Renewable energy sustains growth in European solar thermal systems market

DUBLIN, IRELAND: Research and Markets has announced the addition of Frost & Sullivan's new report "European Solar Thermal Heating Systems Market" to its offering.

The market for solar thermal systems (STS) in Europe has witnessed major developments at all levels in the last four years. Policy makers, market participants and end users have given greater attention to STS, ensuring a high growth potential. Due to its tremendous long-term growth prospects, this market has attracted several new participants that are playing a central role in promoting the industry.

"Currently, the key driver for the market in Europe is government support for STS in the form of financial subsidies, tax credits, and regulatory reforms," says the analyst of this research. "The market for STS is highly responsive to fluctuations in the provision of governmental support."

For instance, the Italian market witnessed strong growth levels following increased government subsidies for STS. On the other hand, the German market declined significantly as a direct result of a temporary disruption to these subsidies and recovered as soon as they became available again.

High growth in the STS market, particularly over the last four years, has attracted several new participants that are promoting the industry and making STSs accessible to a wider customer base.

Develop low-cost, STS to curb prices
Cost is the primary hurdle confronting the STS market. Despite the financial incentives that the solar thermal installations receive, the overall price is still high and the recoup period can go up to 20 years in some regions.

Additionally, a STS is only a complementary alternative and not a substitute for a traditional hot water system. Therefore, it is not a viable investment option for most end users, especially in countries where conventional energy prices are low. "In many countries, particularly in northern Europe, the solar yield can be as little as 40 per cent," explains the analyst. "Additionally, the up-front cost of a solar thermal system continues to be expensive."

Companies should work on developing low-cost and effective solar thermal systems, particularly in the current economic conditions in Europe. On the whole, with escalating competition, both manufacturers and installers will be forced to reduce prices and the overall price of STS will go down.