Grid-forming Inverter Market by Power Rating (Below 50 KW, 50-100 KW, Above 100 KW), Voltage ( 100-300 V, 300-500 V, Above 500 V), Type (Micro Inverters, String Inverters, Central Inverters), Application & Region - Global Forecast to 2028
[233 Pages Report] The global Grid-forming inverter market is expected to grow from an estimated USD 680 million in 2023 to USD 1,042 million by 2028, at a CAGR of 8.9% from 2023 to 2028. As the world shifts towards greater adoption of renewable energy sources like solar and wind, the need for grid-forming inverters becomes more pronounced. These inverters play a crucial role in stabilizing the grid and facilitating the smooth integration of intermittent renewable energy into the existing power infrastructure. In regions with underdeveloped or weak grids, grid-forming inverters can provide an effective solution to maintain grid stability and improve power quality.
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Grid-forming Inverter Market Dynamics
Driver: Rising Investment in Renewable Energy Sector
Rising investments in the renewable power sector is a key driver of the grid-forming inverter market. As the world transitions toward a more sustainable energy future, there has been a significant increase in investments in renewable power generation technologies such as solar, wind, and hydropower. These investments are driven by various factors, including the need to reduce greenhouse gas emissions, combat climate change, and enhance energy security.
Grid-forming inverters are crucial in integrating renewable power sources into the electrical grid. Unlike traditional grid-tied inverters that rely on stable grid conditions, grid-forming inverters can autonomously control the electrical grid's frequency and voltage. This enables renewable energy sources to contribute to grid stability and operate in islanded or microgrid configurations
Restraint: More espensive then traditional grid-following inverters
Grid-forming inverters are more complex than grid-following inverters because they need to be able to actively control the grid voltage and frequency. This requires more complex control algorithms and hardware. On the other hand, grid-following inverters only need to be able to track the grid voltage and frequency, which can be done with less complex control algorithms and hardware. Thus, grid-forming inverters are typically more expensive than grid-following inverters because of the extra complexity. The additional cost of grid-forming inverters is justified by the benefits they offer, such as improved stability and reliability of the grid and reduced cost of renewable energy integration.
Opportunity: Rising demand for Elctric Vehicles
The rising demand for electric vehicles (EVs) presents a significant opportunity for the grid-forming inverter market. As EV adoption continues to rise, there is a growing need for efficient charging infrastructure and seamless integration of clean power with the electrical grid. Grid-forming inverters play a crucial role in enabling this integration by enabling bi-directional power flow, allowing EVs to not only consume power from the grid but also inject power back into the grid when necessary. This vehicle-to-grid (V2G) capability enhances the flexibility and resilience of the energy system by utilizing the energy storage capacity of EV batteries. Grid-forming inverters enable EVs to act as distributed energy resources, providing grid support services such as load balancing, frequency regulation, and demand response.
Challenge: Grid codes and regulations to pose challenge for grid-forming inverter deployment
Grid codes are a set of regulations that govern the operation of the grid. They typically specify the requirements for the quality of power being generated, as well as the communication protocols used by inverters. Grid codes can vary from country to country and can be complex and difficult to comply with. In some countries, there are economic incentives for the deployment of grid-forming inverters. These incentives can help offset the cost of deploying grid-forming inverters, and they can also help encourage the development of new grid-forming inverter technologies. However, in other countries, there may be no such economic incentives.
Grid-forming inverter Market Ecosystem
Prominent companies in this market include well-established, financially stable manufacturers of market and components. These companies have been operating in the market for several years and possess a diversified product portfolio, state-of-the-art technologies, and strong global sales and marketing networks. Prominent companies in this market include Huawei Technologies Co. Ltd. (China), General Electric (US), SMA Solar Technology (Germany), Games Electric (Spain) and FIMER Group (Italy).
The 50-100 KW segment by power rating holds the second fastest growing segment in 2022
By power rating, grid-forming inverter market is segmented into below 50 KW, 50-100 KW, Above 100 KW. The increasing adoption of solar PV systems and small to medium-sized wind turbines in commercial and industrial applications has created a demand for grid-forming inverters in the 50-100 kW range. These inverters are essential for efficiently integrating renewable energy into the grid and ensuring grid stability. Grid-forming inverters in the 50-100 kW range strike a balance between capacity and cost-effectiveness, making them suitable for a wide range of commercial and industrial applications.
Above 500 V segment by Voltage is estimated to be the second fastest segment for grid-forming inverter market
Above 500 V grid-forming inverters are commonly used in utility-scale renewable energy projects, such as large solar farms and wind farms. These inverters are capable of handling high power capacities and efficiently integrating the generated electricity into the grid. The market for above 500 V grid-forming inverters was witnessing significant growth due to the increasing adoption of large-scale renewable energy projects and the need for high-capacity inverters to accommodate them.
Solar PV Plants segment by application is estimated to be the largest segment for Grid-forming Inverter market
Solar PV grid-forming inverters are specialized inverters designed to facilitate the integration of solar photovoltaic (PV) systems into the electrical grid while providing grid-forming capabilities. Solar PV grid-forming inverters play a critical role in modern energy systems, particularly in areas with high renewable energy penetration and the development of microgrids and distributed energy resources. They enable the efficient and reliable integration of solar PV power into the grid while contributing to the overall stability and sustainability of the electricity network.
Europe is expected to account for second largest market during the forecast period.
Europe accounted for a 26.1% share of the Grid-forming Inverter market in 2022. The region has been segmented into the Germany, Spain, UK, Netherlands, Italy and rest of europe. The grid-forming inverters have been gaining traction in Europe, driven by the region's increasing focus on renewable energy integration and grid modernization. Grid-forming inverters are becoming essential components of Europe's evolving energy landscape, supporting the integration of renewable energy sources and enabling grid stability and resilience.
Key Market Players
The market is dominated by a few major players that have a wide regional presence. The major players in the Grid-forming Inverter market are Huawei Technologies Co. Ltd. (China), General Electric (US), SMA Solar Technology (Germany), Games Electric (Spain) and FIMER Group (Italy). Between 2018 and 2022, Strategies such as product launches, contracts, agreements, partnerships, collaborations, alliances, acquisitions, and expansions are followed by these companies to capture a larger share of the market.
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This research report categorizes the grid forming inverter market based on type, application, voltage, power rating, and region.
By Type
- Micro Inverter
- String Inverter
- Central Inverter
By Application
- Solar PV Plants
- Wind Power Plants
- Energy Storage Systems
- Electric Vehicles
By Voltage
- 100–300 V
- 300–500 V
- Above 500 V
By Power Rating
- Below 50 KW
- 50–100 KW
- Above 100 KW
By Region
- North America
- Asia Pacific
- South America
- Europe
- Middle East & Africa
Recent Developments
- In Mar 2022, Huawei Technology has signed a strategic cooperation agreement with Meienergy Technology Co., Ltd. for providing smart PV and energy storage system for the 1 GW utility PV plant and 500 MWh energy storage system in Ghana which is NA developed by Meienergy.
- In Feb 2022, FIMER made a partnership with Vega Solar to supply 14 PVS-100 inverters, three-phase string solution in Albania. The PVS-100 is FIMER’s cloud connected three-phase string inverter solution for cost efficient decentralized photovoltaic systems for both ground mounted and rooftop applications
- In Oct 2021, SMA solar technology AG (SMA) has been chosen to supply central battery inverters to Australian integrated energy company AGL energy limited for world’s largest grid-forming storage project.
Frequently Asked Questions (FAQ):
What is the market size of the Grid-forming inverter market?
The Grid-forming inverter market size is projected to grow from USD 680 million in 2023 to USD 1042 million by 2028, at a CAGR of 8.9% during the forecast period.
What is the major drivers for grid-forming inverter market?
The growing demand for residential solar rooftop installations and distributed energy resources (DERs) has a significant positive impact on the growth of the grid-forming inverter market. As more homeowners and businesses seek to generate their own renewable energy through rooftop solar panels, there is a need for effective integration of these DERs into the grid. Grid-forming inverters enable the seamless connection of residential solar systems and DERs to the electrical grid by providing stability, voltage control, and frequency regulation. This increasing demand for residential solar rooftop installations and DERs directly drives the need for grid-forming inverters, leading to market growth..
Which is the largest-growing region during the forecasted period in grid-forming inverter market?
Asia Pacific is expected to account for the largest market size during the forecast period. Asia Pacific region have been gaining momentum due to the growing focus on renewable energy integration, grid modernization, and improving energy resilience. The Asia-Pacific region encompasses a diverse group of countries with varying energy needs and policy priorities.
Which is the second largest-growing segment, by power rating during the forecasted period in grid-forming inverter market?
The Above 100 KW segment, by power rating, is projected to hold the second -largest market share during the forecast period. Many countries and regions are setting ambitious energy transition targets, including increased renewable energy penetration. Above 100 kW grid-forming inverters are essential for supporting the integration of high-capacity renewable energy sources into the grid.
Which is the fastest-growing segment, by voltage during the forecasted period in grid-forming inverter market?
300-500 V, by voltage is projected to be the fastest growing market during the forecast period. These inverters are essential for efficiently integrating distributed energy resources, such as solar PV systems or small wind turbines, into the electrical grid while ensuring grid stability and reliability.
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This study involved major activities in estimating the current size of the grid-forming inverter market. Comprehensive secondary research was done to collect information on the market, peer market, and parent market. The next step involved was the validation of these findings, assumptions, and market sizing with industry experts across the value chain through primary research. The total market size was estimated through country-wise analysis. Then, the market breakdown and data triangulation were performed to estimate the market size of the segments and sub-segments.
Secondary Research
The secondary research involved the use of extensive secondary sources, directories, and databases, such as Hoover’s, Bloomberg BusinessWeek, Factiva, and OneSource, to identify and collect information useful for a technical, market-oriented, and commercial study of the global grid forming inverter market. The other secondary sources comprised press releases & investor presentations of companies, white papers, certified publications, articles by recognized authors, manufacturers, associations, trade directories, and databases.
Primary Research
The grid-forming inverter market comprises several stakeholders, such as component providers, product manufacturers, distributors, and end-users in the supply chain. The demand side of this market is characterized by industrial end-users. Moreover, the demand is also fueled by the growing demand of the renewable energy sector. The supply side is characterized by rising demand for contracts from the industrial sector, and mergers & acquisitions among big players. Various primary sources from both the supply and demand sides of the market were interviewed to obtain qualitative and quantitative information. Following is the breakdown of primary respondents:
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Market Size Estimation
- The bottom-up and top down approach has been used to estimate and validate the size of the grid forming inverter market.
- In this approach, the grid-forming inverter installation statistics for each product type have been considered at a country and regional level.
- Extensive secondary and primary research has been carried out to understand the global market scenario for various types of grid-forming inverters.
- Several primary interviews have been conducted with key opinion leaders related to grid forming inverters development, including key OEMs and Tier I suppliers.
- Qualitative aspects such as market drivers, restraints, opportunities, and challenges have been taken into consideration while calculating and forecasting the market size.
Grid Forming Inverter Market Size: Top-Down and Bottom-Up Approach
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Data Triangulation
The overall market size is estimated using the market size estimation processes as explained above, followed by splitting of the market into several segments and subsegments. To complete the overall market engineering process and arrive at the exact statistics of each market segment and subsegment, data triangulation, and market breakdown procedures were employed, wherever applicable. The data was triangulated by studying various factors and trends from both the demand and supply sides in the grid-forming inverters market ecosystem.
Market Defenition
A grid-forming inverter is a specialized power electronic device that can autonomously create and maintain a stable electrical grid without the need for a pre-existing grid connection. It is designed to control and synchronize voltage and frequency, enabling the integration of renewable energy sources and supporting grid stability in both grid-connected and off-grid operation.
The growth of the grid-forming inverters market during the forecast period can be attributed to the planned grid infrastructure programs across major countries in North America, South America, Europe, Asia Pacific, and the Middle East & Africa.
Key Stakeholders
- Analytics Vendors
- Communication Vendors
- Consulting Companies In The Energy And Power Sector
- DISCOMS
- Electric Utilities
- Energy & Power Sector Consulting Companies
- Energy Regulators
- Government & Research Organizations
- Government Utility Providers
- Independent Power Producers
- Investment Banks
- IT Vendors
- Managed Service Vendors
- Private Utility Providers
- Renewable Energy Generators
- Venture Capital Firms
Objectives of the Study
- To define, describe, and forecast the size of the grid forming inverter market by type, application, voltage, power rating, and region, in terms of value
- To estimate and forecast the global grid forming inverter market for various segments with respect to 5 main regions, namely, North America, Europe, Asia Pacific (APAC), South America, Middle East & Africa, in terms of value
- To provide comprehensive information about the drivers, restraints, opportunities, and industry-specific challenges that affect the market growth
- To provide a detailed overview of the grid forming inverter value chain, along with industry trends, use cases, security standards, and Porter’s five forces
- To strategically analyze micromarkets with respect to individual growth trends, prospects, and contribution to the total market
- To analyze the opportunities in the market for stakeholders by identifying high-growth segments and detail the competitive landscape for market players
- To strategically profile key players and comprehensively analyze their market rankings and core competencies
- To analyze competitive developments, such as joint ventures, mergers and acquisitions, contracts, and agreements, and new product launches, in the grid forming inverter market
- To benchmark players within the market using the proprietary competitive leadership mapping framework, which analyzes market players on various parameters within the broad categories of business strategy excellence and strength of product portfolio
- This report covers the grid forming inverter market size in terms of value.
Available Customizations:
With the given market data, MarketsandMarkets offers customizations according to the specific requirements of companies. The following customization options are available for the report:
Product Analysis
- Product Matrix, which provides a detailed comparison of the product portfolio of each company
Company Information
- Detailed analyses and profiling of additional market players
Growth opportunities and latent adjacency in Grid-forming Inverter Market