Concentrated Solar Power (CSP) Market Size & Share Analysis - Growth Trends and Forecast (2026 - 2031)

Global Concentrated Solar Power (CSP) Market Trends and Insights

Declining LCOE for CSP With Storage

Levelized-cost curves for CSP combined with molten-salt storage fell 70% between 2010 and 2024, hitting USD 0.092 per kWh worldwide, while Chinese projects landed at USD 0.069 per kWh in late 2024.^{[3]International Renewable Energy Agency, “Renewable Power Generation Costs 2024,” irena.org} Standardized heliostat designs, local manufacturing in China and Gulf states, and auction-driven competition underpin that drop. Dubai’s 950 MW Mohammed bin Rashid Al Maktoum Phase 4 locked a record USD 0.073 per kWh tariff in 2023, proving competitiveness against gas turbines in carbon-constrained markets.^{[4]Dubai Electricity and Water Authority, “Mohammed bin Rashid Al Maktoum Solar Park Details,” dewa.gov.ae} Fifteen-hour storage lets utilities defer large battery procurements. Capital markets have started to factor the lower revenue volatility into weighted-average cost of capital models, reducing required equity returns by up to 150 basis points in recent financings. Developers are now underwriting projects assuming a 5% to 7% annual capex decline through 2030, which accelerates pipeline growth in subsidy-light jurisdictions.

Grid Need for Long-Duration Dispatchable Renewables

Global transmission operators report deepening net-load ramps as solar penetration rises. California’s spring 2024 “duck curve” saw a 13 GW three-hour ramp, straining reserves. Lithium-ion batteries excel at four-hour discharge but become uneconomic beyond eight hours, leaving a gap that molten-salt CSP supplies at a lower lifetime cost. CSP turbines can start in under ten minutes, offering inertia and frequency response without cycle-life degradation. Capacity-credit frameworks now assign CSP up to 85% of nameplate rating in Spain, South Africa, and Chile, compared with 30%-50% for photovoltaic-battery hybrids. As grids target 24/7 renewable portfolios, planners are increasingly embedding minimum long-duration storage quotas in resource-adequacy procurements, directly boosting the Concentrated Solar Power market.

MENA & China Policy Auctions Accelerating Build-Out

China’s 14th Five-Year Plan mandates 15 GW of operating CSP by 2030, up from 838 MW in 2024, and provincial auctions in Gansu, Qinghai, and Inner Mongolia attach feed-in premiums tied to storage hours. Saudi Arabia, the UAE, and Egypt launched multi-gigawatt hybrid solar tenders capped below USD 0.08 per kWh, compressing lead times by bundling land rights, grid access, and sovereign guarantees. Shouhang High-Tech’s 100 MW Dunhuang tower demonstrated bankability, catalyzing a 3.3 GW construction wave. Combined, these frameworks pull projects through permitting in under 24 months, sharply faster than legacy European processes, positioning policy auctions as a main catalyst for the Concentrated Solar Power market.

Industrial Process-Heat & Green-Hydrogen Coupling

Industrial heat between 150 °C and 565 °C represents close to 20% of global final energy demand, and CSP can supply that range without combustion emissions. Heineken España’s 30 MW parabolic trough plant cuts gas imports by 18,000 t annually. Saudi Arabia’s NEOM project couples a 300 MW CSP plant to a 50,000 t-per-year hydrogen facility, using tower heat to raise electrolyzer efficiency. Early pilots in Germany and Australia test thermochemical water-splitting at above 800 °C, which next-generation power towers target. These industrial integrations diversify revenue, shorten offtake tenures, and lower merchant-price exposure, lifting projected internal rates of return by 120 basis points on average.

PV + Battery Cost Declines Undercutting CSP Bids

Photovoltaic modules fell another 12% year-on-year in 2024, while lithium-ion packs are 89% cheaper than in 2010, letting four-hour hybrids clear auctions near USD 0.055 per kWh in high-irradiance markets. Australia’s 2024-2025 tenders awarded no CSP, and the United States has not announced new CSP since 2020, as financiers prefer faster, proven photovoltaic projects. Unless RFPs explicitly demand eight-hour-plus discharge or carbon caps favor CSP, bid competitiveness will keep eroding near-term Concentrated Solar Power market share.

High Upfront CAPEX & Limited Project Finance Pools

Average CSP installed cost stood at USD 3,677 per kW in 2024, around 3.7 times photovoltaic benchmarks. Construction spans up to five years, loading projects with interest-rate and foreign-exchange risk. Only USD 6 billion of the USD 40-50 billion CSP investment that the International Energy Agency deems necessary by 2030 was committed in 2024-2025. Multilateral banks fill some gaps, but their lending caps curb diversification, thereby slowing learning-curve benefits in the Concentrated Solar Power industry.

Segment Analysis

By Technology – Power Towers Close the Gap

The Concentrated Solar Power market size for parabolic trough systems stood at 4.86 GW in 2025, equal to 66.7% of total capacity, yet power towers are expanding at a 16.8% CAGR en route to 7.3 GW by 2031. Power towers reach 565 °C, integrate 15-hour storage, and secured 100 MW at Dubai Phase 4 in 2023. Although towers carry a 15%-20% cost premium, Spain’s 2025 auctions awarded them 85% capacity credits against 70% for troughs, tilting new orders. Linear Fresnel and dish-Stirling remain niche, collectively under 3% of 2025 installations, but Fresnel arrays find traction in process-heat projects where land constraints and lower temperature needs dominate economics.

Capex learning rates favor towers as heliostat automation improves and supercritical CO₂ cycles target 50% turbine efficiency by 2030. Troughs continue in hybrid retrofits that reuse turbines and balance-of-plant gear, cutting repower capex by up to 40%. Technology choice now hinges less on optical design and more on dispatch duration and storage integration, a shift that will keep the Concentrated Solar Power market diversified yet tower-weighted through the decade.

Note: Segment shares of all individual segments available upon report purchase

By Heat Transfer Fluid – Molten Salt Widens Lead

Molten salt held 58.5% of 2025 installations and is on course to reach 70% by 2031, underpinning 9.6 GW of the projected Concent​rated Solar Power market size at the end of the forecast period. Dual use as working fluid and storage medium compresses tank volume, as shown by Dubai’s 5,907 MWh storage system. Synthetic oil continues to lose ground amid thermal degradation above 400 °C, while direct steam generation tests in Spain seek lower capex but face control-system complexity. Supercritical CO₂ pilots in New Mexico validated a 10,000-hour operation in 2024, offering a potential 50% cycle efficiency that could unlock further salt alternatives.

Regulation indirectly favors salt, where environmental rules raise containment costs for synthetic oils. China’s nitrate-production dominance remains a supply risk, yet long-term framework contracts have started to appear, smoothing price swings. The shift toward higher operating temperatures cements molten salt as the reference medium, anchoring cost curves in the Concent​rated Solar Power market.

By Capacity Range – Mid-Scale Plants Gain Momentum

Plants above 150 MW dominated capacity in 2025 at 3.6 GW, but 50-150 MW projects exhibit the quickest growth, running at a 19.3% CAGR to 2031. A 100 MW tower with 12-hour storage reached financial close in South Africa’s Redstone project in 2024, relying on blended commercial and development-bank debt. Sub-150 MW designs fit within single-turbine blocks, simplifying debt sizing and construction schedules under 36 months, attributes that appeal to lenders wary of multi-phase megaprojects.

Below-50 MW plants occupy industrial self-generation and off-grid mining niches, where avoided diesel costs justify higher unit capex. Policy incentives in China’s Qinghai province, including fast-track grid interconnection, made the 100-150 MW tranche a sweet spot for domestic investors. Coupled with modular tower receiver packages, mid-scale projects are set to capture a growing slice of the Concent​rated Solar Power market share through 2031.

Note: Segment shares of all individual segments available upon report purchase

Geography Analysis

Europe retained 2.34 GW of capacity in 2025, equal to 32.1% of the global base, yet growth is muted as auctions favor PV-battery hybrids. Spain’s Solgest-1, a 110 MW direct-steam trough, is the only new European CSP under construction, slated for 2026 commissioning. Policy uncertainty and ample offshore wind resources in Northern Europe limit further uptake.

The Middle East and Africa posted the fastest expansion at 22.5% CAGR. Saudi Arabia’s 2.6 GW pipeline, the UAE’s operating 950 MW complex, and Egypt’s 600 MW tender underpin that momentum. Morocco’s Noor complex proves CSP viability in North Africa, spurring feasibility studies in Tunisia, Algeria, and a 200 MW expansion at Noor is being evaluated in 2024. Auction rules bundle sovereign guarantees, de-risking foreign debt, and helping the Concent​rated Solar Power market grow rapidly in the region.

Asia-Pacific growth is China-centric. Operating 838 MW in 2024, China has 3.3 GW under construction and targets 15 GW by 2030, backed by provincial feed-in premiums for ≥10-hour storage. India’s CSP ambitions stalled after only 225 MW out of the original 500 MW Jawaharlal Nehru Mission quota reached completion, and Australia’s Aurora project remains unfunded. North America’s 1.7 GW legacy fleet has seen no new projects since 2014, reflecting investor preference for credit-enhanced photovoltaic storage. South America hosts only Chile’s 110 MW Cerro Dominador, with subsequent CSP proposals sidelined by domestic lithium-battery manufacturing policy.