The global PV inverter market is expected to reach $8.5 billion, a compound annual growth of nearly 25 percent.
It is also forecast in a report by IMS Research that more than 7 million inverters will be sold in 2014, marking an impressive increase from less than one million sold in 2009.
The report found that despite a factory-gate price decline in the region of 11 percent last year, the actual revenues generated from inverters doubled to more than $5 billion for the first time.
It's predicted that this growth is set to continue, with the market expected to double again in the next five years despite price reductions and architecture changes.
It is also noted that while the market for PV inverters is obviously closely tied to the market for PV installations, the two became separated last year due to shortages, component bottlenecks and double ordering.
This meant that there was a large imbalance in supply and demand after a bottlenecking of components was exacerbated by the booming market in Germany and further compounded by double ordering as a result of panic over lack of supply.
The shortage affected certain supply firms differently with some, such as SMA, losing share -while Power-One captured major share according to IMS Research.
However it is thought that the shortage is over, with a shift now towards oversupply of inverters recorded in the fourth quarter of 2010.
“Despite the shortage of inverters at the beginning of 2010, IMS Research estimates that more than 2 GW of inverters were produced that were not needed,” said Ash Sharma at IMS Research.
“This has led to high inventory levels, both at suppliers’ warehouses, and throughout the supply chain. This came as a direct result of double-orders being fulfilled and has also led to cancellations and push-backs of orders.”
Due to the shortage many inverter suppliers announced capacity expansion, leading to the industry capacity total amounting to 30GW in 2010. Despite this significant expansion – double that of the preceding year – factory utilisation also increased significantly to around 70 percent, even reaching 90 percent in the third quarter of 2010.
It is even expected by Sharma that capacity expansion will continue in 2011, particularly in Asia and North America. Sharma reckons this will amount to another 12-15GW of additional capacity, though IMS notes the surprising nature of this with a supposedly uncertain market outlook in 2012.