Although the global solar capacity has been surging, the price downtrend caused by the overexpansion has lathered a real blow to the solar industry. Due to the price downturn and the uncertain demand outlook, the downstream solar players are facing a severe challenge. However, some companies, like iEnergy, succeed in obtaining market shares with innovative technologies. EnergyTrend conducted an exclusive interview with iEnergy, focusing on the breakthroughs Microinverters are able to bring to the solar industry.
Given the weak demand at present, the solar industry is now facing cutthroat competition. The companies compete with one another in not only how long they can hold out, but also the amount of high conversion efficiency products they manufacture. Yet, the solar module is not the only factor that affects solar system’s conversion efficiency. In a nod to the market’s increasing demand for high conversion efficiency, for those companies seeking the highest possible conversion efficiency of solar modules, inverters become the go-to solution. Therefore, one of the biggest challenges the solar systems are currently facing is how to increase the efficiency of solar systems through inverters.
Microinverter to Solve the Shadow Problem of Traditional Inverter and Simplify the System Design
The founder and CEO of iEnergy Steven Huang indicated that microinverters have several advantages which make them superior to traditional inverters: they can solve the shadow problem and largely simplify the solar system’s circuit design. Moreover, they require low current and low voltage, which sustains a stable work environment. In addition, they can keep track of the highest power output and incorporate with respective solar modules, increasing the power output by 5-25%. Furthermore, microinverters are closely related to the development of solar rooftops market. Looking at the trend of rooftop market, when the solar system prices reach the grid parity, it is time for the rooftop market to soar. Huang believed that solar rooftops will become the mainstream product of the solar industry, and microinverters are the best solution in the market.
In addition, iEnergy pointed out that the lifespan and reliability of microinverters are longer and better than those of traditional inverters. Traditional inverters operate under a high-voltage (3-5 kW) and high-temperature environment, while microinverters average an efficiency of 200~260W per module, which results in a work environment with much lower voltage and temperature. Due to that electronic products’ reliability is greatly affected by environment temperature, voltage, humidity and that microinverters adopt different electronic components and circuit designs, microinverters’ lifespan can go up to 20-25 years, which is compatible with the warranty of the modules in the market. On the other hand, the traditional inverters’ warranty is five years at most, and the prolonged warranty requires an extra fee, which may be equal to the cost of the inverter. Even if the user chooses not to extend the warranty, the maintenance cost afterward will become a burden as well. Considering the aforementioned factors, microinverters’ prospects are looking up.
Installed Capacity of Microinverters Expected to Reach 8GW by 2014
Huang believed that microinverters are one of the most promising products in the next 3-5 years. Despite its small market size at present, microinverters show strong promise toward an installed capacity of 8GW by 2014 at the soonest. From a short-term perspective, the North America will be the biggest market for microinverter. Looking at the mid-term development, the European market is expected to soar in 2H12, because the European countries’ demands start to emerge, especially Belgium, Britain, France and Italy. As for Germany, due to the fact that the solar system companies there have used traditional inverters for more than a decade, it is inevitable that German solar makers would think traditional inverters as the best solution without knowing microinveters. It will require time for microinverters to reach wide adoption in Germany (approximately one or two quarters later than other European countries). On account of that the solar roof sector accounts for 50-60% of Germany’s solar market value and that Germany is expected to reach grid parity in 3Q12, the penetration rate of microinverters is expected surge considerably in 2013. In regards to the Asian markets, Huang is very optimistic about the prospects of the Japanese market in 2012 and estimated the market value at 2-2.5GW. In addition, Huang predicted that China will replace Europe as the largest solar market in the world within the next 3 to 5 years. However, due to the low demand for solar roofs in China at present, the Chinese solar market will still be mainly underpinned by the large-scale projects. Chinese households’ solar demand will not pick up for the next five years. Currently, iEnergy has launched standard model products, and will develop other models catering to different markets in the future.
The Future Solar Market Prospects Looking Up
Huang believed that 2011 is the second turning point for the global solar industry since the breakout of the Financial Tsunami. Over the past five years, the subsidy policies of countries around the world not only contributed to the rapid growth of the solar industry, but also made it too easy for companies to enter the industry. 2012 marks the new chapter of the solar industry, and companies need to strive to strengthen market position and seek for diversity. Once the solar energy become more popular, related applications and technologies will come to light. There are two development paths for the solar players: one is pursuing more clients in order to maintain market shares, but the gross profit margin will most likely be low; another is focusing on developing innovative technologies.
Moreover, Huang pointed out that regardless of how brilliant the technologies are, the importance of cost per watt still outweighs all. The traditional inverter accounts for 10-15% of the system’s total cost. Due to microinverters’ AC output, they do not require as many wire stocks and BOS components as the traditional inverters do. Therefore, based on a further cost analysis, with the price remaining the same, adopting microinverters can reduce the cost by 10-20% compared to adopting inverters. In addition, iEnergy provides a 20-year warranty for their microinverters. If the traditional inverters’ warranty is extended to 20 years, the cost per watt will increase to roughly US$ 0.8. As for the time the installation requires, the traditional inverters need 40 hours, while microinverters only need 20 hours. The time saving will make even more evident differences in North America and Europe in terms of cost reduction.
On the other hand, Huang also indicated that the traditional inverters have come into existence for 20 years. Hence, the price will most likely stay the same. As for microinverters, with expertise in semiconductor, solar energy and IC industry, the company’s R&D team is endeavoring to simplify products’ circuit design in order to further reduce cost. Although the microinverters’ manufacturing cost is higher at present, Huang was confident that microinverters will become cheaper than inverters when the production reaches economy of scale in the next two years. Huang also stated that the microinverter is a epoch-making product, and he hoped iEnergy can become the Apple in the solar industry and trigger a revolution. According to him, iEnergy has received at least 300 thousand microinverter orders for 2012.
