Mar 06, 2021
The update tide of photovoltaic inverters is approaching
The life of a photovoltaic inverter is generally about 10-15 years, which is shorter than the life of a photovoltaic module of 20-25 years. A number of market research institutions recently released reports claiming that the update wave of photovoltaic inverters will come earlier than the update wave of modules. Founder Securities estimates that the global photovoltaic inverter replacement scale in 2020 is about 7 GW, and it is expected to rapidly increase to about 37 GW by 2025. At the same time, with the continuous increase in the scale of new installed capacity in the global photovoltaic year, the photovoltaic inverter industry will usher in a new round of development opportunities.
Pending outbreak: replacement demand is small at this stage
According to a report by Founder Securities, based on the average value of new demand from 10 to 15 years ago, from 2021 to 2025, global photovoltaic inverter replacement demand will reach 13.2 GW, 18.4 GW, 24.7 GW, 30.8 GW and 30.8 GW respectively. 37.3 GW, the market demand is steadily expanding.
Guosen Securities has calculated the replacement cycle for 10 years. It is estimated that the annual replacement demand for photovoltaic inverters in the next 5 years will remain at about 30 GW, and the annual replacement demand output value will be close to 1 billion yuan.
Will the fast-growing photovoltaic inverter replacement market have an impact on the industry?
EnergyTrend, an analyst at TrendForce's new energy research center, TrendForce, told reporters that since the early installations of global photovoltaic development were concentrated in Europe, the current demand for replacement of traditional inverters is also dominated by the European market. At present, the demand for photovoltaic inverter replacement market is relatively small compared to the entire inverter market.
“As the pre-installed projects have entered a new round of inverter replacement period, the global inverter replacement demand will enter a stage of rapid growth, and the inverter replacement demand in China, Japan and other Asian and American markets will accelerate.” The above-mentioned analyst Say.
Prepare early: speed up enterprise expansion
Although the photovoltaic inverter replacement market has not yet entered the explosive development stage, if the global new demand for photovoltaic inverters is superimposed, the total demand in the next five years is still very considerable. According to Founder Securities' calculations, from 2021 to 2025, the global new demand for photovoltaic inverters will be 161 GW, 186 GW, 211 GW, 235 GW and 266 GW, respectively.
EnergyTrend said that as the domestic photovoltaic supply chain enters the expansion cycle, some domestic inverter companies have made preparations for the inverter replacement market in advance, including head inverters such as Sungrow Power Supply, Shangneng Electric, Jinlang Technology, and Goodway. All inverter companies are ready to expand their inverter production lines.
At the beginning of February, Sungrow released a fixed increase plan. The total amount of funds raised by the public offering of shares will not exceed 4.156 billion yuan, which will be used for projects such as an annual production of 100 GW of new energy power generation equipment manufacturing bases, including the addition of 70 GW of photovoltaic inverter equipment , 15 GW wind power converter, 15 GW energy storage converter production capacity.
Sungrow believes that as the scope of inverter applications continues to expand, the company's existing capacity shortage may further intensify. The implementation of this fundraising project will effectively alleviate the situation and meet the rapidly growing market demand.
Potential can be expected: market share will increase
In recent years, domestic companies have continuously increased their efforts to develop the overseas photovoltaic inverter market. In the context of the replacement of photovoltaic inverters and the continuous increase in new demand, it will bring a new round of opportunities for domestic enterprises and promote the further increase of domestic enterprises' global market share.
EnergyTrend pointed out that, affected by factors such as the macroeconomic environment, overseas policies, and corporate layout, the market share of Chinese companies has slowed down from the previous period. Compared with other links in the photovoltaic supply chain such as silicon materials and silicon wafers, the current market concentration of photovoltaic inverters is relatively low. As of the end of 2020, domestic companies accounted for more than 60% of the global market.
Overall, the domestic photovoltaic inverter technology level is rapidly improving, coupled with the lower cost advantage, the future share of domestic enterprises in the global photovoltaic inverter market will continue to grow steadily. "After ABB, Schneider and other established European and American inverter companies withdrew from the photovoltaic inverter business one after another, some European and American inverter manufacturers still have a certain market share relying on corporate brand channels and regional protection policies. With the construction of market channels, the potential of inverter companies to explore overseas markets in the future is still promising.” The analyst said.
EnergyTrend also reminded that at present, domestic inverter companies still have the problem of relying on imports for core components such as IGBTs, and the localization of core components still needs to be continuously promoted.