Concentrated Solar Power Market Report 2025: Growth Driven by Government Incentives and Partnerships

Key Insights

The size of the Concentrated Solar Power Market was valued at USD 31.8 million in 2024 and is projected to reach USD 77.64 million by 2033, with an expected CAGR of 13.6% during the forecast period. The Concentrated Solar Power (CSP) market focuses on the use of solar thermal energy to generate electricity through systems that concentrate sunlight using mirrors or lenses to heat a fluid, which then produces steam to drive a turbine. CSP technology is typically deployed in large-scale power plants, making it an ideal solution for utility-scale solar energy generation. The market is driven by the increasing global demand for renewable energy, the push for decarbonization, and the need to reduce reliance on fossil fuels. CSP offers the advantage of providing reliable, dispatchable power, as the thermal energy can be stored and used even when the sun is not shining, unlike traditional photovoltaic solar systems. Government incentives, policies promoting clean energy, and the growing focus on sustainable and energy-efficient solutions are fueling the expansion of the CSP market. Additionally, technological advancements in CSP systems, such as improved heat storage and more efficient turbines, are helping to reduce costs and enhance the commercial viability of CSP projects. As countries aim to meet their climate goals, the Concentrated Solar Power market is expected to grow significantly in the coming years, especially in regions with high solar irradiance like the Middle East, North Africa, and parts of the United States and Spain.

Concentrated Solar Power Market Concentration & Characteristics

The CSP market demonstrates moderate concentration, with a few large players holding significant market share, yet characterized by a dynamic competitive landscape. Innovation is primarily focused on improving energy storage solutions, enhancing system efficiency, and reducing costs. Regulations, such as renewable portfolio standards (RPS) and carbon emission reduction targets, strongly influence market growth. While CSP has some competition from other renewable energy sources like photovoltaic (PV) solar, its ability to provide dispatchable power with thermal storage makes it a unique and complementary option. End-user concentration is largely among utility companies and independent power producers (IPPs), with a growing interest from industrial users seeking on-site power solutions. The level of mergers and acquisitions (M&A) activity is relatively high, reflecting the consolidation and strategic expansion within the sector. Companies are merging to gain access to technology, projects, and geographic markets. This activity often leads to increased technological advancements and market efficiency, yet also increases the barrier to entry for new smaller players. This concentration in the larger companies, therefore, drives innovation, but also restricts competition.

Concentrated Solar Power Market Trends

Several key trends are shaping the future of the CSP market. Firstly, the increasing integration of CSP with other renewable energy sources, creating hybrid systems, is enhancing grid stability and maximizing energy output. Secondly, the development of advanced thermal storage systems, particularly molten salt technologies, is extending operational hours and improving the dispatch capabilities of CSP plants. Thirdly, the focus on reducing the levelized cost of energy (LCOE) through technological advancements and economies of scale is driving greater cost-competitiveness. Fourthly, the rising demand for CSP in emerging economies with high solar irradiance is expanding the market geographically. This can be attributed to their growing energy needs and favorable government policies. Fifthly, there's a strong emphasis on optimizing project financing and risk mitigation strategies to attract greater investment. Finally, the increasing adoption of digital technologies for enhanced operation and maintenance of CSP plants is improving efficiency and optimizing performance. These trends highlight the ongoing evolution of the CSP market and its growing importance in the global energy transition.

Key Region or Country & Segment to Dominate the Market

• Segment: > 100 MW capacity plants

The segment of CSP plants with capacities exceeding 100 MW is poised to dominate the market due to several factors. Large-scale projects offer significant economies of scale, leading to lower LCOE. Utility companies and IPPs favor these larger projects because they can meet substantial electricity demands more efficiently. The significant investment required for these larger-scale plants however, concentrates the market in the hands of a few large players with access to substantial capital. Furthermore, the technological advancements in areas like advanced thermal storage and system optimization are more readily implemented in these larger plants, enabling further gains in efficiency and cost-effectiveness. This also creates a higher barrier for entry, furthering the dominance of existing large players.

• Region: North America (specifically, the U.S.) and the Middle East and Africa (MEA) region.

The U.S., due to supportive government policies, abundant solar resources, and established infrastructure, is anticipated to hold a substantial market share. The MEA region, especially countries with high solar irradiation like Saudi Arabia and the UAE, presents significant growth potential driven by government initiatives focusing on energy diversification and renewable energy targets. This has attracted substantial investments into large-scale CSP projects. The combination of high solar irradiance, ample land availability, and government incentives makes the MEA region exceptionally suitable for massive CSP installations, leading to its dominant positioning in the market.

Concentrated Solar Power Market Product Insights Report Coverage & Deliverables

This report provides a comprehensive analysis of the Concentrated Solar Power market, covering market size, segmentation by technology (Parabolic Trough, Linear Fresnel Reflector, Power Tower), capacity (≤ 50 MW, > 50 MW to ≤ 100 MW, > 100 MW), and storage (with and without storage). It also examines regional market dynamics, key players, and emerging trends, along with a detailed analysis of market drivers, challenges, and future prospects. The report further offers insights into market dynamics, competitive landscape, and investment opportunities within the CSP sector.

Concentrated Solar Power Market Analysis

The Concentrated Solar Power (CSP) market demonstrates strong growth potential, with increasing market size and share. Market size is projected to surpass $50 billion within the next decade, fuelled by government support, technological advancements, and growing demand for clean energy. Major players are expanding their capacity, and smaller companies are entering the market, contributing to increased competition and innovation. Market share is largely concentrated among established players, but a steady increase in new entrants is anticipated. The growth is particularly pronounced in emerging markets with high solar irradiance and supportive government policies. Analysis indicates that this segment will experience disproportionately higher growth than other segments, particularly driven by the increasing demand for baseload power and the capacity for grid-scale energy storage.

Concentrated Solar Power Market Regional Insights

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Netherlands
  • Sweden
  • Rest of Europe
• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • Australia
  • Singapore
  • Thailand
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Argentina
  • Chile
  • Colombia
  • Rest of Latin America
• MEA
  • Saudi Arabia
  • UAE
  • South Africa
  • Egypt
  • Nigeria
  • Rest of MEA

Driving Forces: What's Propelling the Concentrated Solar Power Market

The CSP market is propelled by several factors: growing concerns about climate change and the need for decarbonization, supportive government policies and incentives, technological advancements leading to improved efficiency and cost reduction, and the increasing demand for reliable and dispatchable renewable energy. These factors collectively drive market expansion and investment in CSP projects globally.

Challenges and Restraints in Concentrated Solar Power Market

Challenges to CSP market growth include high upfront capital costs, land requirements, water consumption (in some technologies), and intermittent solar resource availability. Addressing these challenges through technological innovations, efficient project financing, and improved water management strategies is crucial for further market expansion.

Emerging Trends in Concentrated Solar Power Market

Emerging trends include the integration of CSP with energy storage, hybrid renewable energy systems, and smart grid technologies, enhancing grid stability and efficiency. Advancements in AI and machine learning for optimized CSP operation and maintenance also contribute to market growth.

Concentrated Solar Power Industry News

• January 2024: A major CSP project commenced operations in the UAE, marking a significant milestone in the region's renewable energy transition.
• March 2024: A new partnership was formed between two leading CSP companies to develop next-generation storage technologies.
• June 2024: A new policy was announced by the US government offering further tax credits for large-scale CSP deployments.

Leading Players in the Concentrated Solar Power Market

• Abengoa S.A
• GE Renewable Energy
• ACCIONA
• Enel Green Power S.p.A
• Atlantica Sustainable Infrastructure plc

Concentrated Solar Power Market Segmentation

• 1. Technology
  • 1.1. Parabolic Trough
  • 1.2. Linear Fresnel Reflector
  • 1.3. Power Tower
• 2. Capacity
  • 2.1. ≤ 50 MW
  • 2.2. > 50 MW to ≤ 100 MW
  • 2.3. > 100 MW
• 3. Storage
  • 3.1. With Storage
    • 3.1.1. Molten Salt
    • 3.1.2. Others
  • 3.2. Without Storage

Concentrated Solar Power Market Segmentation By Geography

• 1. North America
  • 1.1. U.S.
  • 1.2. Canada
• 2. Europe
  • 2.1. Germany
  • 2.2. UK
  • 2.3. France
  • 2.4. Italy
  • 2.5. Spain
  • 2.6. Netherlands
  • 2.7. Sweden
  • 2.8. Rest of Europe
• 3. Asia Pacific
  • 3.1. China
  • 3.2. India
  • 3.3. Japan
  • 3.4. South Korea
  • 3.5. Australia
  • 3.6. Singapore
  • 3.7. Thailand
  • 3.8. Rest of Asia Pacific
• 4. Latin America
  • 4.1. Brazil
  • 4.2. Mexico
  • 4.3. Argentina
  • 4.4. Chile
  • 4.5. Colombia
  • 4.6. Rest of Latin America
• 5. MEA
  • 5.1. Saudi Arabia
  • 5.2. UAE
  • 5.3. South Africa
  • 5.4. Egypt
  • 5.5. Nigeria
  • 5.6. Rest of MEA