In this paper, an on-line estimation algorithm of the source term in a first order hyperbolic PDE is proposed. This equation describes heat transport dynamics in concentrated solar collectors where the source term represents the received energy. This energy depends on the solar irradiance intensity and the collector characteristics affected by the environmental changes. Control strategies are usually used to enhance the efficiency of heat production; however, these strategies often depend on the source term which is highly affected by the external working conditions. Hence, efficient source estimation methods are required. The proposed algorithm is based on modulating functions method where a moving horizon strategy is introduced. Numerical results are provided to illustrate the performance of the proposed estimator in open and closed loops.