PV inverter producers are adapting their manufacturing strategies to navigate changing policy and regulatory conditions in key solar markets, according to analysis from PV Tech Research.
A combination of trade tariffs and legislative measures is driving a significant shift toward localised production in key markets
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The changing landscape for PV inverter manufacturing is explored in a blog post today by our colleagues from PV Tech Research, based on the latest findings from their PV InverterTech Bankability Ratings Report. The post analyses 26 of the leading producers in the utility-scale PV inverter market.
In the US, a combination of tariffs on Chinese-manufactured inverters and Foreign Entity of Concern (FEOC) rules effective January 2026 is creating strong incentives for domestic manufacturing. The Inflation Reduction Act (IRA) offers a 30% Investment Tax Credit (ITC) with an additional 10% domestic content bonus, pushing developers toward non-Chinese supply chains.
While China still dominates global inverter manufacturing capacity among the top 26 producers, the US share is expected to exceed 3% (nearly 40GW) by the end of 2026. European manufacturers including Power Electronics and SMA Solar are establishing American facilities, with Power Electronics planning a 20GW factory.
Europe is similarly pursuing regional manufacturing, targeting 40% domestic production of net-zero technologies by 2030 under the Net-Zero Industry Act (NZIA). Europe’s share of the manufacturing capacity of leading inverter manufacturers is projected to reach 9% (over 100GW) by the end of 2026.
India has emerged as a key growth market, with shipments steadily increasing year-on-year, driven by Production Linked Incentive (PLI) schemes.
However, challenges persist. Average inverter revenues declined in 2024, with shipment growth limited to 10% due to elevated inventory levels and intense price competition from Chinese manufacturers, particularly affecting Western companies like SolarEdge and SMA Solar.
Looking ahead, the blog post by PV Tech Research analyst Mollie McCorkindale concludes that inverter producers will need to continue to adapt in order to survive, with a strategic shift to supplying the burgeoning energy storage market offering a promising path to future growth.
To read the post in full, click here (subscription required). Full details on how to subscribe to our PV InverterTech Bankability Ratings Report can be found here.
