Solar Water Heater Market Size, Share and Global Trend By Collector Type (Flat Plate, Evacuated Tube, Unglazed Water), By System (Thermosiphon, Pumped), By Application (Residential, Commercial, Industrial),and Regional Forecast, 2025-2032

The global solar water heater market size was valued at USD 4.2 billion in 2025. The market is projected to grow from USD 4.56 billion in 2026 to USD 8.72 billion by 2034, exhibiting a CAGR of 8.46% during the forecast period. The market growth driven by rising energy costs, accelerating clean-energy adoption, and expanding solar-ready building infrastructure worldwide. The market continues to shift from a modest renewable niche into a mainstream solution for residential and commercial heating needs.

Increasing CO₂ emissions and changing climate have shifted the attention of the world towards the usage of renewable energy sources. Solar energy is among the widely consumed energy source owing to its availability in all parts of the world. Solar energy is harnessed from the sun using solar photovoltaics. Solar energy is mainly used for electricity generation and desalinating or heating water. Solar water heaters are used for heating water using solar energy. The solar water heaters are mounted on the rooftop or in an open space where they can come in direct contact with the sun rays. The solar water heaters aid in cost-saving and are environment-friendly.

The transition is partly economic energy prices have been volatile and partly structural, as governments push national heat-pump initiatives, carbon-neutral building codes, and solar-ready installation mandates that align neatly with solar thermal systems.

In many cases, the purchasing decision is no longer driven purely by environmental sentiment. Large commercial facilities, real-estate developers, and industrial users increasingly view Solar Water Heater systems as long-term cost-control assets. Their interest is being reinforced by maturing collector technologies, higher thermal efficiency, and much better payback periods compared with a decade ago. Even in regions with moderate sunlight, new evacuated tube collectors have produced enough year-round output to justify installation.

Policy incentives, building-energy rating programs, and the global nudge toward decarbonizing heat continue to shape Solar Water Heater market growth. As the industry moves toward 2032, the fundamentals economic, regulatory, and technological point to sustained expansion across residential, commercial, and industrial sectors.

Based on the collector type, the solar water heater is classified as a flat plate, evacuated tube, and unglazed water. The flat plate solar water heater is used mostly in the domestic applications owing to its poor cold weather and high-temperature performance. Wherein, the evacuated solar water heaters are used in domestic as well as industrial applications owing to its high performance in extreme weather conditions. On the basis of application, solar water heaters are used for residential, commercial and industrial purposes. The solar water heaters with capacities around 100 to 500 liters per day are generally used for domestic uses while the solar water heaters with capacities more than 1000 liters per day are used for industrial applications.

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Initiative taken by different countries to promote and increase the usage of renewable energy sources is expected to boost the sales of solar water heaters. Governments of different countries also provide subsidies for solar water heaters in order to reduce the cost and promote the usage of the product. Increasing emissions of gases like CO₂ have adversely affected the climatic conditions owing to which environment-friendly products such as solar water heaters are promoted to reduce the impact of climate change. Cold climatic conditions hamper the efficiency of the water solar heater and are expected to retard the market growth of solar water heaters.

Market Drivers & Trends

Solar Water Heater market trends are being shaped by a mix of energy economics, climate policy, and technology upgrades that have made solar thermal systems more practical than in past cycles. Rising electricity tariffs and fuel price uncertainty have pushed many property owners to revisit the economics of on-site heating solutions. Once installation subsidies or tax credits are added, the payback window often becomes difficult to ignore.

Pressure to cut building-sector emissions plays a major role as well. Many national sustainability roadmaps now label water heating as a priority decarbonization target, especially in regions where residential and commercial heating still depends heavily on fossil fuels. Solar Water Heater market growth also benefits from the fact that solar thermal systems integrate more easily into existing buildings than full HVAC replacements.

On the technology front, the market is seeing stronger differentiation between collector types. Evacuated tube collectors are gaining market share because they perform well in cooler climates and deliver higher thermal efficiency in diffuse sunlight. Flat-plate collectors, meanwhile, remain popular in warmer regions due to their lower cost and durability. Industrial customers are increasingly drawn to pumped systems because they support higher-volume and higher-temperature operations.

Market Segmentation By Collector Type

Flat Plate Collectors

Flat plate collectors remain one of the most widely deployed formats, particularly in regions blessed with consistent sunlight. They have a solid reputation for durability, and many installers appreciate their straightforward maintenance requirements. In practice, flat plate units tend to dominate residential and small-commercial installations, where buyers want predictable performance without navigating overly complex system designs. Their lower upfront cost also contributes to Solar Water Heater market share in cost-sensitive regions.

Evacuated Tube Collectors

Evacuated tube collectors have seen stronger demand over the last decade, especially in climates where winter temperatures dip low enough to disrupt flat-plate performance. Their insulation efficiency provides stable heat output throughout the year, creating an attractive economics profile for users with high-volume or high-temperature needs. Industrial buyers frequently favor this category, not just for efficiency but for modular repair damaged tubes can be replaced without dismantling the entire collector. This segment is expected to contribute heavily to Solar Water Heater market growth as more northern regions adopt solar thermal solutions.

Unglazed Water Collectors

Unglazed collectors are somewhat niche but remain relevant for specific use cases swimming pools, agricultural heating, and low-temperature water needs. Their simple construction and low cost make them appealing where water heating demand is shallow but consistent. The segment rarely competes directly with flat plate or evacuated tube systems but fills a clear functional gap.

Market Segmentation By System

Thermosiphon Systems

Thermosiphon systems continue to dominate solar installations in developing economies because they are mechanically simple, require no pumps, and rely entirely on natural convection. In many cases, their low operational complexity becomes a major deciding factor for residential use. These systems also remain popular in off-grid regions where stable electricity for pumped circulation would be unreliable. Thermosiphon systems contribute significantly to Solar Water Heater market trends in Southeast Asia, Africa, and parts of Latin America.

Pumped Systems

Pumped solar water heating systems are more sophisticated, supporting higher capacity, better flow control, and wider application flexibility. Commercial buildings, industrial facilities, and multi-unit housing complexes tend to prefer pumped systems because they accommodate larger collector arrays and more precise thermal management. Though more expensive than thermosiphon systems, their higher efficiency and scalability make them essential to large-capacity Solar Water Heater industry deployments.

Market Segmentation By Application

Residential

Residential demand has expanded steadily as homeowners seek cost-effective alternatives to electric water heaters. Many residential buyers are motivated by long-term savings rather than immediate returns, which has made subsidies and low-interest green financing important catalysts. Urban real-estate developers increasingly include pre-installed solar water heating to boost property valuation and meet green-building certification criteria.

Commercial

Commercial facilities hotels, hospitals, educational institutions, and multi-tenant buildings typically have predictable, high-volume hot-water usage, making solar thermal systems particularly attractive. This segment is experiencing a surge in retrofit installations driven by rising utility costs and environmental mandates. Commercial adoption accounts for a substantial portion of Solar Water Heater market size in regions like Europe and the Middle East.

Industrial

Industrial facilities with process heating needs (food processing, textiles, chemicals, dairy) are showing greater interest in solar thermal technologies. While industrial adoption is still maturing, the potential is significant due to massive heat demand and increasingly strict sustainability reporting. Many industrial systems combine solar thermal with heat pumps or biomass boilers, creating hybrid systems optimized for reliability and cost control.

Regional Insights

North America Solar Water Heater Market Trends

The North America region is accelerating the process of solar photovoltaic installations. The U.S has installed around 2.7 gigawatts of solar PV in the first quarter of 2019 and is focused on increasing the consumption of solar energy. Owing to which, the market of solar products such as solar PV and solar water heaters is expected to witness steady growth in the region.

North America's Solar Water Heater market growth is influenced by high energy costs, state incentives, and stronger zero-emission building codes. Adoption is increasing in commercial facilities, especially hotels and hospitals seeking long-term operating savings. The U.S. and Canada are also seeing rising retrofit activity as older heating systems reach end of life and property owners pivot toward renewable heat solutions.

United States Solar Water Heater Market 

In the United States, the Solar Water Heater market share is expanding as federal tax credits and state-level solar mandates strengthen adoption. Residential interest remains steady, but the strongest growth is apparent in commercial and institutional projects. Rising electricity prices in coastal states and sustainability commitments from large enterprises continue to accelerate investment in high-efficiency solar thermal systems.

Europe Water Heater Market Trends

The Europe region has witnessed a significant year-on-year growth of around 7% in the installed solar photovoltaics which is expected to have a positive impact on the growth of the solar water heater market in the region.

Europe maintains a mature but steadily growing Solar Water Heater industry. Strict energy-efficiency directives, carbon reduction targets, and building decarbonization policies support sustained market activity. Nations across Southern Europe remain consistent adopters due to high solar availability, while Northern European regions increasingly rely on evacuated tube systems to ensure performance during colder months.

Asia-Pacific Water Heater Market Trends

High population growth and energy requirement in the Asia Pacific region have been the key reasons for the promotion of renewable energy sources. Governments of countries such as India, China, and Australia among others have taken initiatives to provide subsidies for the solar water heater consumers which in turn is expected to drive the solar water heater market in the region.

Asia-Pacific is the fastest-growing region in Solar Water Heater market growth, driven by urbanization, rising construction activity, and strong government push toward renewable solutions. China and India remain key demand centers, while Southeast Asia shows increasing interest due to climate suitability and improving affordability. Commercial and industrial installations are expanding rapidly.

Japan Solar Water Heater Market

Japan’s energy-security concerns and limited land availability make solar water heating valuable for both residential and commercial buildings. High-efficiency evacuated tube collectors are widely used, especially in colder regions. Government incentives and stringent building-energy rules continue to support moderate but steady market expansion.

Latin America Water Heater Market Trends

Latin America’s adoption is rising as energy prices fluctuate and governments advance clean-energy programs. Brazil, Mexico, and Chile lead installations across residential and commercial properties. Hotels and healthcare facilities represent major buyers. Climate suitability and growing interest in solar-ready buildings support long-term demand.

Latin America is expected to be a high potential region for the growth of the solar water heater market in the near future. The Latin America region has doubled the installed capacities of solar PV in the year 2018 owing to which the region is expected to remain lucrative for the sales of solar water heaters in the coming years.

Middle East & Africa Water Heater Market Trends

The Middle East and Africa region are expected to be a high growth platform for the growth of the solar water heater market owing to the favorable climate conditions and the growing consumption of renewable energy in the region.

The Middle East & Africa is witnessing steady Solar Water Heater market growth driven by abundant solar resources and increasing sustainability commitments. Commercial demand remains strong in the hospitality and real-estate sectors. Many African nations deploy solar water systems in community facilities to reduce grid strain and improve energy access.

Competitive Landscape

The Solar Water Heater industry features a mix of global manufacturers, regional specialists, and engineering firms offering tailored thermal solutions. Market competition is shaped by collector efficiency, system durability, installation expertise, and the integration of smart controllers. Companies with strong regional distribution networks tend to outperform rivals due to the importance of installation quality and post-sale service.

Niche companies focus on industrial solar thermal systems, hybrid solutions, and advanced evacuated tube technology. Partnerships between solar manufacturers and real-estate developers are becoming a common route to increase market penetration, particularly in residential and hospitality sectors.

As building codes evolve and carbon-neutral commitments strengthen, vendors investing in product efficiency, digital monitoring, corrosion-resistant materials, and installation automation are gaining competitive advantage. The market will likely consolidate further as global players expand through acquisitions of smaller regional installers and system integrators.

Key Companies Analyzed

Some of the major companies that are present in the global solar water heater market are Apricus Solar Co., Ltd, V-Guard Industries Ltd., Havells India Limited, Jiaxing Passion New Energy Technology Co., Ltd, Sole S.A., Your Home Tech Limited, American Water Heaters, Solar Hot USA, Versol Ltd, SolarPeak New Zealand Limited, The Alternative Energy Company, A.O. Smith Water Products Company B.V., Azuma Solar Corporation, Haining Onosi New Energy Co., Ltd, and GREENoneTEC Solarindustrie GmbH.

SEGMENTATION

 Key Industry Developments

• In June 2019, the Irish Government announced to retrofit around 500,000 homes to make them more energy efficient. The projected is expected to include renewable energy systems such as solar water heating panels, heat pumps, and solar photovoltaic panels
• In February 2019, the Environmental Court to the State of Hawai’i upheld the mandate for the usage of solar water heaters. This decision of the court is expected to promote the environment and climate safety
• In February 2016, Racold Thermo, solar water heater manufacturer announced the launch of its Vacuum Tube Collector solar water heater in the April-June quarter of the year.