IHS: U.S. market boosts inverter sales for SMA, SolarEdge

Last week the world’s largest inverter maker, SMA, reported provisional results for 2015 which showed a 24% increase in revenues and a return to profitability after two years of losses. And yesterday, Israel’s SolarEdge reported record quarterly revenue of US$125 million, at a 15% operating margin and a healthy net income.

And while both have global diversification in their sales and are dominant in very different market segments, IHS says that the United States is the “key market” for both companies – both in terms of present success and future prospects. IHS estimates that the U.S. will represent 30% of global PV inverter revenues in 2016.

Along with being the global leader in the inverter market, SMA is also the leading supplier of utility-scale inverters in the United States. This positioned was strengthened by the opening created when rival Advanced Energy left the inverter business last year, and SMA has already announced new products for the U.S. market in 2016.

IHS describes SolarEdge as “one of the leading suppliers” in the residential and small-commercial solar markets. The company’s strength comes from not only supplying inverters but also its leadership in the power optimizer market.

SolarEdge has long been in fierce competition with microinverter market leader Enphase, and according to GTM Research beat Enphase to become the leading supplier to the U.S. residential market over the first three quarters of 2015. The rivalry between the two companies extends to technology, as Enphase’s microinverters supply similar module-level power optimization as SolarEdge’s solutions.

In addition to Enphase, Fronius, ABB and SMA also have products for the residential market, and represent competitors to SolarEdge. However, SolarEdge continues to show technology leadership. The company recently began shipping its HD-Wave inverters, which feature a fundamentally new design offering smaller and lighter physical components and higher efficiency.

In both utility-scale and distributed segments, IHS says that competition is intensifying in the U.S. market, as both European and Asian inverter makers attempt to gain market share. IHS says that Chinese inverter makers could represent a significant challenge in the residential space.

“There is also an increasingly likely possibility that highly price-competitive Chinese suppliers will establish themselves as approved vendors to leading solar lease installers,” warned IHS in a press statement.

Due to this competition, the organization expects average inverter prices to fall 9% annually through 2019 in the United States.