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Phase Change Materials Market

The market for Phase Change Materials was estimated at $813 million in 2025; it is anticipated to increase to $1.88 billion by 2030, with projections indicating growth to around $4.36 billion by 2035.

Report ID:DS1310004
Author:Vineet Pandey - Business Consultant
Published Date:
Datatree
Chemicals & Materials
Specialty Materials
Phase Change Materials
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Report Summary
Market Data
Methodology
Table of Contents

Global Phase Change Materials Market Outlook

Revenue, 2025

$813M

Forecast, 2035

$4.36B

CAGR, 2026 - 2035

18.3%

The Phase Change Materials (PCMs) industry revenue is expected to be around $813.0 million in 2026 and expected to showcase growth with 18.3% CAGR between 2026 and 2035. As a result, Phase Change Materials have become a strategic enabler for high‑performance thermal energy storage and temperature control across energy-intensive sectors, as policymakers and industry stakeholders prioritize stricter building energy efficiency standards, decarbonization of heating and cooling, and low-carbon HVAC solutions. Building & Construction and HVAC together account for 55.8% of global demand, underscoring the central role of these materials in energy-efficient buildings, advanced HVAC systems, and green building materials designed to reduce operational energy use and peak load on electrical grids. Organic PCM Type, which generated approximately $384.55 million in revenue in 2025, dominates the Phase Change Materials industry due to its favorable safety profile, compatibility with building envelopes, and suitability for passive cooling and thermal comfort optimization. This strong end-use concentration and material preference highlight the ongoing relevance of Phase Change Materials as a cost-effective pathway to enhance energy resilience, support ESG-driven investments, and align with tightening sustainability and emission-reduction requirements across developed and emerging markets

Phase Change Materials are engineered substances that absorb, store, and release heat through latent heat storage during precisely controlled phase transitions, offering high energy density, repeatable thermal cycling performance, and the ability to maintain narrow temperature ranges for sensitive environments. Their key features such as tunable melting points, form-stable and microencapsulated configurations, and compatibility with composite building materials enable major applications in building & construction, HVAC systems, cold chain logistics, refrigerated transport, electronics thermal management, and solar thermal energy storage. Recent market trends include growing adoption of bio-based and organic PCM formulations, integration into smart building envelopes and prefabricated wall panels, use in underfloor heating and passive cooling systems, and deployment in temperature-controlled packaging for pharmaceuticals and food. Advancements in encapsulation technologies, PCM-enhanced insulation materials, and hybrid solutions that combine PCMs with renewable energy systems are further accelerating demand, positioning these materials as a critical component of next-generation energy-efficient buildings and sustainable thermal management strategies

Phase Change Materials market outlook with forecast trends, drivers, opportunities, supply chain, and competition 2025-2035
Phase Change Materials Market Outlook

Market Key Insights

  • The Phase Change Materials market is projected to grow from $813.0 million in 2025 to $4.36 billion in 2035. This represents a CAGR of 18.3%, reflecting rising demand across Building & Construction, HVAC, and Textiles.

  • BASF SE, Rubitherm Technologies GmbH, and Croda International Plc are among the leading players in this market, shaping its competitive landscape.

  • U.S. and Germany are the top markets within the Phase Change Materials market and are expected to observe the growth CAGR of 17.6% to 25.6% between 2025 and 2030.

  • Emerging markets including Brazil, India and South Africa are expected to observe highest growth with CAGR ranging between 13.7% to 19.0%.

  • Transition like Sustainability Transition is expected to add $261 million to the Phase Change Materials market growth by 2030.

  • The Phase Change Materials market is set to add $3.6 billion between 2025 and 2035, with manufacturer targeting HVAC & Cold Chain & Packaging Application projected to gain a larger market share.

  • With

    thermal regulation, and

    Green Innovations, Phase Change Materials market to expand 437% between 2025 and 2035.

phase change materials market size with pie charts of major and emerging country share, CAGR, trends for 2025 and 2032
Phase Change Materials - Country Share Analysis

Opportunities in the Phase Change Materials

Explosive growth of liquid-cooled hyperscale data centers in the United States and Canada is also creating demand for smarter thermal buffers that trim peak electricity and backup power costs. Embedding PCMs into rear-door heat exchangers, immersion tanks, or modular batteries helps ride through power spikes and cooling failures. Tunable eutectic PCMs, whose global revenues are set to climb from $82.93 million in 2025 to $172.20 million by 2030 with 15.74% CAGR, should see the fastest adoption in this niche.

Growth Opportunities in North America and Asia Pacific

In North America, Phase Change Materials adoption is most strongly driven by stringent energy-efficiency codes, decarbonization commitments, and the rapid expansion of high-load facilities such as data centers and advanced manufacturing. Building & Construction and HVAC systems represent the most influential End-Uses, with PCMs positioned as high-value solutions for building energy efficiency through integration into building insulation, wallboards, roofing, and retrofit products targeting net-zero buildings. Cold chain logistics and temperature-controlled packaging offer additional top opportunities as pharmaceutical, biotech, and specialty food supply chains seek more reliable latent heat storage and longer hold times with lighter packaging formats. Competition is characterized by technically advanced, certification-focused suppliers partnering with HVAC OEMs, construction system integrators, and packaging converters, with differentiation built around safety standards, cycling durability, and bio-based or low-toxicity chemistries. Strategic investment priorities include premium microencapsulated Phase Change Materials for smart building envelopes, modular thermal energy storage blocks for peak-load management and renewable integration, and high-stability PCM solutions for data centers and electric vehicles where thermal reliability is mission-critical.
In Asia Pacific, Phase Change Materials demand is propelled by rapid urbanization, rising cooling loads, and industrial upgrading, making Building & Construction, HVAC systems, and Electronics the most influential End-Uses across high-growth economies. The top opportunities lie in cost-optimized PCM-enhanced construction materials for mass housing, ceiling and wall systems for passive cooling, and compact latent heat storage units that alleviate grid strain in dense urban clusters. Strong growth in electronics manufacturing, automotive platforms, and battery supply chains opens additional space for PCM-based thermal management around consumer devices, power electronics, and electric vehicles, where lightweight, high-conductivity thermal energy storage is critical for safety and performance. Competitive dynamics are more fragmented than in mature markets, with regional chemical producers, component manufacturers, and system integrators competing primarily on cost while gradually shifting toward performance and reliability as key differentiators. Strategic focus should center on localized PCM production, scalable microencapsulation technologies tailored to cementitious and polymer matrices, and application-specific product lines for HVAC retrofits, cold chain logistics, and electronics cooling that balance affordability with robust service life under diverse climatic conditions.

Market Dynamics and Supply Chain

01

Driver: Increasing Demand for Energy Efficiency in Buildings and Sustainable HVAC Solutions

The demand for phase change materials is also strongly driven by the need for energy-efficient building designs and the adoption of sustainable HVAC systems. In the construction sector, PCMs like microencapsulated paraffin and bio-based PCMs are also integrated into walls, ceilings, and insulation panels to stabilize indoor temperatures, reduce heating and cooling loads, and lower energy consumption. Separately, in HVAC systems, PCMs are also used in thermal storage units, duct linings, and heat exchangers to shift peak loads and store excess heat, improving overall system efficiency. The combination of green building regulations, rising electricity costs, and incentives for energy-efficient retrofits encourages developers and facility managers to adopt PCM-enabled solutions. Leading suppliers like BASF SE, DuPont, Honeywell, and Phase Change Energy Solutions are also innovating with high-performance, durable PCMs that meet thermal comfort requirements while supporting energy-saving and sustainability goals across commercial, industrial, and residential segments.
Another key driver is also the rising integration of phase change materials into smart textiles and performance apparel. Microencapsulated PCMs embedded in fibers and coatings absorb, store, and release body heat, providing thermal regulation in clothing, bedding, and wearable products. This trend is also driven by demand for adaptive comfort, outdoor gear, and energy-saving textile solutions. Companies like Outlast Technologies are also pioneering PCM fabrics, enabling apparel brands to offer garments that maintain wearer comfort in variable environmental conditions, enhancing both consumer appeal and market penetration.
02

Restraint: High Production Costs and Complex Integration Challenges Limit Broad Adoption

A major restraint for phase change materials is the high manufacturing cost and technical complexity associated with producing and integrating advanced PCMs. Synthesizing microencapsulated paraffin or salt hydrate materials, and embedding them into building materials, HVAC systems, or textiles, increases production expenses and installation time. For example, construction firms may avoid PCM‑enhanced panels due to budget constraints, slowing uptake and reducing revenue growth in cost‑sensitive markets such as affordable housing or small‑scale HVAC upgrades.
03

Opportunity: Building envelope retrofits in European commercial real estate using PCMs and Cold-chain logistics for vaccines and biologics in rapidly urbanizing African cities

EU climate policies and the Renovation Wave are accelerating demand for low-disruption thermal retrofits in existing offices, hotels, and retail buildings. Phase Change Materials integrated into gypsum boards, ceiling tiles, and façade systems can deliver passive peak-load shifting without replacing HVAC. Organic PCMs, already growing globally from $384.55 million in 2025 to $714.80 million by 2030 with 13.2% CAGR, are best positioned here due to safety, recyclability, and easy integration with building materials, yet mid-market property portfolios remain under-served.
Rapid urbanization and vaccine deployment across African metros are stressing fragile cold-chain networks, especially in last-mile clinics and informal food markets. Compact PCM-based containers and solar-powered refrigerators can maintain 2–8°C without continuous grid power, reducing spoilage and diesel dependence. Inorganic PCMs, projected to rise globally from $345.52 million in 2025 to $996.72 million by 2030 with 23.6% CAGR, are expected to dominate this opportunity thanks to higher latent heat, durability, and suitability for encapsulated cold packs and transport crates.
04

Challenge: Thermal Stability and Material Compatibility Concerns Affect Long‑Term Performance

Another key challenge is thermal stability and compatibility issues that impact PCM reliability over time. Some organic and inorganic PCMs can leak, degrade, or exhibit phase separation after repeated cycles, especially in harsh environments. These performance concerns discourage adoption in critical applications like building envelopes or industrial HVAC systems, where durability and predictable thermal behavior are essential. This uncertainty can weaken buyer confidence, slow market expansion, and shift demand toward established insulation or thermal storage alternatives.

Supply Chain Landscape

1

PCM Raw Materials

BASF SECroda International Plc
2

Phase Change Materials

BASF SERubitherm Technologies GmbHHoneywell International Inc
3

Thermal Energy Systems

Phase Change Energy Solutions Inc.Rubitherm Technologies GmbH
4

End-Use Applications

Building & ConstructionHVAC & RefrigerationCold Chain Logistics
Phase Change Materials - Supply Chain

Use Cases of Phase Change Materials in Building & Construction & Textiles

Building & Construction : Phase change materials are widely adopted in the building and construction industry to improve indoor thermal comfort and energy efficiency by absorbing and releasing heat at specific temperatures. Organic PCMs such as paraffin‑based microencapsulated materials and bio‑based thermal energy storage products are integrated into wallboards, roof panels, ceiling tiles, and insulation systems to stabilize indoor temperatures and reduce reliance on active heating and cooling systems. Leading players like BASF SE and DuPont provide engineered PCM solutions incorporated into construction materials to support green building initiatives and energy‑saving designs that comply with stricter regulations. Their strong research and supply networks strengthen adoption among commercial and residential developers seeking passive temperature regulation and lower operational costs in sustainable buildings.
HVAC : In HVAC applications, PCMs enhance thermal management in heating, ventilation, and air conditioning systems by storing excess heat during peak conditions and releasing it when needed, reducing energy demand and improving overall system efficiency. Encapsulated PCMs commonly paraffin or salt hydrate formulations are integrated into HVAC components such as heat exchangers, duct linings, and thermal storage units to moderate temperature swings and shift peak loads, aligning with guidelines for energy‑efficient design. This application benefits commercial buildings, industrial facilities, and residential settings where energy reduction and consistent climate control are priorities. Companies like Honeywell International Inc. and Phase Change Energy Solutions develop advanced PCM materials and systems that are compatible with modern HVAC technologies, supporting sustainability initiatives and lower carbon footprints.
Textiles : PCMs are increasingly used in textiles to provide temperature‑regulating properties in performance wear, bedding, and adaptive clothing. Microencapsulated PCMs are embedded within fibers or coatings to absorb body heat and release it when temperatures drop, helping maintain comfort across varying conditions. This temperature management functionality makes them popular in activewear, outdoor apparel, and smart textile solutions where thermal regulation enhances wearer experience. Innovators like Outlast Technologies, known for microencapsulated PCM fabrics, collaborate with fashion and technical textile brands to embed PCM Thermocules in apparel and bedding products for improved thermal comfort and adaptive performance. PCM‑integrated textiles are gaining traction in consumer markets that value comfort, energy efficiency, and advanced material performance.

Recent Developments

Recent developments in phase change materials emphasize smart thermal management and energy‑efficient building solutions. Manufacturers are integrating PCM thermal storage with IoT sensors and HVAC control systems to optimize indoor temperature regulation and reduce energy consumption. A key market trend is the rise of adaptive materials in smart homes and wearable textiles, where temperature‑regulating PCMs enhance comfort and sustainability, driving demand across construction, climate control, and performance fabric sectors.

April  2024 : PLUSS Advanced Technologies introduced Brrf PLUSS, a wearable cooling PCM product that helps reduce body surface temperature by up to 15 °C for workers in hot conditions, reflecting innovation in PCM applications for personal thermal comfort.
March  2025 : Croda International Plc officially opened a new advanced lipids manufacturing facility in Lamar, Pennsylvania, which supports its broader materials portfolio including phase change lipid derivatives used in PCM formulations reflecting capacity expansion and investment in materials science.

Impact of Industry Transitions on the Phase Change Materials Market

As a core segment of the Specialty Materials industry, the Phase Change Materials market develops in line with broader industry shifts. Over recent years, transitions such as Sustainability Transition and Digital Integration have redefined priorities across the Specialty Materials sector, influencing how the Phase Change Materials market evolves in terms of demand, applications and competitive dynamics. These transitions highlight the structural changes shaping long-term growth opportunities.
01

Sustainability Transition

The accelerating sustainability transition in the PCMs market is reshaping competitive dynamics, as manufacturers pivot from conventional chemistries to bio-based and environmentally friendly PCMs that enhance thermal energy storage while reducing lifecycle emissions. Driven by stricter regulatory compliance, green building applications, and demand for energy efficiency and carbon footprint reduction, this shift is not merely reputational but financially material, with sustainability-led innovation expected to add approximately $261 million to PCMs market growth by 2030. Players that rapidly scale sustainable PCM portfolios, secure resilient bio-based feedstock supply, and integrate circular economy principles into advanced materials design are positioned to capture outsized value, strengthen differentiation, and influence long-term standards across high-performance construction, HVAC, and cold-chain PCM market segments.
02

Digital Integration

The phase change materials market is experiencing a notable shift toward digital integration, as PCMs are increasingly combined with smart sensors and IoT-enabled systems to enhance thermal management. In smart homes, PCM-enabled walls, ceilings, and flooring panels work with connected thermostats to store and release heat efficiently, reducing energy consumption while maintaining consistent indoor temperatures. Similarly, in wearable devices and smart textiles, microencapsulated PCMs interact with sensors to regulate body temperature dynamically, improving comfort and performance. This trend is influencing building automation, HVAC, and textile industries, prompting companies like BASF, Outlast Technologies, and Honeywell to develop PCM solutions compatible with smart systems. The integration of PCMs with digital technologies not only improves energy efficiency and user comfort but also drives innovation in adaptive materials, enabling more responsive and sustainable solutions across residential, commercial, and industrial applications.