Concentrated Solar Power Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Technology (Parabolic Trough, Power Tower, Linear Fresnel), By Application (Residential, Non-Residential, Utility), By Storage (With Storage, Without Storage), By Capacity (≤ 50 MW, > 50 to ≤ 100 MW, > 100 MW), By Component (Solar Field, Power Block, Thermal Energy Storage System), By Region, and By Competition 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 11.50 Billion
CAGR (2026-2031)	10.04%
Fastest Growing Segment	Non-Residential
Largest Market	Europe
Market Size (2031)	USD 20.42 Billion

Market Overview

The Global Concentrated Solar Power Market will grow from USD 11.50 Billion in 2025 to USD 20.42 Billion by 2031 at a 10.04% CAGR. Concentrated Solar Power (CSP) is a renewable energy technology that utilizes mirrors or lenses to focus a large area of sunlight onto a receiver, converting the concentrated light into heat to drive a steam turbine for electricity generation. A primary driver for this market is the technology's capability to integrate thermal energy storage, which allows for dispatchable power generation even after sunset, effectively addressing the intermittency issues associated with other renewable sources. Furthermore, the increasing necessity for grid stability and the decarbonization of high-temperature industrial heating processes actively support the continued development of CSP infrastructure.

Despite these operational advantages, the market encounters a significant challenge regarding high initial capital expenditures and levelized costs compared to solar photovoltaics and wind energy. This economic disparity creates a barrier to entry for new projects in regions where cost-competitiveness is the deciding factor. According to the International Renewable Energy Agency, in 2024, the global installed capacity of Concentrated Solar Power was approximately 6.9 GW. Consequently, the sector relies heavily on specific policy frameworks that value energy storage and dispatchability to justify the substantial investment required for these complex thermal power plants.

Key Market Drivers

The rising demand for dispatchable renewable energy with thermal storage is a primary catalyst for the Global Concentrated Solar Power Market. Unlike variable renewable technologies, CSP integrates molten salt thermal energy storage (TES) to provide stable, baseload electricity, effectively bridging the supply gap during peak demand hours after sunset. This unique capability allows utility operators to stabilize grids heavily penetrated by intermittent wind and solar photovoltaics, creating a structural preference for thermal plants in energy planning. For instance, according to ACWA Power, in October 2024, the Redstone Concentrated Solar Power plant in South Africa began grid synchronization featuring a 12-hour molten salt storage system, designed to ensure a round-the-clock electricity supply. This operational flexibility positions CSP as a critical "thermal battery" for future energy systems, driving its adoption despite higher costs compared to other renewables.

Supportive government policies and carbon emission reduction mandates significantly accelerate market growth, particularly in regions striving for energy independence and industrial decarbonization. Due to the high initial capital requirements of thermal plants, the sector relies on strategic frameworks such as Feed-in Tariffs, public auctions, and renewable portfolio standards to mitigate investment risks. China has aggressively incentivized the technology to complement its massive photovoltaic build-out, establishing it as a central pillar of its renewable infrastructure. According to the China Solar Thermal Alliance, as of early 2025, China had 34 CSP projects under construction with a combined capacity of 3,300 MW, underscoring the substantial impact of state-driven deployment targets. Such policy-driven momentum sustains the industry's global expansion; according to REN21, the total global installed capacity of Concentrated Solar Power reached 7.2 GW in 2024, reflecting the steady accumulation of these strategic projects.

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Key Market Challenges

High initial capital expenditures and levelized costs significantly impede the growth of the Global Concentrated Solar Power Market. While the technology offers valuable dispatchability, its substantial financial requirements create a severe barrier to entry compared to the plummeting costs of solar photovoltaics and wind energy. This cost disadvantage forces the sector to rely heavily on subsidized markets, making it difficult for CSP projects to compete in technology-neutral auctions where immediate affordability is the primary criterion. Consequently, investment decisions frequently favor cheaper renewable alternatives, leading to stagnation in the new project pipeline development outside of state-supported initiatives in specific regions.

The impact of these economic hurdles is evident in the sector's limited deployment figures. According to REN21, in 2024, only 350 MW of new CSP generation capacity was connected to the grid globally. This restricted growth rate underscores the market's inability to achieve economies of scale comparable to PV, as high capital intensity continues to deter unsubsidized commercial investment. Without a strictly cost-competitive profile, the technology remains relegated to a niche status, serving primarily as a specialized grid-stabilization tool rather than a primary source of new generation capacity.

Key Market Trends

The Expansion into Solar Industrial Process Heat Applications is a rapidly accelerating trend as manufacturers increasingly seek to decarbonize thermal operations in hard-to-abate sectors. Unlike conventional electricity generation, this application utilizes concentrating collectors to produce high-temperature steam or hot air directly for industrial activities such as mining, food processing, and chemical manufacturing. This direct thermal coupling significantly improves efficiency by bypassing thermodynamic conversion losses associated with electrical heating, making it a viable alternative to fossil fuel boilers. This market segment is demonstrating robust growth independent of grid-connected power projects. According to the International Energy Agency Solar Heating and Cooling Programme, June 2025, in the 'Solar Heat Worldwide 2025' report, the global market saw 120 MW of new solar industrial heat capacity commissioned in 2024, representing a significant 28% increase compared to the previous year.

The Utilization of CSP for Green Hydrogen Production represents a strategic pivot toward generating liquid solar fuels for the transportation and heavy industry sectors. By integrating concentrated solar thermal energy with high-temperature electrolysis or thermochemical splitting cycles, developers are creating systems that produce hydrogen and its derivatives without relying on the external electrical grid. This approach leverages the consistent thermal energy provided by CSP to ensure the steady, high-capacity factor operation required for cost-effective hydrogen synthesis. A notable example of this industrial shift is the advancement of projects dedicated to producing green methanol for the shipping industry. According to Vast Renewables, March 2025, in an announcement regarding the 'Port Augusta Green Energy Hub', the company advanced its co-located Solar Methanol 1 facility, which is designed to produce 7,500 tonnes of green methanol annually using dispatchable solar thermal power.

Segmental Insights

The Non-Residential segment is currently positioning itself as the fastest-growing category within the Global Concentrated Solar Power Market due to an increasing demand for clean industrial process heat. Manufacturing facilities and commercial enterprises are adopting this technology to meet stringent decarbonization targets while securing reliable thermal energy storage for continuous operations. Organizations such as the International Energy Agency emphasize the necessity of solar thermal integration to reduce emissions in heavy industries. This accelerated adoption is fueled by the ability of these systems to provide dispatchable renewable energy that stabilizes commercial power costs and ensures operational resilience.

Regional Insights

Europe commands a dominant position in the global Concentrated Solar Power market, primarily due to the extensive operational capacity established in Spain. This leadership is sustained by favorable regulatory frameworks and ambitious climate targets set by the European Commission, particularly under the European Green Deal. These policies encourage continuous investment in renewable infrastructure and grid integration. Additionally, the region houses many established project developers and engineering firms that drive technological advancement, allowing Europe to maintain its competitive advantage and influence over the international solar thermal landscape.

Recent Developments

• In March 2025, Larsen & Toubro entered into a memorandum of understanding with John Cockerill to collaborate on concentrated solar power and thermal energy storage technologies. The partnership focused on exploring opportunities for manufacturing, component supply, and engineering solutions tailored to the Indian market. By combining local engineering capabilities with specialized global expertise in thermal solar receivers and storage, the companies aimed to deliver low-carbon, round-the-clock energy solutions. This strategic alliance was intended to support the region's transition toward sustainable energy adoption and meet the growing demand for reliable, dispatchable renewable power.
• In October 2024, ACWA Power announced that the Redstone Concentrating Solar Power plant in South Africa had successfully synchronized with the national grid and achieved a generation capacity of 50 MW. This milestone was reached in collaboration with partners Herlogas and SEPCOIII, positioning the facility to soon attain its full 100 MW capacity. The project was designed to supply clean energy to approximately 200,000 households while significantly mitigating carbon emissions. This development reinforced the company's role in expanding renewable energy infrastructure and stabilizing the regional power supply through dispatchable solar thermal technology.
• In June 2024, Cosin Solar received a notification of award to supply the molten salt thermal storage and exchange system for the 100 MW concentrated solar power section of the Luneng Fukang Hybrid Project in China. The company was selected to provide the design, equipment supply, and on-site assembly services for the critical storage infrastructure. This agreement highlighted the deployment of advanced tower CSP technology, where the performance of the molten salt system is essential for safe and efficient plant operation. The project underscored the company's competitiveness in delivering integrated solutions for large-scale renewable energy complexes.
• In April 2024, Vast Solar executed engineering contracts to finalize the front-end engineering design for the VS1 concentrated solar power plant in Australia. The company appointed a consortium of partners, including FYFE, Primero, Afry, and Worley, to advance the development of the 30 MW thermal facility. This collaboration aimed to utilize modular tower technology to capture and store solar energy, enabling dispatchable power generation. The project was positioned as a significant step toward construction, with the design phase scheduled for completion later that year ahead of a final investment decision.

Key Market Players

• Abengoa S.A.
• Acciona Energy, S.A.
• Enel SpA
• Shanghai Electric Power Generation Co., Ltd.
• China National Chemical Engineering & Construction Corporation
• Heliand Power GmbH
• SolarReserve LLC

By Technology	By Application	By Storage	By Capacity	By Component	By Region
Parabolic Trough Power Tower Linear Fresnel	Residential Non-Residential Utility	With Storage Without Storage	≤ 50 MW > 50 to ≤ 100 MW > 100 MW	Solar Field Power Block Thermal Energy Storage System	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Concentrated Solar Power Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Concentrated Solar Power Market, By Technology:

• Parabolic Trough
• Power Tower
• Linear Fresnel

• Concentrated Solar Power Market, By Application:

• Residential
• Non-Residential
• Utility

• Concentrated Solar Power Market, By Storage:

• With Storage
• Without Storage

• Concentrated Solar Power Market, By Capacity:

• ≤ 50 MW
• > 50 to ≤ 100 MW
• > 100 MW

• Concentrated Solar Power Market, By Component:

• Solar Field
• Power Block
• Thermal Energy Storage System

• Concentrated Solar Power Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE