Global Energy Storage Battery Inverter Market Size 2018, By Type (Single-Phase Electric Power, Three-Phase Low Power (10 kW to 35 kW), Three-Phase Medium Power (36 kW to 250 kW) and Three-Phase High Power (251 kW+)), By Application (Residential, Commercial and Utility-Scale) and By Region (North America, Europe, Asia Pacific, Latin America and MEA), and Forecast 2019 – 2025

Developing countries suffer from acute power shortage and peak demand issues. According to the India Brand Equity Foundation (IBEF), India generated 1,160.1 billion units of electricity in 2017 compared to 771.60 billion units in 2010. The country stood third globally in terms of electricity production in 2017. Despite being a major electricity producer, the country suffers from acute peak demand deficit, especially in summer. The below graph shows the peak deficit in the country in 2017 in different regions.

Huge losses during transmission and distribution is one of the key factors contributing to the peak demand deficit. This is one of the major factor driving the growth for battery storage inverters. The widening gap between the demand and supply of electricity has created a need for inverters. Decreasing tolerance for long power cuts among consumers is another major factor contributing to the growth of the battery storage inverter market.

Lighting, fans and other electrical appliances need continuous power back-up support at times of power outage which creates the need for inverters. The rise in disposable incomes has resulted in the sales of electrical appliances such as televisions, air conditioners, and refrigerators. Owing to the inadequate power supply, consumers shift towards the use of inverters. With a substantial increase in electricity bills, power shortage, and ‘go-green’ trend, the inverter market is gaining traction at residential sectors in developing countries like India.

The demand for battery storage systems has seen strong growth in developing economies such as India owing to power outages and support from the government through the national solar mission. This has prompted the state governments and national bodies to increase the installation of solar inverters for reliable backup. The Indian government’s target of achieving 100 GW of installed solar capacity by the year 2022 and the government’s Make in India initiative has driven the overall market. A number of manufacturers such as ABB and Schneider Electric have established the manufacturing facilities in India. For instance, in September 2016, ABB opened the second manufacturing facility in Bengaluru which helped to double its production capacity. The low prices of solar energy have led the governments to take appropriate steps to accelerate the adoption of solar energy in the Middle East & Africa region. In October 2017, Saudi Arabia’s Public Investment Fund (PIF) signed a Memorandum of Understanding (MoU) with the private equity fund SoftBank Vision Fund for the development of 3 GW solar PV and energy storage projects. The UAE is continuing to take the necessary steps to develop large-scale renewable energy projects, in line with its 2050 energy plan. These government initiatives will substantially increase the demand for solar inverters in the region.

Single-phase electric power distribution system is used in cases of lighting and heating where the voltages of the supply vary in unison. Single-phase system involves a neutral wire and one power wire with current flowing between them. Single-phase electric power is most commonly used in homes and small commercial buildings where the large load is not required. The benefits of single-phase electric power range from efficient power supply up to 1000 watts, less complex design to a wide range of application uses.

The manufacturers in the global battery storage inverter market are strategically diversifying and launching new products to strengthen its position. For instance, ABB provides single-phase string inverters for the residential segment.

Single-phase and small three-phase inverters are used in residential application to run various items such as lights, kitchen appliances, and other power tools. These inverters are also being used in smart homes. The introduction of smart inverters is helping in increasing energy efficiency in smart homes. For instance, a smart home could instruct a washing machine to turn on only with the use of inverters with sufficient charge without the use of drawing electricity from the main grid, thus reducing the electricity charges. Therefore, the battery storage inverter aids to power the home at times of power outage and intermittent electricity supply.

North America battery storage inverter market was valued at USD 5.09 Bn in 2018 and is likely to grow at a CAGR exceeding 8.0% during the forecast period. Robust expansion of the energy storage systems market to support electrical grids, especially under highly stressed conditions and to avoid power blackouts in the region has mainly driven the battery storage inverter market. In the year 2015, 221 MW of storage capacity was installed in the United States.

Emerging technologies and favorable regulations have positively impacted the growth of energy storage. For instance, in 2017, New Jersey’s Office of Clean Energy allocated $2.5 million for incentives to help in the growth of energy storage in the region. New York has also set a target of 1500 MW by the year 2025. With the growing concerns over the use of fossil fuels, the use of solar energy is on a rise. The government is also formulating policies to support the growth of solar energy and this has further paved the way for the solar-inverter market. US accounted for the largest share of energy storage systems market with California being the foremost state with the energy storage capacity deployment. A report by Environment America estimated that the United States installed more than 53 GW of solar photovoltaic (PV) capacity. According to the U.S. DOE, in April 2017, the country had more than 24.2 GW of rated power in energy storage as compared to the service installed generation capacity that totaled 1,081 GW. Significant investments in renewable energy in order to reduce greenhouse gas emissions and improve the stability of electricity grids has led to the growth of solar energy. The below graph shows the growth of solar power from 2000 to 2017.