SOLAR PV PANELS MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024-2031)

Solar PV Panels Market Size and Trends

The Solar PV Panels Market is estimated to be valued at USD 183.14 Bn in 2024 and is expected to reach USD 305.81 Bn by 2031, exhibiting a compound annual growth rate (CAGR) of 7.6% from 2024 to 2031.

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The increasing demand for renewable energy due to growing environmental concerns globally is driving the adoption of solar panels. The declining costs of solar panels along with supportive government policies in the form of tax rebates and net metering is further boosting the market growth. In addition, the rising adoption of solar+storage technology and increasing usage of solar panels for residential and non-residential purposes is expected to propel the solar PV panels market growth. However, the intermittent nature of solar may hamper the market growth to some extent. The installation of BIPV (building integrated photovoltaics) is also attracting many end-users.

Growing environmental awareness

The growing awareness about climate change and its detrimental impact on the environment has been a key driver for the adoption of solar PV panels globally. There is a widespread recognition that over-dependence on fossil fuels is unsustainable in the long run and is leading to rise in global temperatures. More and more people are realizing how their electricity consumption patterns are contributing to carbon footprint. This has motivated homeowners, businesses, and industries to look for clean and green sources of energy that can reduce their reliance on electricity grids primarily powered by coal and natural gas.

Solar PV systems provide a decentralized way to harness renewable power from sun which does not add toxic emissions into the air. As the world is advancing towards a low carbon economy, countries have also introduced various policy measures like attractive net-metering policies, tax incentives, and rebates to encourage their citizens to install solar systems. This has significantly reduced the installation and setup costs of solar panels over time. Additionally, improving technologies have also made the panels more efficient in converting sunlight into electricity. All these factors combined with easy financing options have simplified the process of switching to solar energy. Many people feel responsible for future generations to transition to eco-friendly energy sources. The market is undoubtedly driven by the growing prioritization of sustainability and minimizing environmental footprint.

Grid parity of Solar PV systems

Another crucial driver has been the cost competitiveness solar PV systems have achieved against utility rates in many parts of the world, often referred to as 'grid parity'. Earlier, the higher upfront investment associated with solar panels was a deterrent for widespread adoption. However, over the years, there has been a steep decline in the prices of solar modules and their related components like inverters due to economies of scale and technological innovation. At the same time, conventional power tariffs in several countries have witnessed upward revisions partly on account of rising fuel costs. This has substantially narrowed the price gap between grid and solar power.

In many sunny regions today, solar generated electricity during daylight hours is less expensive than what is purchased from the utilities. This has made solar an attractive proposition even for commercial and industrial customers looking to mitigate power costs. Achieving grid parity removes the financial hurdle and strongly appeals to the rational economic interests of prosumers. It empowers more customers to meet all or a significant portion of their annual energy demand through rooftop solar and gain long term savings.