Floating Solar: Transforming Water Surfaces into Renewable Energy Hubs

Floating solar photovoltaics (FSPVs), also called Floatovoltaics, harness solar energy from water surfaces and are transforming the renewable energy landscape, particularly in regions where land is scarce. 

Despite their potential, floating solar technology currently trails far behind traditional land-based systems. According to a World Bank report, as of March 2024, the global capacity for ground-mounted solar installations surpassed 1,000 GW, whereas floating solar capacity remained below 10 GW. Nonetheless, there has been a recent surge in global investments in floating solar as a solution to the challenge of expanding solar energy while reserving land for other essential uses.

Why is Land Scarcity an Issue for Solar Deployment?

The expansion of land-based solar power, such as ground-mounted solar farms, is increasingly challenged by rising land acquisition costs. As population density grows, competition for available land becomes more intense, especially in areas with limited space or high property values. This situation not only raises costs but also complicates the land acquisition process for solar projects, as these locations are often prioritised for agricultural, residential, or industrial use.

In densely populated or agriculturally productive regions, this competition limits the availability of large land areas needed for efficient solar farm operations, consequently slowing the growth of conventional solar infrastructure.

How FSPVs Solve this Issue?

Floating Solar Photovoltaics (FSPVs) present an effective solution by removing the need for extensive land use. These systems are designed to float on water bodies such as reservoirs, hydroelectric dams, and man-made lakes. By utilising these water surfaces, FSPVs bypass the issue of land scarcity entirely, making them especially beneficial in urban and suburban areas where space is limited.

Moreover, placing solar panels on water helps reduce evaporation, thus preserving water resources while simultaneously generating renewable energy. This approach maximises the use of existing water infrastructure without competing for land. The water beneath the panels also serves as a cooling mechanism, improving the efficiency of floating systems compared to ground-mounted ones.

FSPVs are particularly appealing to governments and energy developers looking to increase renewable energy capacity without sacrificing land needed for agriculture and urban development. Consequently, the adoption of floating solar is anticipated to grow, meeting the rising demand for clean energy while addressing land availability challenges.

Advantages of Using Floating Solar

Floating solar photovoltaic (FSPV) systems offer distinct benefits over land-based installations. One key advantage is their ability to reduce water evaporation, as panels shade water surfaces, conserving vital resources—especially in arid regions. Additionally, water beneath the panels naturally cools them, boosting efficiency and enabling higher electricity generation compared to conventional systems, which lose efficiency when they overheat.

FSPV systems also have a modular design, making maintenance and cleaning easier, thereby optimising energy output. Since they occupy minimal waterfront space, they have a smaller environmental footprint than traditional farms. Moreover, by covering water surfaces, these systems limit algae growth and water stagnation, positively impacting local ecosystems.

FSPV Market Worldwide

Turning underutilised water surfaces into efficient energy hubs, the global floating solar panels market was valued at USD 35.1 million in 2023 and is expected to grow at a compound annual growth rate (CAGR) of 29.6 percent from 2023 to 2030. 

The falling prices of floating solar technology have significantly boosted its adoption. As costs have dropped considerably in recent years, floating solar has become a more affordable option for both businesses and government agencies. With further price reductions anticipated, demand for this technology is expected to grow rapidly.

Several pilot and commercial-scale floating solar projects have emerged in recent years. For instance, the PlusPower Aqua-z floating solar farm in Singkarak Lake, Indonesia, deployed 22,000 panels in 2022, covering 50 acres, making it one of the largest floating solar facilities in Southeast Asia.

Such large-scale projects are driving the demand for high-quality floating solar panels that can endure corrosion, shading, and rough water conditions over time. Manufacturers are heavily investing in research and development (R&D) to create panels with high-efficiency monocrystalline or polycrystalline cells, robust encapsulation layers, and advanced mooring systems. In 2020 alone, the French Development Agency reported that over USD 25 million was invested globally in floating solar projects, highlighting the growing commitment to this technology.

Region-Specific Trends

The Asia Pacific region, particularly China, leads the global floating solar panels market. China hosts numerous key solar component manufacturers and benefits from a highly competitive manufacturing environment, enabling its producers to offer floating solar panels at affordable prices. This competitive edge has accelerated the adoption of floating solar panel installations across the country. Additionally, various Chinese provincial governments have implemented supportive policies and subsidies, further propelling market growth.

In the South Asia region, floating solar projects are operational in India, the Maldives and Bangladesh, while Pakistan and Sri Lanka are in the early stages of exploration. India boasts of the potential capacities of 280-300 GW in floating solar power. However, only a small fraction of its estimated potential has been installed in the states of Madhya Pradesh, West Bengal, Andhra Pradesh, Kerala, Telangana, Bihar and Rajasthan.

In contrast, the Middle East, specifically the Gulf Cooperation Council (GCC) countries, represents the fastest-growing market for floating solar panels. There is increasing demand in the GCC for large-scale utility projects as well as commercial and industrial solar installations. Panel manufacturers are investing heavily in the region, seizing new project opportunities as the solar market continues to expand. This growth trend is positioning the Middle East as an attractive hub for floating solar panel production and export.

In particular, the UAE has emerged as a key market. The development of the Dubai Electricity and Water Authority (DEWA) Solar Park, one of the largest single-site solar parks globally based on the independent power producer model, has significantly boosted the prominence of solar energy in the country.

Europe and North America are also projected to experience significant growth in the coming decade, driven by initiatives aimed at achieving carbon neutrality targets

Market Drivers 

As previously noted, the Asia Pacific region leads global floating solar installations, thanks to strong governmental support in countries like China, Japan, and South Korea.. Additionally, various market factors are contributing to the increased adoption of floating solar technology.

Mass production, for example, has reduced manufacturing costs by leveraging economies of scale. Furthermore, technological advancements have made solar panels more efficient and cost-effective to produce, accelerating their market penetration.

Government Initiatives & Subsidies

Government incentives and subsidies have been crucial in accelerating floating solar panel installations worldwide. According to a report by the International Renewable Energy Agency (IRENA), over 80 countries implemented various fiscal incentives for renewable energy projects in 2022, with floating solar receiving substantial support.

Countries such as China, India, Japan, and several European nations have introduced attractive fiscal policies and financing options to encourage investment in floating solar projects. For instance, Japan's Ministry of Economy, Trade and Industry offers subsidies covering up to 50 percent of project costs for floating solar deployments. This support has led to the establishment of numerous large-scale floating solar farms across Japan on reservoirs, lakes, and sewage ponds.

Abundant Inland Water Resources - Golden Opportunity 

The vast surface area of water bodies worldwide presents significant opportunities for expanding the floating solar panel market. Many countries and regions with abundant inland water resources are launching large-scale floating solar projects to capitalise on this potential. For example, China, which possesses the world's largest inland water surface area, aims to build 150 GW of floating solar capacity by 2025 to support its renewable energy and carbon reduction targets.

Data from the Food and Agriculture Organization of the United Nations shows that approximately 3.5 percent of the world's land area consists of inland water bodies such as lakes and reservoirs. Utilising this vast, untapped resource for floating solar photovoltaic systems could significantly advance global efforts to meet clean energy targets.

Technological innovations

Technological advancements are making floating solar technology more viable by enhancing durability and reducing costs. Dual-glass photovoltaic technology, for example, offers greater protection, enabling panels to withstand wave action and aquatic conditions with minimal degradation, thus extending their lifespan and reducing long-term costs.

Innovations in anchoring and mooring systems are also being developed to adapt to dynamic water environments. Lightweight, curved panels with integrated flotation reduce ballast needs and simplify deployment, improving efficiency and cutting labour costs. According to the International Renewable Energy Agency, these advancements are expected to drive a five-fold increase in global floating PV capacity, surpassing 10 GW by 2030.

Recent Developments in the Floating Solar Panels Market

In March 2023, Sungrow FPV secured a contract for Indonesia's largest floating solar project, the 192 MW Cirata initiative, demonstrating the technology’s adaptability in challenging environments with water depths of 94 metres and fluctuations of up to 18 metres. In July 2023, Sarawak Energy Bhd partnered with Trina Solar in Malaysia to launch a 71 MW floating solar project at the Batang Ai Hydropower Plant, covering 190 hectares. This initiative highlights Southeast Asia’s growing focus on integrating floating solar with existing hydropower systems for scalable renewable energy.

In Madhya Pradesh, India, the first module of a floating solar system at Omkareshwar was launched in August 2023, aiming to meet the state’s renewable purchase obligations (RPO). The project, operational by the end of 2024, reflects India’s commitment to expanding its energy mix sustainably.

In Thailand, GreenYellow Limited established a 2 MW floating solar plant at SPM Group’s facilities in February 2021, showcasing Thailand's proactive efforts in deploying floating solar technology to boost renewable energy output while efficiently using water resources. These developments underline Asia’s commitment to advancing floating solar technology for sustainable energy solutions.

Top Companies in the Global Floating Solar Panels Market

Notable players in the floating solar panels market include Ciel & Terre International, which is known for its expertise in deploying large-scale floating solar installations, and Hanwha Group, a major player contributing to the development of advanced photovoltaic technologies.

Other prominent companies include JA SOLAR Technology, KYOCERA, and LONGi Solar, all of which are influential in the manufacturing and supply of high-efficiency solar modules for floating systems. Additional important players include Vikram Solar, Trina Solar, Wuxi Suntech Power, Yellow Tropus, and Yingli Solar. 

Overall, floating solar farms not only produce renewable energy but also help conserve water resources and lower carbon emissions, aligning with global climate change efforts. They offer a sustainable solution that merges energy generation with environmental conservation, highlighting the potential of innovative solar technologies in the shift to cleaner energy sources. As governments worldwide accelerate their commitment to renewable energy transitions, floating solar technology will play a vital role in sustainable development with clean energy growth.