Solar Inverter Market

Rapid development in the renewable energy sector boost market growth

Solar inverter installation is simple, and rapid developments in renewable energy are the main drivers of market expansion during the projection period. However, the main problems limiting the market's growth in the next years include high heat loss in large-sized solar inverters, increased cost, and a lack of panel level monitoring. On the other hand, it is projected that increased government efforts and investment in the electrification of remote and rural areas would present chances for major players in the solar inverter market.

The surge in solar PV installations for multiple applications around the world is being attributed to rapid advancements in the renewable energy sector in terms of power production and usage. According to Market Outlook for Solar Power/2022-2026 research, which was released by SolarPower Europe, the world's solar fleet's capacity doubled in just three years from 2018 to reach one Terawatt in April 2022.

Additionally, to promote the adoption of inverters in industrial applications, several initiatives and efforts are launched by the governments of various nations. For instance, as part of the 14th Five-year Plan, China's national energy administration (NEA) established a target in 2020 for renewable energy to account for more than 50% of all installed capacity by 2025. (2021–2025). In 2020, China has the largest PV market in the world.

Solar energy and energy storage are attractive options for commercial end users because to the Self-generation Incentive Program (SGIP - California only) and US tax benefits. Incentives offered by various governments of different nations to encourage residential and commercial PV installations have fueled the market for distributed PV in Europe. Therefore, rising adoption of solar inverters in various industries applications has enhanced the solar inverter market CAGR across the globe in the recent years.

An essential component of the entire solar system are solar PV inverters. The effectiveness of the entire solar system is thus determined by these inverters, which convert DC electricity to alternating current. Different factors impacting the output of solar systems are taken into consideration by the various types of solar PV inverters that are available. A few of the important parameters that affect the needed output are shade, roof orientation, roof inclination, summer versus winter production, tilting panels, and many others are another factor driving the growth of the solar inverter market revenue.

The increasing global emphasis on renewable energy sources drives the Global Solar Inverter Market Industry. Governments worldwide are implementing policies to reduce carbon emissions and promote sustainable energy solutions. For instance, many countries are setting ambitious targets for solar energy adoption, which directly influences the demand for solar inverters. In 2024, the market is projected to reach 14.7 USD Billion, reflecting the rising investments in solar technology. This trend is expected to continue, as the global shift towards cleaner energy sources becomes more pronounced, potentially leading to a market value of 25.0 USD Billion by 2035.

By Region, the study provides the market insights into North America, Europe, Asia-Pacific and Rest of the World. Asia-Pacific Solar Inverter market is anticipated to account for the largest market revenue share of 40%-45% during the forecast period. The solar market in this region is growing rapidly, and China is both a key competitor as well as its largest provider. The expansion of the industry in the region has also been significantly aided by the rising number of solar installation in developing countries.

Further, the major countries studied in the market report are: The U.S, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 3: Solar Inverter Market Share By Region 2021 (%)

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Europe solar inverter market is anticipated to witness significant growth CAGR over the projected period attributed to the existence of favorable government policies and the availability of subsidies like residential feed-in tariffs (FITs) which encourages consumers to invest in renewable energy. Further, the Germany solar inverter market held the largest market share, and the UK solar inverter market was the fastest growing market in the European region

In 2021, North America solar inverter market held a significant revenue share, with the U.S. being the main driver of market expansion. A significant market for various types of solar inverters is the United States. In addition, string inverters saw strong growth in North America, central PV inverters are anticipated to continue holding the biggest market share during the projected period. Moreover, United States solar inverter market held the largest market share, and the Canada solar inverter market was the fastest growing market in the North American region.

Major market players are spending a lot of money on R&D to increase their product lines, which will help the solar inverter market grow even more. Market participants are also taking a range of strategic initiatives to grow their worldwide footprint, with key market developments such as new product launches, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations. Competitors in the solar inverter industry must offer cost-effective products to expand and survive in an increasingly competitive and rising market environment.

One of the primary business strategies adopted by manufacturers in the solar inverter industry to benefit customers and expand the market sector is to manufacture locally to reduce operating costs. In recent years, solar inverter industry has provided solar inverter with some of the most significant benefits. The solar inverter market major player such as SMA Solar Technology AG (Germany), Canadian Solar Inc. (Canada), ABB Ltd (Switzerland) and others are working to expand the market demand by investing in research and development activities.

SMA Solar Technology AG is a German manufacturer of solar energy equipment with its headquarters in Niestetal, Northern Hesse. Solar inverters for photovoltaic systems with grid connection, off-grid power delivery, and backup operations are produced and manufactured by SMA. The company provide wide range of products such as PV Inverter Market, Hybrid Inverter, Battery Inverter, DC technology, System Solution & Packages and more. In April 2022, SMA Solar Technology AG has launched a new three-phase inverter series for uses in commercial and residential Solar pv systems with outputs up to 135 kW.

Four new models with rated power of 12kW, 15kW, 20kW, and 25kW are part of the line. Six string inputs and three separate MPP trackers are also included. The inverters allow for up to 150% over-dimensioning of PV systems and offer energy power control of complete systems.

Also, A publicly traded firm called Canadian Solar Inc. manufactures solar PV modules and manages major solar projects. The company established in 2001 and it headquarters is in Guelph, Canada. The company provides wide range of products and solution such as Inverters, Modules, System kits, Energy Storage for commercial, residential, and utility. In September 2022, Canadian Solar Inc., a solar developer and manufacturer, launched a new battery storage solution for utility-scale applications called the SolBank and intends to increase its battery manufacturing capacity from the current 2.5 GWh to 10 GWh by the end of 2023.

A lithium iron phosphate chemistry-based battery with a capacity of up to 2,800 kWh is produced by CSI Energy Storage, a majority-owned subsidiary of Canadian Solar called CSI Solar Co Ltd. It is now made in China's Jiangsu Province at the workshops of CSI Energy Storage, which have a 2.5 GWh annual production capacity.