SunPower buys SolarBridge Technologies

SunPower Corp. has acquired leading integrated microinverter technologies group SolarBridge Technologies in a move that expands its product portfolio for residential customers.

SunPower said it would use the technology, which converts direct current (DC) generated by a single solar photovoltaic panel into alternating current (AC), to develop next generation microinverters for use with SunPower’s high-efficiency solar panels.

Based in Austin, Texas, SolarBridge has developed a microinverter solution for roof-ready AC solar panels that SunPower describes as "innovative and highly reliable."

"Panels with these factory-integrated microinverters can be directly installed, eliminating the need to mount or assemble additional components on the roof or the side of a home," the company added.

SunPower President and CEO Tom Werner said the acquisition of SolarBridge and its microinverter technology would allow the company "to develop a differentiated product specifically optimized for our high efficiency solar panels. This is the beginning of integrating electronics into our world-class solar panel technology. In this case, the combined result will provide our residential customers with an elegant, reliable and complete solution that fits their home specifications, including system design flexibility, ease of installation and maintenance and improved overall aesthetics."

With AC solar panels, the power generated by the solar system is optimized and monitored at each solar panel to ensure maximum energy production. They provide design and installation flexibility and are suited for a wide variety of system and rooftop configurations, according to SunPower. The company also pointed out that AC solar panels "help reduce soft costs associated with residential photovoltaic solar installations, including labor, permitting and customer acquisition costs, which represent a significant portion of the overall system cost."

SunPower declined to provide financial details of the acquisition.

Analysis of the deal

Commenting on the deal, Sam Wilkinson, research manager for PV Inverters & Energy Storage at IHS Technology, said Sunpower has positioned itself "as a provider of premium PV modules to the residential market in the U.S.A. Therefore an AC-PV module fits well into its product portfolio. An ‘AC-PV module’ is a module with a microinverter embedded into the module’s junction box before it is shipped, with no DC connections."

Wilkenson added that micronverters have rapidly emerged in the U.S. residential PV market and were expected to account for more than 40% of inverters shipped to this segment in 2014.

"The challenge for SunPower in benefiting from this trend is that the high power of its modules means that most standard microinverters are not suitable for it," Wilkenson said. "Acquiring microinverter technology will enable it to optimize a product for use with its modules and streamline the process of integrating it. The inverter can be adjusted and optimized for its high efficiency modules and it will take control over the complete process."

IHS estimates that SolarBridge was the third largest microinverter supplier in the United States in terms of revenue last year. The company began expanding into international markets in 2013, with some success in Australia.

Wilkenson said SolarBridge had "aggressively promoted the AC module approach. The main benefits of this approach (compared to a standalone microinverter) is that on-site installation time is greatly reduced as the microinverter and module are installed as one piece. IHS forecasts that AC modules will be the fastest growing microinverter type, growing over 100% per year to reach over 800 MW in global shipments in 2018, as they significantly reduce ‘soft costs’ such as labor, which currently makes up a significant proportion of total system costs in the United States. With the SolarBridge inverter now very likely to be optimized to be paired just with SunPower’s technology, embedding the microinverter at the factory to create an AC module is likely to be its preferred form for the product."

The backing of a PV giant such as SunPower, which is 66% owned by French oil and gas corporation Total, could accelerate the adoption of microinverters, according to Wilkenson. "It may also help to ignite further competition in a market which is currently dominated by one supplier, helping to drive innovation and cost reduction."

Germany’s SMA Solar Technology currently supplies inverters to SunPower for use in its residential PV kits but Wilkenson pointed out that SunPower’s acquisition of SolarBridge and its microinverter technology could result in reduced demand for SMA’s products in the coming years.

The trend towards greater vertical integration in the U.S. residential market between large residential installers and balance of system suppliers is increasing, Wilkenson added. He pointed to recent deals, such as Solarcity’s acquisition of Zep Solar, that have largely focused on the reduction of installation costs.

IHS predicts that this trend will continue in 2015 as suppliers look to develop and optimize complete system offerings and streamlining their route to market.