The global solar home lighting market was estimated at USD 10.8 billion in 2023 and is expected to reach USD 23.78 by 2029, projected to grow at a CAGR of 15.26% during the forecast period 2024-2029.
Market Drivers:
The growth of the solar home lighting market is propelled by the growing need for renewable energy, clean energy, measures for reducing carbon emissions, low repairs and maintenance costs, and easy installation. Another factor driving the rapid development of the market is the government's initiatives to employ solar panels as a source of electricity. Moreover, climate change and escalating oil prices are further boosting the expansion of the solar home lighting market.
With the surge in the global solar industry, there is a greater demand for solar lights. During the previous five years, except for the pandemic period, there has been a spike in the exploration of new renewable energy sources. More than 840 million people in the world lack access to electricity. This energy inequality is a serious problem that is taking the solar home lighting market in developing economies.
The far-reaching benefits to other industries from the growth of the solar home lighting market are also fueling the growth rate. The production of electricity is essential to economic growth. It gives small companies influence, promoting entrepreneurship and generating jobs for the local population.
Market Restraints:
The high purchase cost is one of the factors limiting the growth of solar home lighting market. This includes the price of the solar panels, inverter, batteries, wiring, and installation. However, since solar technology is constantly advancing, it is expected that prices will come down in the future. During cloudy and rainy days, the efficiency of the solar system decreases due to limited solar energy, which affects its demand. Additionally, limited financing options are hindering the market size. The majority of customers struggle to pay the entire upfront cost and are restricted from making purchases due to the lack of access to micro-loans and other financing tools.
Market Opportunities:
IoT-enabled lighting systems and the rising number of smart city projects are expected to provide more opportunities for the solar home lighting market. The focus on reducing carbon emissions and growing consumer awareness are presenting further prospects for the companies in the market to come up with innovation. Moreover, the high percentage of people living in tire 2 and 3 cities is expected to increase the demand for solar home lights. Rural populations are increasingly looking for solar energy due to the large number of off-grid residents and the frequent blackouts in these areas. This has generated growth potential for Indian solar lighting goods and services in various locations.
Market Challenges:
Reliance on traditional energy sources to generate electricity is a major factor hindering the growth of the solar home lighting market. The biggest challenge that remains ahead is shifting away from coal in rapidly expanding emerging markets and developing countries like India and Indonesia, where the need for power will drive an increase in coal generation until the early 2030s in the APS despite a rapid deployment of renewable energy sources. In 2022, coal-fired power plants reported record-breaking CO2 emissions, reaching out to over one-third of all electricity generated worldwide. This was the second year in a row that coal-fired generation hit an all-time high.
Ignorance of alternative energy sources is another challenge derailing the market growth rate. Incorrect assumptions regarding solar technology, like the idea it requires a lot of care or is dependent on sunshine all the time, can discourage prospective users.
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REPORT METRIC |
DETAILS |
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Market Size Available |
2023 – 2029 |
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Base Year |
2023 |
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Forecast Period |
2024 - 2029 |
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CAGR |
15.26% |
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Segments Covered |
By Application, Type, Product Type, Components, Distribution Channel, and Region. |
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Various Analyses Covered |
Global, Regional & Country Level Analysis, Segment-Level Analysis, DROC, PESTLE Analysis, Porter’s Five Forces Analysis, Competitive Landscape, Analyst Overview of Investment Opportunities |
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Regions Covered |
North America, Europe, APAC, Latin America, Middle East & Africa |
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Market Leaders Profiled |
Signify, Eaton, Solar Electric Power Company, Sol Group, Su-Kam Power Systems, Clear Blue Technologies, FlexSol Solutions, Azuri Technologies, Sunna Design, Nokero, SOLEKTRA LIMITED, JinHua SunMaster Solar Lighting Co. Ltd, Solar One, Solar Lighting Company, Inc, and Others. |
Market Segment Analysis:
The rural subsegment is projected to have an upward trend in growth rate in the forecast period. The lack of primary lighting is driving the segment's growth forward. The rising government initiatives worldwide are further pushing the market. The popularity of solar home lighting has increased because multiple nations are actively governing programs for rural electrification and offering incentives. Moreover, the high energy costs are another factor boosting the rural solar home lighting market share.
The Off-grid subsegment is expected to account for a significant portion of the solar home lighting market. The factors fueling the segment growth are the extendibility to meet different energy needs. The demand for off-grid systems is supported by their complete self-sufficiency and the fact that there is no need to connect them to the local grid's power system. According to World Bank estimates, by 2030, mini-grids and off-grid solar could power 425–581 million people without a source of energy at the lowest possible cost.
The solar bulb subsegment holds immense potential for growth in the coming years. Affordable and efficient solar bulbs are expected to expand the growth of the segment. The price of solar bulbs can be reduced by technological developments and economies of scale, which will make them more affordable for a larger range of consumers; when compared to conventional lighting sources, solar LED bulbs can save up to 90 percent in energy consumption. They are more energy efficient and last longer than conventional lights.
The Solar Panel subsegment holds a significant share of the solar home lighting market. The market growth is driven by rising off-grid electrification initiatives, reducing carbon emissions, technological advancements, etc. The requirement for durability and warranties is assisting in expanding the market share of solar panels. In October 2023, high efficiency low on carbon solar panels HELOC plus series with G12 Tunnel Oxide Passivated Contact Technology was launched by Goldi Solar. With a 132-cell Module and N-Type Topcon Technology, the newest model can produce up to 705 Wp of power.
The direct sales subsegment is estimated to achieve a notable percentage of the solar home lighting market in the coming years. The potential for significant growth is boosted in rural areas and off-grid communities. Direct sales agents can bridge information gaps and build trust with potential customers, especially those unfamiliar with solar technologies.
Market Regional Analysis:
North America's solar home lighting market is expected to grow at a significant growth rate during the forecast period. The regional market is anticipated to grow in the long run due to factors like rising environmental awareness and laws as well as falling costs per kilowatt of power produced from solar energy. New thin-film solar cell models with narrower cadmium telluride coatings may present a business opportunity in the industry because of their cheaper cost and increased efficiency. Furthermore, Off-grid applications, which offer dependable and independent illumination for cabins, campgrounds, and locations outside the grid's reach, are a crucial market niche for solar lighting. It is anticipated that the nation will also make R&D investments to support the expansion of the sector.
Europe is anticipated to propel further with promising growth potential in the forecast period. The increasing energy cost is driving the demand for solar home lighting in the region. The market is predicted to move forward with the European Union’s revised Electricity Market Design (EMD), which was approved in December 2023. The revisions were made to overcome the challenges in the regional energy market by creating a framework. As per a report, Europe recorded 56 GW of solar installations in 2023, along with annual growth rates of at least 40 percent for the third time. It is expected that 2024 will see slower growth, and the market will only grow by 11 percent, producing 62 GW.
Asia Pacific offers an evolving, diverse landscape for the solar house lighting market. Technological advancements, increased funding, and supportive legislation are key factors that contributed to the rapid growth in the adoption of green energy in the region. With nations like Vietnam, Malaysia, and the Philippines at the top, solar energy continues to be a major force in the regional energy scene. Other factors boosting the market forward are international obligations towards the Paris Agreement and rising fossil fuel prices. Furthermore, Asian governments provided an additional drive by establishing high goals for renewable energy.
Latin America is expected to register considerable growth during the forecast period. Brazil is leading the regional market and also the 4th position in the world's top 10 solar markets. It made an impressive jump from the 7th spot in 2021 to the 4th spot in 2022. It doubled its prior installed capacity of 5.5 GW to 10.9 GW solar capacity in 2022. The distributed solar systems with 5 MW capacity made up most of the installations, which is close to 8 GW in 2022. Apart from Brazil, Chile is also growing forward in the region, while Mexico saw a decline due to government policies.
Middle East and Africa is estimated to propel at a higher CAGR during the forecast period. It registered the second-fastest capacity increase in global renewable energy. The region's solar energy sector is expected to receive more emphasis and attention in 2023 when the United Arab Emirates hosts COP 28, hence contributing to increased investment and development prospects. Iraq has a potential market due to its high electricity demand in summer and the wide gap between existing capacity and demand. Countries wanting to expand their power mix are UAE, Iran, and Jordan, followed by Qatar, Oman, and Lebanon.
Home solar installations were slowed down due to COVID-19 and its repercussions. The interruptions in the global supply chain are one of the main causes of the price volatility of solar panels. Both household and business solar installations were impacted by the skyrocketing prices, which were followed by a large reduction in production capacity. On the other hand, there was a surge in demand for sustainable energy solutions, which intensified the existing supply-demand mismatch. Moreover, project delays and cost overruns because of late production also had an impact on the solar project’s timely completion. In the first half of 2020, compared to the same time in the previous year, the output of solar panels fell by almost 30 percent, as per industry statistics. Furthermore, the demand and cost of solar panels were driven up by government initiatives and legislation during the pandemic. The solar business has an impressive future despite some immediate difficulties. A notable growth is anticipated in the upcoming years.
Market Key Players:
Market Key Developments:
Frequently Asked Questions
The Global Solar Home Lighting Market is expected to grow with a CAGR of 15.26% between 2024-2029.
The Global Solar Home Lighting Market size is expected to reach a revised size of US$ 23.78 billion by 2029.
FlexSol Solutions, Azuri Technologies, and Sunna Design are the three Solar Home Lighting Market key players.
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