Report

Global solar encapsulation market is projected to witness a CAGR of 8.20% during the forecast period 2025-2032, growing from USD 5.05 billion in 2024 to USD 9.49 billion in 2032. The solar encapsulation market has experienced significant growth in recent years due to the global shift toward renewable energy and government incentives encourage the installation of solar systems in different sectors which is expected to maintain a strong pace of expansion in the coming years. Solar encapsulation materials help in protecting photovoltaic (PV) cells from environmental factors. Moreover, solar encapsulation assists in enhancing the durability and efficiency of solar panels which drives its demand in the market. Additionally, upcoming advancements in encapsulation technologies could make materials more lightweight and flexible, which would improve the performance of PV modules and make solar energy more accessible in the market. This, in turn, creates significant growth opportunities for the solar encapsulation market. As countries continue to invest in solar panel production, the demand for lightweight solar encapsulation materials is expected to rise.
For instance, the United States added a record-breaking 9.3 gigawatts (GW) of new solar module manufacturing capacity in Q3 2024 as per the United States Solar Market Insight Q4 2024 report released by the Solar Energy Industries Association (SEIA) in December 2024. The solar module manufacturing capacity increased by opening five new or expanded factories in Alabama, Florida, Ohio, and Texas have increased United States solar module manufacturing capacity to nearly 40 GW. This development highlights rising investment in solar panel manufacturing will contribute to rise in demand for solar encapsulation in the market.
The growing popularity of solar installations in commercial, industrial, and residential sectors also contributes significantly to market growth. Solar installations require durable encapsulation materials in the solar panels to ensure the long-term performance of panels under high-temperature conditions. In addition, increased investment in energy storage solutions drives the need for solar panels in bulk quantities which fuels the demand for solar encapsulation in the next few years. Improving solar panel efficiency at lower costs and making solar power a competitive proposition for various industries creates opportunities for the solar encapsulation market during the forecast period.
Rise in Demand for Renewable Energy Boosts Market Growth of Solar Encapsulation
All sectors are emphasizing the adoption of clean energy resources. The shift towards renewable energy resources like solar energy requires the application of efficient solar encapsulation solutions in the manufacture of solar panels. Solar encapsulations play a key role in improving the efficiency and performance of photovoltaic (PV) modules. Encapsulation ensures long-term performance and minimizes maintenance costs, making it an essential solution for the solar industry. In addition, the rapid growth of utility-scale solar farms and off-grid solar plants is driving demand for effective encapsulation solutions that protect solar panels from external factors such as moisture, UV radiation, and mechanical stress. Furthermore, regional governments and regulatory authorities are planning to invest in large-scale energy storage units to efficiently manage the supply and demand of renewable energy.
Countries are emphasizing the transition toward decarbonization and clean energy, leading to a significant demand for solar energy sources. This, in turn, drives the need for efficient solar panels and increases the demand for solar encapsulation solutions in the market. The growing integration of solar panels with energy storage systems further boosts the need for high-quality encapsulation materials. Additionally, as companies invest in solar panel production, the demand for solar encapsulation continues to rise.
For instance, in October 2024, Gautam Solar announced plans to expand its solar module manufacturing capacity to 5 GW by 2025 in three phases, with completion scheduled for November 2024, January 2025, and in April 2025. As of date the expansion is completed, and the company has reached 5 GW of capacity. With the rising demand for solar energy, companies are investing in the production of solar panels which drive the demand for solar encapsulation in the coming years.
Adoption of Rooftop Solar PV Installation in Commercial and Industrial Sector
The rooftop solar PV installation technology improves operational efficiency, lowers energy costs, and assists the industrial sector in meeting sustainability targets. Commercial sectors are looking to produce in-house electricity which significantly reduces the dependence on the power grid for energy supply. All sectors are prioritizing energy efficiency and sustainability, which drives the demand for high-quality encapsulation materials in the market.
Rooftop solar PV installation assists in stabilizing the power flow in industrial during outages. Moreover, commercial and industrial sectors are under pressure from investors, and government regulatory bodies for the adoption of sustainable practices for power consumption which drive the demand for solar panels in different industrial sectors. The installation of rooftop solar PV technology helps lower carbon emissions and aligns sustainable goals in the commercial sector, fostering greater demand for efficient solar panels which is creating the revenue stream for the solar encapsulation industry in the forecast period. Thus, the commercial and industrial sectors are looking forward to a renewable energy transition, which will continue to accelerate the growth of rooftop solar PV installations in the coming years which market opportunity for solar encapsulation manufacturers in the coming years.
For instance, in April 2025, the Ministry of New and Renewable Energy reported that the cumulative solar power capacity reached 107.95 GW. This includes 17.69 GW from grid-connected solar rooftops, 4.98 GW from off-grid solar, 82.39 GW from ground-mounted solar plants, and 2.89 GW from hybrid projects featuring solar components. This development highlights the rising investment in the deployment of solar panels, creating a market opportunity for the solar encapsulation market in the coming years.
Ethylene-Vinyl Acetate to Dominate the Global Market Share
Ethylene-vinyl acetate (EVA) saw a high uptake rate during the forecast period, leading the segment to control the market. Ethylene-vinyl acetate (EVA) is also used extensively in solar encapsulation applications because of its superior properties and affordability. EVA ensures good adhesion to the glass and the solar cells, which is important for preserving the module's integrity. EVA also has good cushioning and elasticity properties that shield sensitive solar cells from mechanical load and thermal expansion. In addition, high transparency of the EVA material enables maximum transmission of light, thus maximizing the energy output of the solar panel. EVA also provides sufficient resistance to environmental factors which forestalls the degradation of solar cells with time pushing its demand in the market.
Asia-Pacific Leads the Solar Encapsulation Market Share
Asia-Pacific has dominated the solar encapsulation market share and is expected to continue during the forecast period. The Asia-Pacific region has become a leader in global solar encapsulation due to the presence of major countries such as India, China, and Japan. Furthermore, these countries are mainly investing in the production of solar energy production technologies which drive the demand for high-quality solar encapsulation material in the region. China leads as the largest installer of solar panels globally, benefiting from government subsidies and cost-effective production of ethylene vinyl acetate (EVA) films used in solar modules. In addition, the India government is also pushing the industry sector for the adoption of rooftop solar PV installation which boosts the demand for solar panels and contributes rise in demand for solar encapsulation in the market.
Several financial institutions in developing countries provide financial support to the domestic sector for the adoption of solar panels in developing countries. In recent years, India solar sector has experienced robust growth in the production of high-quality solar panels which boosted the demand for solar encapsulation solutions in the country. Moreover, countries in the region are mainly focusing on setting high challenges related to decarbonization and sustainability goals which enhances the demand for solar technologies in the Asia-Pacific region and creates the opportunity for solar encapsulation market growth during the forecast period.
In April 2025, China's installed wind and solar power capacity reached 1.482 billion kilowatts by the end of March 2025, surpassing thermal power capacity for the first time. This milestone underscores China's rapid expansion in renewable energy, with wind and solar installations accounting for over 50% of the nation's total power capacity. In the first quarter alone, wind and solar generated 536.4 billion kilowatt-hours, representing 22.5% of China's total electricity consumption. This achievement reflects China's commitment to decarbonizing its economy and leading global efforts in green energy development.
Future Market Scenario (2025 � 2032F)
� Massive investments in solar infrastructure projects across the region are driving the demand for solar encapsulations in the coming years.
� Governments are focusing on the production of efficient solar panels thus fostering the demand for solar encapsulations in the forecast period.
� The industrial sector heavily investing in the deployment of solar panels which drives the demand for solar encapsulations in the market.
Key Players Landscape and Outlook
Continuous innovation characterizes the landscape of solar encapsulations globally, as the companies compete regarding energy efficiency, product life, and unique features. The market outlook remains positive, owing to increased demand for integrating renewable energy and automation in the industrial sector. Product launches, agreements, business expansions, collaborations, and developing technologies are projected to increase competition in the fast-paced market.
For instance, in March 2023, The Dow Chemical Company expanded its silicone sealant products to offer photovoltaic (PV) module assembly materials. The company launched DOWSIL PV Product Line with six silicone-based sealants and adhesives solutions which could be used to deliver durability and proven performance for frame sealing, rail bonding, junction box bonding and potting, and building integrated photovoltaics (BIPV) installation materials. This development highlights the rising investment in solar material production helped the company to increase revenue and product portfolio.