The energy storage industry is much like the ocean. There are many experiences of ups and downs. This results in no leading company maintaining a continuous rise to its current dominant position No one has smooth sailing.
Different Companies in Industry have made many changes and progress during recent years. Different countries have different amount of success throughout the years. There is a brief description of progress throughout different years given below:
In 2004, Germany revised the “Renewable Energy Sources Act”. China’s solar cell production surged due to being fueled by European market and its export revenues rapidly expanded. This marked the dawn of a global photovoltaic industry boom. Due to this Shangde CEO from Wuxi rose to become China’s wealthiest individual.
In 2006, China promulgated the “Renewable Energy Law of the People’s Republic of China”. This led to fast track development of the country’s photovoltaic industry.
In 2008, the United States subprime mortgage crisis erupted and it caused some European countries to put brakes on some of their photovoltaic policies. This caused a reduction in demand in the photovoltaic industry and a sharp decline in polysilicon prices.
In 2009, China initiated the Golden Sun Demonstration Project and franchise project bidding. This stimulated the recovery of the photovoltaic industry. This also kickstarted the first wave of enthusiasm in inverter development which lead to the success of major companies such as Suntech Power.
This caused China to take major market share in global photovoltaic inverter market which was previously dominated by foreign brands such as:
- Germany’s SMA and KACO.
- United States’ Power One and Satcon.,
- Austria’s Fronius.
These accounted for approximately 60% of the CR5 market share.
In 2011, the European debt crisis and the ‘double reverse’ measures by Europe and the United States once again dealt a severe blow to the photovoltaic industry chain. This led to overcapacity and a significant backlog for Chinese photovoltaic companies heavily reliant on exports which resulted in a sharp decline in silicon material prices. Many photovoltaic companies that depended on export profits went bankrupt, and even the photovoltaic giant Shangde from Wuxi applied for bankruptcy and restructuring.
The Chinese government continued to increase its support for the photovoltaic industry, creating domestic market conditions to sustain photovoltaic enterprises.
In 2012, Huawei established Huawei Digital Technology (Suzhou) Co. Ltd. with its business segment expanding into the inverter market.
With foreign markets facing a prolonged downturn, Chinese manufacturers concentrated their efforts domestically, leading to an impending price war. A few major players quickly seized market share with lower prices and profit margins which resulted in a tripartite structure dominated by following companies
- Suntech Power.
- Sungrow Electric.
These companies collectively held more than 80% of the ground-mounted power station market share.
Foreign brands were the first to struggle and began withdrawing from the Chinese market. With the exception of a few, including well-known companies like Emerson and Carola, they either turned to Taiwanese outsourcing for contract manufacturing or sold their assets to domestic brands. In that year, Zhaofu & Aisuo were directly acquired by SMA.
Companies like Growatt, Goodwe, Zhengtai, and Trannergy shifted their focus from centralized ground-based power stations, which were dominated by large Chinese enterprises, to distributed inverters. They redirected their efforts towards overseas markets such as Brazil and Sri Lanka.
In 2013, the State Council issued “Several Opinions on Promoting the Healthy Development of the Photovoltaic Industry”. It called for vigorous development of the distributed photovoltaic power generation market, orderly promotion of photovoltaic power station construction, and the consolidation and expansion of international markets.
In 2015, Huawei and Suntech Power’s inverter shipments surpassed SMA, making them the global leaders in the first and second positions. Suntech Power was the first to introduce a 1500V voltage level system solution, which was initially used in foreign power station projects. With lower Balance of System (BOS) costs and reduced losses, this technology played a crucial role in driving photovoltaic power stations towards grid parity.
In the same year, photovoltaic poverty alleviation was designated as one of the “Top Ten Precision Poverty Alleviation Projects” by the State Council’s Poverty Alleviation Office. The National Energy Administration introduced the ‘Photovoltaic Pioneer Program.
Starting in 2017, the National Electrical Code (NEC) in the United States required photovoltaic arrays to be equipped with remote rapid shutdown devices, known as “module-level shutdown”. Due to the absence of direct current high-voltage risks, microinverter solutions gained prominence in small and medium-power applications, with companies like Huawei and Enphase making significant advancements.
In 2018, the “531 New Policy” was implemented, which aimed to control the scale of photovoltaic installations and reduce subsidies. This had a significant braking effect on the domestic photovoltaic industry, leading to a severe squeeze in market demand and a revival of price wars. Companies like Shanyi New Energy and Maoshuo Power fell behind. To survive, some Chinese inverter companies embarked on the journey of expanding overseas.
In 2019, the prices of photovoltaic products in China were squeezed to the extreme, marking the first year of grid parity. Overseas demand saw a revival, and companies that operated successfully in international markets, such as Jinneng, went public in 2019, followed by GoodWe in 2020. This trend was also observed in previously listed companies like Suntech Power with overseas shipments surpassing domestic ones.
Due to aggressive price competition by Chinese manufacturers in the international market, in 2019, Schneider Electric (with a 5% market share), ABB (with a 2% market share), General Electric, and others chose to exit the inverter market or divest their businesses. SMA China (Aiswei) was acquired by its management.
From 2020 to 2022, the global COVID-19 pandemic swept the world, spurring the camping economy and mobile backup power demand. Huawei New Energy went public in 2022, raising 58 billion, while Enphase went public at the end of 2021, raising 56 billion. Sungrow went public in mid-2022, raising 32.6 billion. The entire industry experienced a surge in activity.