Solar thermal is a relatively new technology which has already shown enormous promise. It is a larger energy source than is commonly perceived. Low and medium temperature collectors solar thermal currently have a far higher installed energy capacity than CSP (concentrated solar power) collectors used to generate electricity, and also far higher than the installed capacity of solar PV.
In comparison, by 2009 there was 147,000 MW of wind power, 174,000 MW of solar thermal collectors for water heating and building heating or cooling installed, 17,000 MW of solar PV capacity, but only about 1,000 MW of high temperature solar thermal collector generating capacity. With few environmental impacts and a big resource, it offers an opportunity to the sunniest countries of the world, similar to that currently benefiting European nations with the windiest shorelines. Solar thermal power uses direct sunlight, so it must be sited in regions with high direct solar radiation.
Among the climatically most promising areas of the world are the South-Western United States, Central and South America, Africa, the Middle East, the Mediterranean countries of Europe, Iran, Pakistan and the desert regions of India, the former Soviet Union, China and Australia. In contrast, solar photovoltaic cells use both direct and indirect, diffuse solar radiation and they are suitable in areas with indirect, diffuse solar conditions, such as many north European regions and is more effective in cold conditions.
In many regions of the world, one square kilometre of land is enough to generate as much as 100-200 GWh of electricity per year using solar thermal technology. This is equivalent to the annual production of a 50 MW conventional coal or gas-fired power plant.