Solar Air Conditioning Market - Significant Growth in Renewable Energy Generation and Rising Adoption of Energy-Efficient Systems
The Solar air conditioning market is estimated to witness high growth owing to significant growth in renewable energy generation and rising adoption of energy-efficient systems.
The global solar air conditioning market is estimated to be valued at US$ 545.6 Mn in 2024, exhibiting a CAGR of 3.4% over the forecast period (2024-2031). Furthermore, supportive government initiatives and subsidies towards the adoption of solar energy-based products are encouraging manufacturers to develop innovative solar air conditioners, thus boosting the market growth.
Market Dynamics:
Growing demand for energy-efficient solutions and favorable governmental policies and initiatives towards the adoption of renewable energy sources are the major factors driving the growth of the global solar air conditioning market. Solar air conditioners reduce dependency on non-renewable energy sources and provide cooling without increasing carbon footprint. Additionally, governments across various countries provide subsidies to encourage individuals to purchase renewable energy-based products including solar air conditioners. This is positively impacting the market growth. Moreover, increasing public awareness about global warming and climate change has heightened the focus on energy-efficient technologies. Solar air conditioners that leverage natural energy from sun to provide cooling offer an eco-friendly alternative, thereby witnessing widespread acceptance. Advancements in solar technology and declining prices of solar panels are also supporting the market expansion.
Two Major Market Drivers for the Global Solar Air Conditioning Market
Increasing Concerns about Rising Electricity Costs
One of the major drivers for the growth of the global solar air conditioning market is the rising concerns about increasing electricity costs across both residential and commercial sectors. Solar air conditioning systems help reduce dependence on grid electricity as they can be powered solely using solar energy during daylight hours. This provides significant savings on monthly electricity bills for properties equipped with solar air conditioners. As fossil fuel prices continue to rise, grid electricity prices are also expected to increase considerably in the coming years. More consumers and businesses are looking at solar air conditioning as a feasible solution to tackle rising electricity costs.
Stringent Government Regulations to Cut Carbon Emissions
Stringent government regulations and policies aimed at reducing carbon emissions from buildings are another key growth driver. Many countries have implemented policies and incentive programs to promote the adoption of renewable energy technologies and energy efficient appliances. Solar air conditioners qualify for various subsidies and tax rebates offered by governments looking to meet their greenhouse gas reduction targets. The systems help lower emissions from conventional air conditioning by displacing the need for coal/gas-fired electricity. With mounting environmental pressures, more nations are introducing stricter building codes and efficiency standards which is driving increased demand for solar air conditioners.
Two Major Market Restraints for the Global Solar Air Conditioning Market
High Upfront Equipment and Installation Costs
The high initial capital costs involved in purchasing and installing solar air conditioning systems act as a major restraint in widespread adoption, especially in price sensitive residential markets. While lifetime operating costs are lower compared to traditional air conditioners, the upfront expenditure is significantly higher which deters many potential buyers. Additional costs are incurred towards components like solar panels, batteries for storage and specialized inverters. Perceived higher risks and longer payback periods also discourage certain customer segments.
Lack of Standardization and Testing Facilities
Unlike conventional air conditioners, there are no widely accepted international performance testing and rating protocols established for solar air conditioning systems yet. This lack of standardization leads to inconsistencies in product quality and reliability across manufacturers. The absence of proper certification mechanisms also raises doubts in the minds of consumers about the efficiency and longevity claims made by different companies. Limited third-party testing facilities further compound uncertainty and quality issues which negatively impact broader commercialization of these systems.
Two Major Market Opportunities for the Global Solar Air Conditioning Market
Growing Residential Retrofit Market
A lucrative opportunity exists in the residential retrofit solar air conditioning market, as most new construction already factors in renewable energy systems. Many existing homes still rely solely on grid power for cooling needs but owners are increasingly interested in retrofitting with solar solutions to supplement or replace conventional air conditioners. This rapidly growing sector provides companies scope to develop customized retrofit kits and services catering to the needs of homeowners looking to integrate renewable technologies post-construction.
Rise of Distributed Energy and Off-grid Applications
The global trend of distributed renewable energy generation and focus on enhancing energy access in remote/off-grid regions open up new promising applications for stand-alone solar air conditioners. Their ability to provide thermal comfort independently without grid-connectivity makes them well-suited for diverse geographies and use cases such as island communities, rural/peri-urban areas, recreational vehicles, boats, etc. Various hybrid mini-grid and micro-grid projects also present opportunities to deploy solar air conditioning at a decentralized, distributed level. This rapidly expanding application sphere can drive heightened demand going forward.
Link: https://www.coherentmarketinsights.com/market-insight/solar-air-conditioning-market-2528
Key Developments:
- In December 2023, GREE, a leading HVAC manufacturer, unveiled its revolutionary Solar VRF (Variable Refrigerant Flow) air conditioning system, which can operate solely on solar power. This innovative product launch not only represents a major milestone in the HVAC industry but also demonstrates GREE's dedication to developing sustainable solutions that align with the environmental objectives of COP28.
- In September 2023, Haier, a leading home appliance manufacturer, unveiled a revolutionary solar hybrid air conditioner that can operate solely on solar power during daylight hours. This innovative product seamlessly integrates four 540W solar panels directly with the outdoor unit, eliminating the need for any intermediary devices like inverters, batteries, UPS, or converters. The solar hybrid AC functions autonomously, providing cooling comfort without incurring any electricity costs during the day. This groundbreaking technology marks a significant stride towards sustainable and energy-efficient cooling solutions.
Key Players:
Aussie Solar World, Carrier Global Corp., Gree, Haier, HotSpot Energy, ICESolair, Jntech Renewable Energy Co., Ltd., Lennox, Midea, Midea group, Recreatetech, Solair World International, Silver Ticket Products, Stewart Filmscreen Corporation, and Videocon
