Polysilicon Market Analysis

Regulatory Support Is Boosting The Market

In 2023, REC Silicon ASA declared that Hanwha Q Cells Georgia, Inc., a fully owned subsidiary of Hanwha Solutions, and its subsidiary, REC Solar Grade Silicon LLC, will be engaging into a supply deal. The new Qcells manufacturing plant in Georgia, set to open late next year, will use American-made, low-carbon polysilicon produced at REC Silicon's Moses Lake factory in Washington to manufacture ingots and wafers. High purity granular polysilicon from a fluidized bed reactor (FBR) is the subject of a 10-year take-or-pay supply agreement.

Some have heralded FBR technology as a way to make polysilicon for solar energy at a quarter of the cost and energy consumption of the industry-dominant Siemens technique.

A five-year contract to buy 70,000 tons of polysilicon, the basic material used in PV modules, was inked in 2021 by Chinese solar maker JinkoSolar and German supplier Wacker. Next month, the supply of the polysilicon, which is produced at Wacker facilities in Germany and the United States, will start, and the agreement will last until December 2026.

The burgeoning electric vehicle (EV) market is indirectly influencing the Global Polysilicon Market Industry. As the demand for EVs rises, so does the need for efficient energy storage solutions and solar charging infrastructure. Polysilicon is integral to the production of solar panels, which are increasingly being integrated into EV charging stations. This synergy between the EV and solar sectors is expected to drive polysilicon demand, as more consumers and businesses seek sustainable energy solutions. The interconnection of these markets suggests a multifaceted growth opportunity for polysilicon manufacturers in the coming years.

Supportive government policies and incentives play a crucial role in shaping the Global Polysilicon Market Industry. Many countries are implementing favorable regulations and financial incentives to encourage the adoption of solar energy technologies. For instance, subsidies for solar panel installations and tax credits for renewable energy investments are becoming more prevalent. These initiatives not only stimulate demand for polysilicon but also foster a conducive environment for market players to invest in capacity expansion. As a result, the market is poised for robust growth, with a projected compound annual growth rate of 12.51% from 2025 to 2035.

The Global Polysilicon Market Industry is experiencing a notable surge in demand driven by the increasing global emphasis on renewable energy sources. As countries strive to meet their carbon neutrality goals, the adoption of solar energy technologies is expanding. This trend is reflected in the projected market value of 15.2 USD Billion in 2024, as more solar photovoltaic systems are deployed. Governments worldwide are implementing policies and incentives to promote solar energy, which in turn fuels the demand for polysilicon, a critical component in solar cells. This shift towards sustainable energy solutions is likely to sustain growth in the polysilicon sector.

The ongoing global energy transition is a pivotal driver for the Global Polysilicon Market Industry. As nations pivot away from fossil fuels towards cleaner energy alternatives, the demand for solar energy is expected to rise significantly. This transition is supported by international agreements aimed at reducing greenhouse gas emissions, which further propels the need for polysilicon in solar cell production. The market is likely to benefit from this shift, with projections indicating a substantial increase in market value over the next decade. The alignment of energy policies with sustainability goals is expected to create a favorable landscape for polysilicon producers.

Technological innovations in polysilicon production processes are enhancing efficiency and reducing costs, thereby driving the Global Polysilicon Market Industry. Advanced manufacturing techniques, such as fluidized bed reactors and improved purification methods, are enabling producers to achieve higher purity levels and yield rates. These advancements not only lower production costs but also improve the overall performance of solar cells. As a result, manufacturers are better positioned to meet the increasing demand for high-quality polysilicon. This trend is expected to contribute to the market's growth trajectory, with projections indicating a market size of 55.6 USD Billion by 2035.

By region, the study provides market insights into North America, Europe, Asia-Pacific, and the Rest of the World. Asia Pacific dominates the market, accounting for a significant share of the global market demand. This is mainly due to the increasing production and consumption of electronic devices and the growing demand for solar energy in the region. China is the largest consumer and producer of polysilicon in the world, with a significant number of polysilicon production facilities located in the country.

Other countries in the Asia Pacific, such as Japan, South Korea, and Taiwan, also have a significant presence in the market, with a large number of semiconductor and solar cell manufacturing facilities located in the region. In addition to the increasing demand for electronic devices and solar energy, favorable government policies and incentives for the development of renewable energy sources have also been driving the growth of the market in the Asia Pacific region.

Figure 3:  POLYSILICON MARKET SHARE BY REGION 2022 (%)

Source: Secondary Research, Primary Research, Market Research Future Database, and Analyst Review

Major market players are spending a lot of money on R&D to increase their product lines, which will help the market grow even more. Market participants are also taking various strategic initiatives to grow their worldwide footprint, with key market developments such as new product launches, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations. Competitors in the Polysilicon industry must offer cost-effective items to expand and survive in an increasingly competitive and rising market environment.

Manufacturing locally to cut operating costs is one of the main business tactics manufacturers use in the global Polysilicon industry to benefit customers and expand the market sector. Major market players, including Kirloskar, Generac Power Systems Inc, Caterpillar, REC Silicon, Tokuyama Corporation, and others, are attempting to increase market demand by funding R&D initiatives.

Kirloskar Electric (KEC) is a provider of electrical engineering services. It manufactures transformers, switchgear,  generator, electronics, motors, and other products. The company caters to power generation, transportation, transmission and distribution, and renewable energy sectors.

A producer of power products is Generac Power Products (also known as Generac Power Systems). It provides a variety of goods, including pressure washers, trimmers, mowers, and portable, RV, residential, commercial, and industrial generators.