Photovoltaic (PV) Inverter Market - Forecasts from 2023 to 2028

The photovoltaic (PV) inverter market is predicted to grow at a CAGR of 10.03% from US$4.678 billion in 2021 to US$9.135 billion by 2028.

The photovoltaic (PV) inverter market is anticipated to grow steadily throughout the forecast period. The photovoltaic inverter, a crucial part of the solar energy system, converts the DC electricity generated by the photovoltaic cells into AC power. Photovoltaic inverters convert power and track voltage, allow communication with the grid, and shut down in an emergency. The rising popularity of on-grid solar inverters safeguards the safety and efficiency of home appliances. On-grid solar inverters create a pure sine wave of AC electricity instead of off-grid inverters.

Use cases and technological advancements to boost the market potential.

PV inverters are also frequently used in residential and utility applications. Product innovation and the application of modern technologies in PV inverters are expected to generate attractive growth prospects for the PV inverters market throughout the forecast period. For instance, a pioneer in producing solar inverters, SolaX Power, recently unveiled its newest advancement, the X1-Hybrid LV. The X1-Hybrid LV is a useful addition to SolaX's solar product line and has numerous amazing characteristics that impress clients. It is designed to provide great efficiency for low-voltage PV systems.

Increasing demand for renewable energy

Photovoltaic systems have gained popularity as a suitable option for power generation as individuals and companies are becoming more aware of renewable energy usage. PV inverters transform the DC electricity produced by solar panels into AC power that can be used to power homes and businesses, owing to which such inverters are crucial parts of these systems. Governments worldwide acknowledge the value of renewable energy and encourage its usage through regulations and rewards. For instance, some governments offer tax deductions and subsidies for installing solar power installations. As more people invest in solar energy systems, this will provide a favorable market situation for photovoltaic inverter producers. For instance, as per the report, "Mapping India's Energy Policy 2022: Tracking Government Assistance for Energy," financing for electric cars rose by 160%, from Rs 906 crore to Rs 2,358 crore, while subsidies for renewable energy grew from Rs 5,774 crore in 2021 to Rs 11,529 crore in 2022.

Feature of Photovoltaic inverter systems

Photovoltaic inverter systems are also more accessible and appealing to customers due to government subsidies, environmental advantages, lowering solar panel prices, and improved photovoltaic inverter performance. The need for photovoltaic inverters is consequently increasing quickly. As more individuals and companies adopt photovoltaic systems to satisfy their energy needs, the market is expanding overall due to the rising demand for renewable energy. The government has also increased the expenditure on renewable energy globally, which has augmented the adoption of photovoltaic inverters. For instance, as per the 2022 report by International Energy Agency, the investment increased from US$446 billion in 2021 to US$472 billion in 2022.

Opportunities in the market

Businesses are becoming more aware of the financial and environmental advantages of integrating solar power systems into their operations. The cost savings derived from solar power utilization and the positive environmental impact drive businesses to adopt solar power systems. By embracing this sustainable energy solution, companies can reduce their reliance on traditional energy sources, decrease operational costs, and contribute to environmental conservation.

Moreover, supportive policies such as tax credits and feed-in tariffs incentivize commercial entities to invest in PV inverters for solar power generation. Financial products, such as renewable energy certificates (RECs), facilitate the purchase, sale, or trade of renewable energy without direct involvement in its production or procurement. These RECs, also known as green tags or tradable renewable certificates, enable electric utilities to meet state renewable energy portfolio standards. At the same time, companies utilize them to fulfill voluntary emission reduction goals in their operations.

The need for alternative energy sources is driving market growth.

Increasing electricity costs motivate businesses to explore alternative energy sources, with PV inverters providing a dependable and cost-efficient solution. Companies place importance on eco-friendly practices, including the adoption of solar energy systems, to align with sustainability objectives and bolster their brand image. This strategic emphasis on renewable energy solutions not only helps mitigate environmental impact but also enhances the reputation of businesses, demonstrating their commitment to responsible and sustainable operations. There has also been a consistent increase in solar electricity from March 2022 to March 2023, which 2023 indicates a positive trend in solar power generation within the OECD region. This upward trajectory suggests a growing adoption of solar energy systems, which can directly impact the commercial segment of the PV inverter market.

North America is an Expected Dominant Market

North America is considered one of the most attractive destinations globally due to the region’s access to advanced technology and the presence of major companies. The growing investments in solar plants and off-grid systems are driving market growth in the region.

The USA will dominate the North American market.

The electricity demand has surged due to population growth, making it more vulnerable to failures and outages. The International Energy Agency (IEA) has reported power outages in many countries, including the United States. In these countries, residential energy storage systems can provide a reliable source of electricity for households during outages. The growing installations of residential energy storage systems have propelled the market demand for PV inverters as they are widely employed in residential applications to convert solar energy into usable electricity for homes.

PV inverters play a crucial role in energy storage applications as they ensure efficient charging and discharging of the batteries and facilitate grid services like peak shaving and load shifting. The growing demand for a stable and affordable power supply is anticipated to drive the energy storage market in the country, which in turn is expected to drive the PV inverter market. According to SEIA, in 2021, the United States built 5.4 gigawatts of solar PV capacity, bringing the total installed capacity to 113.5 gigawatts, enough to power 21.8 million American households.

Market Segmentation:

By Connectivity

• Standalone
• On-Grid

By Type

• Micro
• String
• Central

By Application

• Residential
• Commercial
• Industrial

By Geography

• North America
• United States
• Canada
• Mexico
• South America
• Brazil
• Argentina
• Others
• Europe
• United Kingdom
• Germany
• France
• Spain
• Others
• Middle East and Africa
• Saudi Arabia
• UAE
• Israel
• Others
• Asia Pacific
• Japan
• China
• India
• South Korea
• Indonesia
• Taiwan
• Thailand
• Others