Solar Encapsulation Market Size, Share and Trends

[192 Pages Report] The global solar encapsulation market is estimated to grow from USD 4.9 billion in 2023 to USD 7.2 billion by 2028; it is expected to record a CAGR of 8.0% during the forecast period. Government regulations that encourage research and development and applications such as thin film solar are critical to the growth of the solar encapsulation market. Furthermore, due to the widespread commercialization of solar technology in the region, Japan and South Korea are the leading country-level markets in the Asia Pacific.

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Solar Encapsulation Market Dynamics

Driver: Favorable government incentives and schemes supporting solar installations

Various strategies and initiatives are being implemented by governments around the world to encourage the usage of inverters in industrial applications. The UK government has set a net-zero electricity grid objective for 2035, and it intends to phase out the use of fossil fuels in energy generation. To attain this goal, the country has implemented beneficial policies. The market for distributed PV in Europe has been pushed by government incentives to promote residential and small business PV installations in several countries. To encourage the use of solar PV panels for residential applications, the UK government cut the tax on solar PV panels and other renewable energy-producing items in January 2022. The value-added tax on the installation of home solar PV panel systems has been decreased by 5%. Also, solar energy is being vigorously promoted by countries such as China, Canada, the US, and France.

Restraint: Recycling complexity of solar encapsulations

Solar PV recycling is relatively complex from a technical standpoint. The EoL solar PV module flow is not homogeneous in size, technology, composition or condition. Moreover, existing solar PV panels were not designed to be recycled: durability and performance requirements have led to sandwich-like, sealed and encapsulated structures, making the separation of constituent materials difficult. Solar encapsulation materials, such as Ethylene-vinyl acetate (EVA) or Polyvinyl Butyral (PVB), are often difficult to separate from other components in a solar panel during recycling. These materials are designed to be durable and resistant to environmental factors, making their separation and recovery more challenging. Over time, encapsulation materials can degrade due to prolonged exposure to sunlight and environmental factors. This degradation can make separation even more challenging, and contaminated materials might not meet the required quality standards for reuse. Hence, the lack of established recycling infrastructure and cost-effective recycling processes for these materials limits their reusability, impacting the sustainability of solar panel production which hampers the growth of the solar encapsulation market.

Opportunities: Economic encapsulation techniques

With the continuous cost reduction in solar modules, it is becoming important to incorporate less expensive encapsulation technologies. The cost pressure in the industry may support panel manufacturers to make a switch toward more economical encapsulation strategies. The PV industry is trying to acquire some new encapsulation technologies which have a performance edge as well as cost saving quality. This indicates that there is a genuine opportunity for encapsulant suppliers and manufacturers to derive some improved encapsulant that serves both the above stated requirements and starts a new trend. Although susceptible to UV degradation, EVA remains the most cost-effective encapsulant with good optical properties and adhesion. Consider replacing the front sheet with a cheaper material like fluoropolymer or PET while maintaining EVA at the back for structural stability.

Challenges: Potential Problems with ethylene-vinyl acetate photovoltaic encapsulation

EVA is the most commonly used encapsulating material due to its great mechanical features, such as good light transmittance and flexibility, excellent melt fluidity, adhesive properties, and inexpensive cost. The rising solar energy penetration worldwide, drives market demand for EVA. There are certain disadvantages to using EVA copolymers for encapsulation. When exposed to ambient water or UV radiation, EVA copolymers begin degrading and slowly produce acetic acid, resulting in a decreased pH level and enhanced surface corrosion. Despite this, it creates acetic acid at a relatively slow rate; this decomposition may quickly lead to component deterioration, offering a substantial obstacle to the usage of EVA copolymers in encapsulation.

Solar Encapsulation Market Ecosystem

Well-established, financially reliable Solar encapsulation manufacturers are prominent players in this market. These companies have been in the market for a number of years and have a diverse product range, cutting-edge technologies, and powerful global sales and marketing networks. Mitsui Chemicals, Inc. (Japan), Elkem ASA (Norway), Dow (US), 3M (US), and DuPont (US) are among the industry leaders in this market

The ethylene-vinyl acetate, by materials, is expected to be the largest segment during the forecast period.

This report segments the solar encapsulant market based on type into six types: Ethylene-vinyl Acetate (EVA), Polyvinyl Butyral (PVB), Polydimethylsiloxane (PDMS), Ionomer, Polyolefin, Thermoplastic Polyurethane (TPU). The ethylene-vinyl acetate segment is expected to be the largest segment during the forecast period. EVA copolymers are largely used in food and medical packaging applications due to their non-toxic nature. EVA packaging films exhibit excellent mechanical properties, such as low shrink temperature, greater adhesion, enhanced flexibility, good impact strength, improved puncture resistance, and excellent flex crack resistance. EVA is used in solar modules as an encapsulating agent to provide good radiation transmission and low degradability to sunlight. Also, it is used to form sealing and insulating film around the solar cells.

By technology, crystalline silicon is expected to be the fastest growing during the forecast period.

Based on technology, the solar encapsulation market is segmented into technology into crystalline silicon and thin-film solar technology. The crystalline silicon technology segment is further sub-segmented into mono-crystalline and polycrystalline silicon solar technology. The thin-film solar technology segment is sub-segmented into Cadmium telluride (CdTe), Copper-Indium-gallanium-selenide (CIGS) and Amorphous Silicon. The crystalline silicon technology will exhibit the highest CAGR during forecast period. Monocrystalline cells, also known as single-crystalline cells, are made from single-crystalline silicon. They have a unique appearance as they are often colored and cylindrical. Monocrystalline cells tend to have a higher efficiency level and require less space than other types of solar cells.

"Asia Pacific": The largest in the Solar encapsulation market.

Asia Pacific is expected to have the largest market share in the Solar encapsulation market during the forecast period, followed by Europe. PV module demand is increasing in nations such as China, Japan, India, and South Korea, according to worldwide market participants. India and China are driving the expansion of the PV market in Asia Pacific. These two countries are making rapid growth in the global PV market. Favorable government policies are also aiding the expansion of the Asia Pacific PV industry. According to the International and Renewable Energy Agency (IRENA), rising urbanization and industrialization are boosting energy consumption, providing opportunities for the region's governments to increase their renewable energy potential.

Key Market Players

The solar encapsulation market is dominated by a few major players that have a wide regional presence. The major players in the Solar encapsulation market include Mitsui Chemicals, Inc. (Japan), Elkem ASA (Norway), Dow (US), 3M (US), and DuPont (US)  Between 2018 and 2023. These companies followed strategies such as contracts, agreements, partnerships, mergers, acquisitions, and expansions to capture a larger share of the Solar encapsulation market.

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Scope of the Report

This research report categorizes the solar encapsulation market based on materials, technology, application, and region.

On the basis of materials:

• Ethylene Vinyl Acetate (EVA)
• Thermoplastic Polyurethane (TPU)
• Polyvinyl Butyral (PVB)
• Polydimethylsiloxane (PDMS)
• Ionomer
• Polyolefin

On the basis of technology:

• Crystalline Silicon Solar
• Thin-Film Solar

On the basis of application:

• Ground-mounted
• Building-integrated photovoltaic
• Floating photovoltaic
• Others (Automotive, Construction, and Electronics)

Based on region:

• Europe
• Asia Pacific
• North America
• Rest of the World

Recent Developments

• In February 2021, RenewSys India Pvt. Ltd. launched CONSERV Giga Fast Cure, a revolutionary EVA Encapsulant that can reduce the ‘curing’ stage of module manufacturing by 2-3 minutes per module.
• In January 2021, H.B. Fuller Company announced that the company had completed the acquisition of the U.S.-based Solar Encapsulant business of STR Holdings, Inc.
• In June 2019, Mitsui Chemicals, Inc. inaugurated a new plant to produce its high-performance polyolefin elastomer at its Singapore-based wholly owned subsidiary Mitsui Elastomers.  This move will better serve new markets, such as solar module encapsulation film.
• In June 2019, DuPont announced that the company had added a new brand DuPont Fortasun Solar Silicones. The new silicone-based product line features sealants, adhesives, potting agents, encapsulants and electrically conductive adhesives.

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