Concentrated Solar Power (CSP) Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)

Market Overview

The global concentrated solar power (CSP) market is expected to grow at a CAGR of more than 4% during the forecast period. As of 2018, the global installed capacity of concentrated solar power market was approximately 5.46 GW. Factors such as declining cost of CSP components, is likely to drive the concentrated solar power market during the forecast period. However, rapid decline in installation costs of solar photovoltaic (PV) plants, coupled with increased capacity factors, has improved the economic competitiveness of solar photovoltaic (PV) projects, worldwide. This makes CSP less lucrative, when compared to solar PV, due to several drawbacks, including high CAPEX, OPEX, and its limitation to utility scale. This is expected to hinder the market for CSP during the forecast period.

• The molten salt technology accounts for 75% of the thermal energy storage developed for electricity applications worldwide. These applications also support CSP projects and dispatch electricity outside peak sunshine hours. This heat transfer fluid technology is expected to dominate the market in during the forecast period.
• The Middle-East and Africa is expected to provide more opportunity for CSP market in the near future. This is due to the planned investment which is focused on mobilizing concessional financing and grants to help CSP scale up in the region.
• Europe has dominated the concentrated solar power market, with the majority of the demand coming from Spain.

Scope pf the Market

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Key Market Trends

Molten Salt to Dominate the Market

• Molten salts of sodium and potassium are used as heat transfer fluid in CSP plants, due to their capability to operate at temperatures beyond 500ᵒC, improve power efficiency to about 40%, and reduce the levelised cost of electricity (LCOE). However, due to the high freezing point of about 250°C, a high amount of auxiliary power is required during shut-off periods, to keep them in molten state.
• Molten salts also possess corrosive nature, and hence, expensive operational machineries and system engineering (in terms of piping, pumps, etc.) are required for efficient operation.
• Molten salt technology accounts for 75% of the thermal energy storage developed for electricity application across the world. These applications also support CSP projects and dispatch electricity outside peak sunshine hours.
• China is likely to be the biggest upcoming market for molten salt storage. The country is taking major interest in CSP development. It has joined forces with companies bidding in the Middle-East and is expected to install 1.3 GW of CSP across 21 projects in the country in the next few years. These projects are likely to give China the required expertise it needs to install a total of 5 GW of CSP capacity by 2020.
• In 2018, the second phase of Shouhang Dunhuang’s 100 MW molten salt CSP tower project was commissioned. The second phase of the project owns the title of the world’s largest stand-alone solar field, with over 10,000 heliostat.
• Hence, the molten salt heat transfer fluid is expected to drive the market for concentrated solar power during the forecast period.

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