Off-grid Solar Power Systems Market by Type, Application and Geography - Forecast and Analysis 2023-2027

Off-grid Solar Power Systems Market Forecast 2023-2027

The off-grid solar power systems market is estimated to increase by USD 3.26 billion, growing at a CAGR of 11.92% between 2022 and 2027. Market expansion hinges on multiple factors, such as the exorbitant expenses associated with grid expansion, escalating government backing, and the growing embrace of hybrid power setups. However, impediments to market growth include the steep initial cost of photovoltaic (PV) systems, subpar efficiency levels of solar power, and limited awareness regarding alternative sustainable technologies.

What will be the size of the Off-grid Solar Power Systems Market During the Forecast Period?

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Market Segmentation

This report extensively covers market segmentation by type (AC and DC), application (non-residential and residential), and geography (APAC, Europe, Middle East and Africa, North America, and South America). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.

By Type

The market share growth by the AC segment will be significant during the forecast period. In this segment, utility-scale projects have gained large traction owing to the shift in focus on sustainable sources along with several agreements in recent years, including the Paris Agreement on Climate Change. Increasing demand for electricity due to the rise in population will significantly propel the utility segment of the global market. Solar PV technology is a low-cost source of power generation and has been a primary investment focus for investor-owned as well as public utilities. The declining cost of solar electricity generation is a major factor driving the growth of the segment. Thus, all these factors will drive the growth of the market in focus during the forecast period.

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The AC segment was valued at USD 2.68 billion in 2017 and continue to grow by 2021. AC segment comprises inverters and backup generator gen-sets. A utility-scale plant is one that generates power and feeds it into the main grid. Solar inverters are the mainstay of the utility-scale industry. Customers are exploring only central inverters for utility-scale projects where the land is flat. While central inverters have always been 1,000 V rated. Other types of inverters, namely string inverters, have high operations and maintenance (O&M) costs and capital expenditure, making central inverters the most likely solution for utility-scale projects. Such things will increase the market growth during the forecast period.

By region

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APAC is estimated to contribute 48% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. There are millions of people in Asian countries without access to grid electricity. This can be attributed to poor economic conditions, lack of financing, high infrastructure costs, or environmental structure, which prohibits the development of a conventional power grid. Individual off-grid systems have the potential to accelerate the electricity access rate. Driven by new business models and reduction in technology costs, households are motivated to adopt off-grid systems that generate power by themselves. Thousands of home systems are being purchased, and hundreds of renewable-based mini-grids are being adopted to increase electricity access in the region. Such factors will increase the market growth during the forecast period.

Market Dynamics and Customer Landscape

The market is being propelled by the increasing demand for electricity and the limitations of the traditional electrical grid to meet this demand efficiently. With the capability to generate electricity independently of the grid, they utilize photovoltaic (PV) panels to harness solar energy and convert it into electricity, providing a realistic and sustainable solution for energy access, especially in remote areas. Modern off-grid technologies, coupled with expanded PV panels and electricity storage systems, offer households the opportunity to power their appliances with environmentally friendly energy sources, reducing reliance on fossil fuels and lowering greenhouse gas emissions.

Moreover, favorable monetary incentives such as tax breaks and subsidies, combined with technological advancements that have led to a decrease in costs, are driving the widespread adoption. Supportive policies and initiatives further encourage consumers to invest in these systems, offsetting upfront costs associated with purchasing, installing, and modifying integral infrastructure. As a result, the market is experiencing significant growth, with increasing momentum towards sustainable energy solutions and renewable sources.

Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Key Market Driver

The rising cost of grid expansion is a primary driver propelling the global market forward. Grid extension expenses for rural electrification are substantial and contingent on various factors such as distance from the existing grid, population density, and power demand patterns. Consequently, governments and communities are increasingly turning to decentralized energy solutions to power remote households and communities. Off-grid systems emerge as the most cost-effective option for sparsely populated areas, offering standalone solutions capable of powering individual households with electricity for basic needs like lighting, television, and mobile phone charging. Moreover, these systems are scalable to accommodate growing energy demands, enabling the addition of appliances like refrigerators and pumps. This trend is expected to drive market focus and growth in the forecast period as off-grid becomes a more realistic and sustainable solution for expanding energy access in remote areas.

Significant Market Trend

The continuous decline in technology costs is the primary trend in the global market. No one strategy fits every country in increasing electricity access; thus, in developing countries, off-grid and mini-grid solutions complement in accelerating the energy access process, where a grid connection is too expensive. Electricity access through the grid extension is the major and has been the dominant way of giving millions access to electricity.

However, technologies such as batteries, PV for a power source, and LED for lighting, which are the major components of a stand-alone power system, have witnessed a continuous decline in costs. Decentralized energy systems are increasingly gaining prominence in energy access efforts, as the declining costs have made these systems accessible and affordable and helped millions who did not have access to benefit from electricity access. Thus, it is expected that the declining cost of technology will drive the adoption as a cost-effective source to provide energy access to the population in remote areas.

Major Market Challenge

Low awareness about alternative sustainable technology is a major challenge to the growth of the global market. One big obstacle that off-grid renewable systems face is the need for them to compete with well-established power sources such as diesel generators. Diesel-based mini-grids are one of the oldest forms of stand-alone systems used to provide power to remote communities and industries. They can be used as stand-alone systems in off-grid applications when they are combined with energy storage systems. The excess energy from solar systems can be stored in a battery for night-time operations.

However, in many rural areas, where grid power is non-existent or unreliable, diesel-powered generators are the first choice of power source, and renewable power systems are often ignored. This is a huge challenge, as renewable energy combined with energy storage can be a sustainable and economically viable option, which can eliminate the dependency on fossil fuels. The rural sector offers a sizeable market for energy storage deployment. However, it is a less desirable option owing to the lack of knowledge and the high cost of installing off-grid energy storage systems. Thus, the preference for traditional diesel systems over renewable technology is a major barrier to the market.

Key Market Customer Landscape

The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.

Global Market Customer Landscape

Who are the Major Off-grid Solar Power Systems Market Companies?

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Gem Energy AU - The company offers off-grid solar power systems such as off-grid solar inverters. Also, through this segment, the company offers Solar Panels, Solar Inverters, LED Lighting, Batteries, Mounting Equipment, and other products.

The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:

• ABB Ltd.
• AKUO ENERGY SAS
• Azuri Technologies Ltd.
• Canadian Solar Inc.
• EnerSys
• ENGIE SA
• Greenlight Planet
• Havells India Ltd.
• JinkoSolar Holding Co. Ltd.
• Kirloskar Proprietary Ltd.
• M KOPA
• OMC Power Pvt. Ltd.
• Oolu LLC
• Powerhive Inc.
• Schneider Electric SE

Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.

Segment Overview

The report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027. 

• Type Outlook 
  • AC
  • DC

• Application Outlook
  • Non-residential
  • Residential

• Region Outlook 
  • North America
    • The U.S.
    • Canada
  • Europe
    • The U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
  • South America
    • Chile
    • Argentina
    • Brazil
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa

Market Analyst Overview

The market is witnessing significant growth driven by the increasing demand for clean and reliable energy sources, especially in remote and underserved areas. With expanded photovoltaic (PV) panels and environmentally friendly appliances, off-grid solar systems offer a sustainable solution to mitigate climate change and reduce carbon footprints. These systems provide continuous and uninterrupted power supply, promoting energy independence and sustainability objectives. Moreover, off-grid energy usage is gaining traction across various sectors, including residential, commercial, and healthcare, with applications ranging from vaccine storage to telemedicine initiatives. Despite challenges such as funding availability decline, the market remains resilient and adaptable, offering critical services and contributing to the world's energy mix by harnessing plentiful sunshine and addressing grid failures and power outages in rural locations.

The OFF-Grid Solar Market is experiencing growth driven by the adoption of modern off-grid solar technologies and the increasing recognition of solar power as a reliable renewable energy source. This market caters to both commercial and residential sectors, providing clean and reliable energy solutions that contribute to mitigating climate change. Key components of off-grid systems include direct current (DC) and alternating contemporary (AC) technologies, household appliances, and modern off-grid technologies. As regulatory frameworks support renewable energy initiatives, costs associated with equipment, labor, and transportation are decreasing, leading to long-term price savings for consumers.

Integral infrastructure modifications are underway to accommodate off-grid solar installations, with benefits including clean power generation and resilience against energy disruptions. Projects such as the PowerChina SEPCO III's involvement in the Red Sea Project highlight the growing interest in off-grid energy storage and solar power installations for commercial purposes. However, challenges persist, including a decline in funding availability from financial institutions and the need to meet environmental standards. Despite these challenges, the surge in energy demand, particularly in sectors like healthcare facilities and construction activities, underscores the importance of reliable and sustainable energy solutions. The off-grid solar industry segmentation includes controllers, solar panels, photovoltaic cells, and other associated equipment. As the solar photovoltaic sector continues to expand, both commercial electricity and residential categories are benefiting from the construction of off-grid solar installations. Overall, the OFF-Grid Market offers a promising opportunity for clean energy adoption and economic growth.

Off-grid Solar Power Systems Market Scope
Report Coverage	Details
Page number	165
Base year	2022
Historic period	2017-2021
Forecast period	2023-2027
Growth momentum & CAGR	Accelerate at a CAGR of 11.92%
Market growth 2023-2027	USD 3.26 billion
Market structure	Fragmented
YoY growth 2022-2023(%)	11.04
Regional analysis	APAC, Europe, Middle East and Africa, North America, and South America
Performing market contribution	APAC at 48%
Key countries	US, Kenya, China, India, and Indonesia
Competitive landscape	Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks
Key companies profiled	ABB Ltd., AKUO ENERGY SAS, Azuri Technologies Ltd., Canadian Solar Inc., EnerSys, ENGIE SA, Gem Energy Australia Pty Ltd., Greenlight Planet, Havells India Ltd., JinkoSolar Holding Co. Ltd., Kirloskar Proprietary Ltd., M KOPA, OMC Power Pvt. Ltd., Oolu LLC, Powerhive Inc., Schneider Electric SE, SMA Solar Technology AG, SunPower Corp., Tata Sons Pvt. Ltd., and Vector Ltd.
Market dynamics	Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, market trends, market growth analysis, market research and growth, market research report, market growth and forecasting, Market forecasting , COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period.
Customization purview	If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized.

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What are the Key Data Covered in this Off-grid Solar Power Systems Market Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the growth of the off-grid solar power systems market between 2023 and 2027
• Precise estimation of the off-grid solar power systems market size and its contribution to the parent market
• Accurate predictions about upcoming trends and changes in consumer behavior
• Growth of the market across APAC, Europe, Middle East and Africa, North America, and South America
• Thorough analysis of the market’s competitive landscape and detailed information about vendors
• Comprehensive analysis of factors that will challenge the growth of off-grid solar power systems market vendors

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