Solar Encapsulant Market Overview
The global solar encapsulant market is estimated to be valued at $1,036.0 million in 2017 and is projected to reach $4,555.4 million by 2023, witnessing a CAGR of 28.4% during the forecast period. The growing demand for rooftop photovoltaic (PV) modules and rising awareness about the advantages of the solar cell technology are some of the factors driving the market growth of solar encapsulants. Solar encapsulant is a thin-film sheet that protects a solar cell or module from external moisture, dust, and air. It also provides optical and electrical transmissivity to solar modules.
GLOBAL SOLAR ENCAPSULANT MARKET, BY TECHNOLOGY, MILLION SQUARE METERS (2013-2023)
On the basis of material, the solar encapsulant market is categorized into ethylene vinyl acetate (EVA), polyvinyl butyral (PVB), polyolefin elastomer, and others. Other materials include thermoplastic polyurethane (TPU), polydimethylsiloxane (PDMS), and ionomers. In terms of volume, EVA held the largest share in the solar encapsulant market during the historical period and is estimated to account for 74.2% share in the market in 2017. Because EVA offers excellent elasticity and toughness, great adhesive strength, and strong protection to solar cells against corrosion and delamination, it is preferred over other encapsulating materials for solar cell production.
On the basis of technology, the solar encapsulant market is categorized into crystalline silicon solar technology and thin-film solar technology. The thin-film solar technology is further divided into cadmium telluride (CdTe), copper indium gallium selenide (CIGS), and amorphous silicon (a-Si). During the forecast period, the thin-film solar technology is expected to be the faster-growing technology in the solar encapsulant market, registering CAGRs of 23.0% and 28.7% in terms of volume and value, respectively. Increasing focus of key players on production capacity expansion for thin films to meet the growing demand is expected to boost the use of the thin-film solar technology.
Based on application, the solar encapsulant market is categorized into automotive, construction, electronics, and others. Other applications include aerospace and defense. Construction is expected to continue being the largest application area for solar encapsulating materials in the market in the coming years, owing to the high demand for PV modules from residential and commercial sectors.
Geographically, Asia-Pacific (APAC) is expected to continue being the largest and fastest-growing solar encapsulant market in the coming years. The market in the region is driven by an increase in the production capacity for solar modules by key manufacturers in China and India. For instance, according to the National Energy Board data for the year 2016, China expanded its installation capacity for PV power generation by 34.54 gigawatt (GW).
Solar Encapsulant Market Dynamics
The major trend identified in the solar encapsulant market is the emergence of the thin-film solar cell technology. Besides, the growing demand for PV modules is a key factor driving the market growth.
Crystalline silicon solar technology is commonly used in building crystalline silicon solar modules. However, the high production cost and the fragile nature of crystalline silicon-based solar modules have led to the need for cost-efficient solar module production technologies. Thus, manufacturers are focusing on developing less expensive and improved technologies for solar module production. An emerging technology in the solar encapsulant market is the thin-film solar cell technology. The major advantage of the thin-film solar cell technology over the crystalline silicon solar technology is its cost. Mass production of solar cells is more economical using the thin-film solar cell technology.
The most widely used solar cell technology is PV, wherein there is direct conversion of sunlight into electrical energy through a device called solar cell. Solar encapsulating materials are used to provide adhesion between the top and the rear surfaces of the PV module in order to protect the module from high temperature, moisture, and external stress. The demand for PV modules is growing owing to their benefits such as economic viability, environmental sustainability, and clean green energy.
Many countries have increased their production capacity for PV modules owing to these factors. For instance, according to the China Photovoltaic Industry Association (CPIA), in 2016, China increased its solar panel production capacity to 48 GW, which is expected to reach 110 GW by 2020. Hence, continuous efforts of solar material manufacturers toward increasing their solar production capacity are expected to boost the solar encapsulant market growth.
Degradation of solar encapsulating material reduces its efficiency in protecting the solar module. Exposure of encapsulant materials, such as EVA and polyolefin elastomer, to moisture and corrosion results in the browning and deterioration of these materials. Degradation of the solar encapsulating material decreases the ultraviolet (UV) absorption ability of the encapsulant, which results in significant power loss. Hence, degradation of the solar encapsulating material is a factor hindering the solar encapsulant market growth.
Solar Encapsulant Market Competitive Landscape
Some of the major players operating in the global solar encapsulant market are Hangzhou First Applied Material Co. Ltd., Changzhou Sveck Technology Co. Ltd. (Sveck), RenewSys India Pvt. Ltd. (RIPL), STR Holdings Inc., Encapsulantes de Valor Añadido S.A. (EVASA), E.I. du Pont de Nemours and Company, Jiangsu Akcome Science & Technology Co. Ltd., Saint-Gobain S.A., ISOVOLTAIC AG, Eastman Chemical Company, Bridgestone Corporation, Mitsui Chemicals Inc., and 3M Company.