No. Solar thermal still delivers 400–500 kWh of heat per m² a year — two to three times what the same roof yields as PV electricity — and 544 GWth of collectors supply 443 TWh of heat worldwide. The market has shifted rather than disappeared: single-family sales slowed in parts of Europe as PV prices fell, while Türkiye, Mexico, Brazil and industrial process heat keep growing, and hotels, apartment blocks and families replacing electric water heating in sunny climates keep choosing it.
Has solar thermal really declined?
In parts of the market, yes. New solar thermal capacity installed worldwide fell 14.2% in 2024, to 17.8 GWth, and EurObserv'ER recorded −32.1% in the EU, to roughly 1.29 million m² newly installed — mostly single-family systems. Over the same period solar heat for industrial processes grew 28% and Türkiye, Mexico and Brazil posted double-digit growth: the market is moving rather than vanishing.
The installed base tells the other half of the story. 544 GWth of collectors are in service globally, delivering 443 TWh of heat a year and avoiding 153.5 Mt of CO2.
Why did PV take share in single-family homes?
Because module prices collapsed, and in cool climates a household with a large roof and modest hot water use can heat some of its water with surplus PV electricity. The comparison is closer than it looks: per square metre a collector delivers two to three times more energy as heat, and in sunny markets a thermosiphon kit supplies hot water at roughly €0.05–0.07 per kWh over its life, including servicing — far below the €0.29/kWh EU-average electricity price (Eurostat, H2 2025). Where both outputs are wanted from one roof, PVT hybrid panels combine them.
Solar thermal also lost its subsidy advantage. The UK's Renewable Heat Incentive closed, and several European schemes that once funded collectors now fund heat pumps first. Several major schemes still fund collectors — Italy's Conto Termico 3.0 covers up to 65% and Germany's BEG 30% — see solar thermal subsidies in 2026.
Where does solar thermal still beat PV?
| Application | Better technology | Why |
|---|---|---|
| One house, big roof, cool climate, low hot water use | PVT, or a heat pump water heater | Electricity and heat from one roof, or hot water with no roof at all |
| Hotel, gym, laundry, hospital, apartment block | Solar thermal | Large, steady, year-round demand; roof area per litre is the constraint |
| High irradiation with electric water heating | Solar thermal | Displaces expensive electric heat at 400–500 kWh/m² |
| Industrial process heat below 150 °C | Solar thermal | Direct heat at temperature; SHIP plant capacity grew 28% in 2024 |
| District heating | Solar thermal | 346 solar district heating systems in operation, around 2 GWth |
| Small roof needing power and heat | PVT hybrid | Both outputs from the same square metre |
The pattern is consistent: solar thermal wins where hot water demand is large, sunshine is strong or roof area is scarce — which is why it is growing at double-digit rates in Türkiye, Mexico and Brazil even as single-family sales in Germany have slowed.
What is the manufacturer's own advice?
Solimpeks has built solar thermal collectors since 2001 and PVT hybrid panels since 2008, and the advice follows the building. For a 40-room hotel on the Mediterranean, a laundry, an apartment block with a shared cylinder, or a family replacing an electric water heater in a sunny climate, solar thermal is not merely competitive — nothing else converts that much roof into that much heat. For a small household in a cool climate that already owns PV, a heat pump water heater or PVT may be the better first step.
Both statements are true at the same time. "Is solar thermal dead?" is the wrong question. "Is my hot water demand large, steady and area-constrained?" is the right one.
What could change the picture before 2030?
Three policies push the other way. The EPBD solar mandate treats solar thermal and PVT as eligible technologies alongside photovoltaics, which puts collectors back into non-residential specifications from 2026. ETS2, now starting in 2028, prices carbon into gas and heating oil — around €50 per tonne adds roughly 1 cent per kWh of gas. And RED III requires a binding +1.1 percentage-point annual rise in the renewable share of heating and cooling from 2026 to 2030, a target heat pumps alone will struggle to meet.
All of it strengthens the case for solar heat — most of all in the segments where it already wins.
Frequently asked questions
Is solar thermal still worth installing in 2026?
Yes, wherever hot water demand is steady. For hotels, gyms, apartment blocks and laundries it remains the highest-yield technology per square metre, and for family homes replacing electric or LPG water heating in sunny climates it typically pays back in 3–6 years. For a two-person house in a cool climate, a heat pump water heater or PVT may suit better.
Should I replace my old solar thermal panels with PV?
Not if the collectors still work. A fluid change, a new pump and a controller cost a small fraction of a new array, and a well-built collector runs 25–30 years. Replace only when the absorber or the tank coil has actually failed.
Why did the solar thermal market decline?
Three reasons at once: photovoltaic module prices collapsed, subsidy schemes shifted their budgets to heat pumps, and gas remained cheap in the markets where solar thermal was strongest. The decline is a change in relative economics, not a technical failure.
Is solar thermal growing anywhere?
Yes. IEA SHC reports double-digit growth in Türkiye, Mexico and Brazil, solar heat for industrial processes up 28% in 2024, and a stable solar district heating segment of roughly 2 GWth across 346 systems. Growth has moved to high-irradiation and large-load markets.
Does the EU still count solar thermal as a renewable heating technology?
Yes. The recast EPBD solar mandate names solar energy installations generally, covering solar thermal and PVT as well as photovoltaics, and RED III counts solar thermal towards binding renewable heating targets.