Inverter shipments continue to grow as demand shifts to Asia

Cormac Gilligan, IHS



Cormac Gillian, IHS

Inverter shipments are forecast to increase by 5 percent to reach almost 42GW in 2014 with Asia accounting for 58 percent of global shipments. Two of the three largest PV inverter markets in the world, Japan and China, are in Asia; and these two markets are having a huge impact on the global inverter market.

Global inverter revenues are forecast to decrease to $6.8 million in 2014 under intense price pressure globally with prices forecast to fall by 6 percent on average to reach $0.16/W in 2014. This is according to a new report entitled “PV Inverter Market Tracker - Q3 2014” from IHS (NYSE: IHS), a leading global source of critical information and insight.

Much of this growth will be driven by the increasing momentum of the distributed PV business. China’s push toward distributed PV has been to slow to get started, and IHS believes that actual installations fell significantly short of the 8 GW target that was set for 2013. Nonetheless, this increasingly important segment will be a key driver for growth.

Asian suppliers dominate supplier rankings

In Q2’14, four of the top-ten inverter suppliers by revenue were from Asia; Japanese inverter suppliers such as Omron, Tabuchi and TMEIC dominated the ranking. This is due to Japan having the highest inverter prices in the world as the market is dominated by local suppliers, with only a few western suppliers active in the Japanese market because of JET certification requirements.

Huawei was the only Chinese supplier to enter into the top 10 inverter suppliers in the second quarter. Its entry was due to a surge in shipments in China. Even though other Chinese inverter suppliers are shipping large quantities of inverters, low average inverter prices in China under intense competition limit their revenues as thus the number of Chinese suppliers in the top ranks.

Domestic suppliers also faced problems of their own. Although China represents a huge opportunity for its own suppliers in terms of volume, low pricing caused by fiercely competitive local companies, highly complex business conditions and lengthy credit terms have either prevented them from succeeding in gaining a sizable share of the market, or forced them to concentrate on other regions.

Three-phase string inverter shipments to increase dramatically in 2014

Revenues of three-phase low-power (<=35kW) and medium-power (36-250kW) inverters are forecast to account for a third of global inverter revenues and reach over $2 billion in 2014. Growth is being driven by attractively low average prices in key PV markets, which will allow them to increase their penetration of commercial and utility-scale installations.

Three-phase low-power and medium-power inverter shipments are projected to increase 35% year-on-year to reach over 12GW; a surge of shipments forecast in key markets such as China and Japan will account for 6.3GW alone.

However, IHS forecasts that inverter revenues will recover in 2015 to reach $7.1 billion, as inverter shipments increase over 48GW.