The Chinese solar photovoltaic (PV) inverter market, driven by the introduction of a national feed-in tariff, grew by over 400% in 2011 to over 2.5 GW in shipments, according to IMS Research.
Its latest report, the China Market for PV Inverters, also found that the solar PV inverter market was highly consolidated in 2011 and the 10 largest suppliers, which accounted for over 80% of shipments, included only one non-Chinese manufacturer.
The strong growth of the Chinese market and the dominance of domestic suppliers could lead to Chinese manufacturers gaining significant share of the global solar PV inverter market, IMS Research believes.
China's release of its national feed-in tariff scheme in July 2011 drove installations to reach around 2.4 GW – this created a solar PV inverter market worth more than US$300 million.
Unlike other major solar PV markets however, demand for inverters is not widely spread across many model types and inverters rated at 500 kW were by far the most popular last year.
"500kW inverters dominated utility-scale installations last year, as they best fulfil the project developers' requirements to install ground-mount stations quickly, beating the end of year FiT reduction. As a result they represented more than three-quarters of inverter shipments last year", says Frank Xie, Senior Analyst and Report Author.
Sungrow Power Supply, which recently listed on the Chinese stock market, was by far the largest supplier to the market in 2011, holding a share of more than one-third.
Chinese solar PV inverter suppliers dominated the domestic market last year, and Elettronica Santerno was the only western supplier ranked in the top 10 in 2011.
The rapid growth of the domestic market, and the strong hold Chinese suppliers have it may see the suppliers gain in the overall global market, the report concludes.
"Due to the drastically growing Chinese PV market, inverters shipped to China accounted for 10% of global shipments in 2011", Xie adds.
The report also reveals that the pricing for solar PV inverters in China is significantly lower than the global market.
"As per requirements of the project bidding rules, all inverters are required to be shipped with free installation and warranty for five years in China. Due to the very large nature of most of the projects being developed in China, prices of the winning bids are typically very low," Xie says.