IMS Research has published a new report, “The World Market for PV Inverters”, which projects that ‘smart’ PV inverter shipments in 2015 will reach 27GW, comprising 60% of the market, compared to 20% in 2010. The report predicts that the long-term outlook for the PV inverter industry has an encouraging future with smart invertors making up the majority of the market by 2014 and Europe providing the most demand.
Several factors have led IMS to conclude that the market demand in 2015 will reach 27GW including utility concerns over grid imbalances, the expanding proportion of PV connected to the grid and the need for energy storage to utilize self-consumption tariffs in order to better integrate PV into the ‘smart grid’. As reactive power, smart grid interaction and energy storage pave the way for inverters to become a fundamental part of the grid infrastructure, the PV inverter market is expected to feel the demand increase over the next five years.
Tom Haddon a PV research analyst at IMS Research explained, “Utilities, especially in Europe, are increasingly pushing for inverters to assist in grid stabilization and conform to stricter technical requirements.” This thinking has led IMS research to hypothesize that smart inverters will represent 80% of the EMEA market in 2015. Haddon continued, “Despite this, most inverter shipments will still not be ‘fully smart’ and will only have reactive power capabilities, rather than full smart grid interaction or energy storage.”
Not too surprisingly, IMS points out that Germany is spearheading the assimilation of PV into the grid with new low- and medium-voltage directives, while fellow European countries are likely to follow Germany’s example. As directives are fully enforced, IMS Research foresees standard inverters falling to only 42% of the global shipments by 2015.
“Reactive power is an essential feature for inverters to carry if PV is to be a substantial part of the energy mix to provide local grid control which is why the German authorities have acted first to implement such codes,” Haddon added.
IMS additionally noted that inverters are increasingly becoming combined with energy storage, leading the researchers to believe that over the next four years, nearly 5% of all PV inverters shipped will have a form of energy storage, such as batteries, to help power loads throughout the day. IMS Research points out however, that this scenario will only be realized if cost is reduced, and quickly at that, while efficiency and reliability are improved so that customers more readily accept the new trend.
“Demand for PV inverters with energy storage will most likely be driven by incentives favoring ‘self-consumption’; however, current solutions, relying on lithium ion batteries, are currently too expensive and need to be reduced considerably before they will be deployed more widely,” Haddon concluded.