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Energy crisis drives boom in home solar and battery markets across Europe 

Summary

- Europe saw a 64% increase in residential solar uptake last year and 83% increase in residential battery installations
- Surging growth will continue across both markets in the period to 2030 
- Significant opportunities for investors and new players to ride this growth wave

12 July 2023 –  Across Europe, over 1.8 million homes installed a solar PV system in 2022, an increase of 64% from the previous year. 455,000 homes also installed a residential battery system – the vast majority of these being installed alongside a new PV system. In total, there are now circa 10 million residential PV systems installed across Europe, and over 1.1 million residential batteries.  

Data from LCP Delta shows that there is a growing trend of consumers investing in both types of technology, with 1-in-4 PV systems now being sold with a battery across Europe. The drivers for this trend are: 

  • consumers looking to protect themselves from ongoing volatility in the energy market 
  • the shift away from Feed-in-Tariffs and net metering schemes 
  • an increasing focus on self-consumption optimisation 

 

The report from LCP Delta suggests that this could be a watershed moment for the domestic PV and battery markets, with greater uptake helping to bring capital expenditure costs down and making the switch more financially sustainable for many consumers who want to protect themselves from future energy price fluctuations whilst switching to a greener form of electricity.  

By the end of this decade, LCP Delta estimates that annual sales of residential solar PV and batteries across Europe will reach 2.7 million per year and 622,000 per year respectively. By 2030, the solar PV installation market for units of less than 10kW could reach €24 billion per year. LCP Delta’s analysis also examined the future market potential of ten key solar markets and twelve battery markets. 

Commenting on the outlook for the residential solar PV market, Dina Darshini of LCP Delta said: “The outlook is bright. We expect the market to grow by 50% between 2022 and 2030 in terms of annual installations. The basis for continued growth over the next 8 years include customer fear of further retail energy price hikes and price volatility, falling solar equipment costs, increased electrification of the home and transport, policy incentives and regulatory requirements, market player push, and more.” 

“We also expect the supply market to become increasingly competitive. A race to scale has already begun. There is huge scope for private investors to play their part in the energy transition by offering risk finance to attractive start-ups. We are already seeing large amounts of capital being raised by new market entrants, from 10s to 100s of million per financing round. And there are even examples of young private businesses gaining the coveted “unicorn” status with company valuations of over US$1 billion. Between now and 2030, we are likely to witness consolidation in the supply market, with opportunities galore for mergers and acquisitions.”  

Looking at the growing market for battery storage in homes, Darshini added: “The battery market is entering its early growth phase as more operators come into the market and the number of suitably qualified installers gradually increases. However, for the market to reach the next growth phase there is scope for policy initiatives to help increase uptake from households. For example, in Italy homeowners can get access to government subsidies which cover 90% of the cost of battery storage as the government encourages uptake.  

“We expect further growth in this sector will be from the mass uptake of heat pumps and EVs, which will put further financial pressure on domestic energy bills and incentivise more people to adopt domestic PV systems. Energy security is a high priority for the public, so if it is financially viable, it makes sense that consumers will want to take ownership of their domestic energy use in the long-term rather than be subject to the fluctuations of the market.”   

Notes to editors

LCP Delta’s data analysis provides an overview of: 

  • Residential battery storage installations (by unit, power capacity and storage capacity), regulatory context and other key market metrics in Europe with a focus on the residential sector and highlights 14 core countries. It also analyses how residential battery storage is connected in Home Energy Management Systems (HEMS) to enable additional value streams and summarises the current landscape of competitors in the European market. 
  • European residential solar PV (<10kWp) market out to 2030, with deep-dive analysis of ten countries: Germany, Netherlands, Belgium, Italy, Spain, United Kingdom, Portugal, France, Poland, and Sweden. The analysis includes data on annual installations, installed based, and average solar PV system size commentary on market trends, policy and regulatory landscape, as well as competitive landscape. 

 

About LCP Delta

LCP Delta™ is a trading name of Delta Energy & Environment Limited and Lane Clark & Peacock LLP. LCP Delta™ combines the expertise of LCP Energy and Delta-EE to provide a single partner across the whole energy value chain. We are a team of passionate people using data, primary research, insights, analysis and models embracing advanced technology and innovation to accelerate the energy transition globally. Find out more here 

Media contacts

Matthew Whitbread or Jessica Beaumont, Instinctif Partners, LCP@instinctif.com 

 

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