|Solar thermal systems offer significant economic growth potential.|
The market for solar thermal systems (STS) in Europe has seen significant development at all levels in the last four years. Policy makers, market participants, and end users have shown a keen interest in STS, ensuring a high growth potential. Due to its tremendous long-term growth prospects, this market has attracted multiple new participants that are playing a central role in promoting the industry.
New analysis from Frost & Sullivan, European Solar Thermal Heating Systems Market, finds that the market earned revenues of over euro 958.9 million in 2008 and estimates this will reach euro 2.2 billion in 2014. The technologies research discussed in this report covers both passive and active solar thermal systems.
“Currently, the key driver for the market in Europe is government support for STS in the form of financial subsidies, tax credits, and regulatory reforms,” says Hammam Ahmed, Frost & Sullivan Research Analyst. “The market for STS is highly responsive to fluctuations in the provision of governmental support.”
As an example, the Italian market witnessed strong growth levels following increased government subsidies for solar thermal systems, while the German market saw a significant decline as a direct consequence of a temporary disruption to these subsidies and recovered as soon as they again became available.
High growth in the STS market, particularly over the last four years, has attracted numerous new participants that are promoting the industry and making STS accessible to a wider customer base.
Cost is the primary obstacle confronting the STS market. Despite the financial incentives that solar thermal installations receive, the overall price is still high and the time required to recoup investments can be up to 20 years in some regions. Additionally, a solar thermal system is, for practical purposes, only a complementary alternative to a traditional hot water system, not a complete substitute. Therefore, STS is not a viable investment option for most end users, especially in countries where conventional energy prices are low.
“In many countries, particularly in northern Europe, the solar yield can be as little as 40 per cent,” explains Ahmed. “Additionally, the up-front cost of a solar thermal system continues to be expensive.”
In light of this research, companies should work on developing low-cost and effective solar thermal systems, particularly in Europe’s current economic climate. In general, with escalating competition, both manufacturers and installers will be forced to reduce prices and the overall price of STS will go down.
European Solar Thermal Heating Systems Market is part of the Building Management Technologies Growth Partnership Services programme, which also includes research into Strategic Assessment of Growth Opportunities in the European Green Buildings Markets and European Building Integrated Photovoltaics Market.
Frost & Sullivan, the Growth Partnership Company, provides clients with disciplined research and best practice models to drive the generation, evaluation, and implementation of powerful growth strategies. Frost & Sullivan leverages over 45 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from more than 35 offices on six continents.
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