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New breeds of PV inverter pose threat to established players

Micro-inverters and power optimisers are rapidly stealing market share from traditional PV inverters in fast-growing residential markets like the US, representing a serious threat to established players like SMA Solar, according to IMS Research.

Regular inverters, such as those produced by SMA and Power-One, typically tie-in all the panels of a PV system, converting the electricity they produce into a form useable by the grid.

The chief downside of such inverters is that they work with the system as a whole, as opposed to individual panels. As a result, if a single panel becomes partially shaded or damaged, the entire system’s output can be lowered significantly.

In contrast, micro-inverters connect to each individual panel – maximising the system’s overall output, but also increasing the upfront cost. Power optimisers are something of a hybrid between the two.

Micro-inverters and power optimisers are by far the fastest growing segment of the PV industry, albeit from a relatively small base.

After growing 180% last year, shipments are on track to increase another 70% this year – hitting 900MW. IMS has forecast a roughly 30GW global PV market for 2012.

While micro-inverters are likely to be largely contained to the residential market, power optimisers can also be used for utility-scale projects in emerging markets.

Leading suppliers of the two “disruptive” technologies include Enphase Energy, SolarEdge and Tigo.

While the systems have been slower to catch on in mature European markets, they are spreading like wildfire in affluent countries with fast-growing residential PV markets, such as the US, Canada, the UK, Japan and Australia.

IMS reckons they will carve out a 25% market share in those five countries by 2016, compared to a 10% global market share.

The steady shift away from traditional inverters represents another ominous portent for the PV manufacturing sector in Europe, where many older inverter makers are based.

Eight of the 10 leading inverter suppliers last year were European, led by the dominant player SMA Solar.

A number of traditional inverter players – including SMA and Power-One – intend to release their own micro-inverter products over the next year.