lease service market in the coming years. These developing nations are experiencing high economic growth and a rise in energy demands from the residential and commercial sectors. However, access to electricity remains a challenge for millions as conventional power infrastructure expansion cannot match the pace of development. The solar lease service helps address this issue by allowing users to utilize solar energy through pay-as-you-go or subscription models without having to invest heavily upfront.
For instance in April 2023, India offers a compelling case of a promising solar lease service market. With a target of achieving 500 GW of renewable energy by 2030, research by the Council on Energy, Environment, and Water suggests that distributed solar, in conjunction with storage solutions, will play a crucial role in this endeavor.
Emergence of battery storage technology: The emergence of battery storage technology can provide a great opportunity for the solar lease service market to reach new heights. Energy storage provides an important solution for the intermittent nature of solar power generation. Batteries allow excess solar energy produced during the day to be stored and used later in the evening when the sun goes down. This helps solve the issue of solar power not being available at night and provides customers with power around the clock. With battery storage included in solar lease offerings, customers will get more value and reliability from their solar system. They can feel secure knowing that their energy needs will be met whether the sun is out or not.
For instance, the International Renewable Energy Agency reports a remarkable 85% drop in lithium-ion battery prices over the last ten years. Projections from the U.S. Department of Energy indicate that standard home battery storage systems could become cost-competitive with traditional backup generators by 2030, thanks to the ongoing decrease in battery costs. As these expenses continue to decline, there will be an increased willingness among consumers to opt for bundled solar and storage systems instead of solar-only solutions. This creates a substantial potential market for solar leasing companies to seize upon.
Solar Lease Service Market Restraints:
Solar Lease Service Market Report Snapshots
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