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Global PV market to drop 5% to $6.7 B in 2013

Posted: 01 Aug 2013 ?? ?Print Version ?Bookmark and Share

Keywords:PV inverter shipment? solar photovoltaics?

According to the latest report from IHS, the global market for solar photovoltaic (PV) inverters is seen to decline by five per cent to $6.7 billion in 2013. Despite PV inverter shipments rising to 34.2GW in 2013, average global inverter prices will fall by 11 per cent this year, resulting in a decline in revenue, posing significant challenges to inverter suppliers as they cope with shrinking profit margins and increased competition.

The fierce price pressure that inverter suppliers are now facing is being driven by a number of factors. Notwithstanding some of the recent major acquisitions in the inverter market, the inverter supplier base continued to fragment in 2012 as existing and new inverter suppliers expanded their presence in PV markets. The Top 10 inverter suppliers accounted for only 57 per cent of global revenues in 2012, compared to 66 per cent in 2010.

Price declines are expected across all power classes in EMEA in 2013, with three-phase string inverters projected to decrease by as much as 15 to 20 per cent. The global fall in average pricing is also being compounded by a regional shift in inverter demand from Europe to more competitively priced markets such as China. Average inverter prices are already at very low levels in China, which will be the largest market for inverter shipments in 2013. Prices are forecast to drop further to $0.09 per watt, as the market is dominated by low-price central inverters.

A strong increase in the demand for high-power inverters, which typically have a lower price per watt, will also drive down global pricing and will not be unique to China. A number of the largest markets will continue to be focused on utility-scale installations, and will see shipments of large inverters grow as a result.

In spite of the global pricing pressure for inverters, numerous opportunities are available for inverter suppliers in particular market segments, as shown in the attached figure. IHS forecasts that the three-phase 250kW and higher-inverter market in Japan will grow from $50 million in 2012 to $290 million in 2013 as utility-scale projects are installed.

This segment of the Japanese market is dominated by domestic suppliers currently, but the surge in demand for central inverters will present opportunities for Western suppliers that establish quickly on their own. Still this will be a short-term trend as the market will decrease in 2014 and 2015 after completion of the initial project pipeline and when there is less suitable land available.

Also, the three-phase string market in the U.S. will double to reach slightly more than $100 million in 2013, as inverter suppliers expand their portfolios and offer a decentralized solution to their customers looking for an alternative solution to a central inverter in commercial systems.

As inverter pricing pressure is forecast to continue in 2013, suppliers are being more innovative in how they can create savings and value for their customers. Numerous suppliers are releasing new inverters with advanced features or new designs. For their part, inverter manufacturers are releasing new outdoor-rated and turn-key products, which will assist customers in reducing labour and installation costs along with expenses related to operations and lifetime maintenance.

Inverters are continually being released that are rated at 1,000VDC or greater in order to allow longer strings and reduce DC cabling.

While 2013 is forecast to be another challenging year for inverter suppliers as prices fall further, opportunities will exist for inverter suppliers in key PV market segments, such as the U.S., Japan and China. Also by 2014, inverter revenues are predicted to rebound strongly and increase by 11 per cent to reach $7.3 billion, which should give some welcome relief to inverter suppliers.





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