The business model of microinverter and power optimizer suppliers is set to shift from standalone units to integrated systems, such as Smart and AC modules, according to new analysis released by IHS Markit.
The annual IHS Technology PV Microinverter and Power Optimizer Report examines market size, pricing and vendor market share. It forecasts revenue for Smart and AC modules will jump from under $100 million in 2015 to almost $500 million by 2020.
"Suppliers are shifting their business model from selling stand-alone products to selling an off-the-shelf integrated model,” said Cormac Gilligan, research manager at IHS Technology. "This will help them capture new emerging markets, improve sales channel efficiencies and lower customer costs.
Microinverters and power optimizers will increasingly be installed in the factory in the form of AC and Smart Modules, the IHS Technology report said.
"Purchasing one unit is more attractive for customers than purchasing multiple parts and installing them one by one, and the market is adapting to that demand" Gilligan said.
The United States is the top market for microinverters and power optimizers, but Asian and European markets such as China, Japan, Australia, Germany, France and the Netherlands are forecast to experience strong demand over the next five years.
The market for Smart and AC modules will grow from less than 200 MW in 2015 to over 4 GW in 2020 as integrated products become favored in the global market, IHS Technology predicts.
The growth of the smart home technology market may provide an opportunity for Module Level Power Electronic (MLPE) suppliers to enter new markets and extend their partnership networks, according to the IHS Technology report.