Solar Inverters Becoming Cheaper and Smarter
Market Not Yet Fully Mature, Despite Significant Progress in Recent Years
In just a few decades, installations of photovoltaic (PV) systems have skyrocketed from a few MW globally each year to an estimated 35 GW in 2013 alone. And, as PV panels are becoming more efficient, more advanced, and less expensive, so are many of their components. That includes solar inverters, which convert the direct current produced by the PV panels to alternating current, which can be interfaced with the existing electrical grid.
While there have been significant advances in solar inverter technology in recent years, industry leaders agree that competition in the market will continue to drive down prices and advance technology and energy efficiency in coming years.
Bill Rever, an independent consultant in solar and renewable energy who has spent much of his career at BP Solar and Solarex, said solar technology has come a long, long way since he started in the industry three decades ago. “When I first started in PV, the industry was doing 14 MW globally on an annual basis,” Rever said. “Now, a 14-MW project is commonplace in the industry. It’s interesting to think about.”
Like PV panels, inverters have become markedly more efficient over the years. Whereas the best efficiency for an inverter 30 years ago was around 80 percent, Rever said, “Efficiencies in the largest inverters are now north of 98 percent. For residential systems, it’s typically 95 percent or higher.”
Uffe Borup, director of innovation and technology, Danfoss, agreed that great progress has been made in the efficiency of PV systems just in the past decade, adding that solar inverters have a “significant impact” on a system’s overall yield.
“The efficiency of Danfoss inverters has increased over the years — from 94 percent 10 years ago to well above 98 percent for current products,” Borup said. “The new MLX Series inverter features peak efficiency close to 99 percent and CEC [California Energy Commission] efficiency above 98.5 percent.”
Rudy Wodrich, vice president, solar, Schneider Electric, said solar inverter efficiency has absolutely improved over the past few years.
“The Conext Core XC central inverters for large-scale solar farms are best-in-class at 98.5 percent peak and 98 percent CEC-weighted efficiency,” Wodrich said. “In addition, we developed a proprietary predictive MPPT [maximum power point tracking] algorithm, which has been third-party tested to the IEC [International Electrotechnical Commission] standard for static and dynamic tracking and found to be 99.9 percent efficient. Under variable irradiance conditions, we do not believe anyone can match our overall efficiency.”
Mighty Micro Inverters
While solar inverters are increasing in efficiency, they are decreasing in size. In smaller PV systems, micro inverters, where every individual PV panel has its own inverter, are quickly becoming popular.
The advantage of these micro inverters, Rever said, is that if one inverter fails, the rest of the system will still be functional. “In a typical household system, where you may have a 5-kW array with 20 250-W modules, you’d only lose 5 percent of your power if one inverter fails.”
The other advantage to micro inverters is their ability to optimize the performance of the overall system. “Different panels have different characteristics, and they can have different outputs, like if one is in the shade,” Rever explained. “Micro inverters can have a fairly meaningful increase — as much as 10 percent or more — on output in a year.”
Wodrich said that while micro inverters may not always be the best option, especially for much larger systems, they certainly have their place in smaller systems, and they are definitely gaining in popularity.
“The larger the inverter being deployed in the block, the more potential for a large block of the solar power plant to be inoperative if that inverter is down for maintenance,” Wodrich said. “The decentralized approach is the opposite end of the spectrum, where 20-40 kW units are being utilized at a slightly higher initial inverter cost, but with the advantage of quick swapability and small harvest loss if a unit is down for repair. Schneider offers Conext Core XC UL-approved central inverter blocks, from 540 kW to 2.7 MW, for our customers.”
Increased Grid Stability
In addition to significant advances in efficiency, solar inverters have also experienced increased functionality over the past few years. One relatively recent trend is to include on-site storage that can be utilized during power outages.
“That’s an evolving area for system architecture for PV systems,” Rever said. “There’s an increasing desire for facility owners to have functionality during natural disasters and other things that might cause outages. If there were onsite storage, a rooftop system could provide electricity to the facility during an electrical outage.”
On a larger scale, grid stability has become increasingly important as the use of renewable energy continues to grow, said Mike Dooley, vice president of marketing, Advanced Energy (AE).
“This has brought about the rising trend of smart inverters with built-in grid-balancing capabilities,” Dooley said. “AE has been working with the DOE’s [U.S. Department of Energy] Solar Energy Grid Integration Systems initiative for years to develop advanced grid integration features and, most recently, was the first industry partner to begin work at National Renewable Energy Laboratory’s [NREL] new Energy Systems Integration Facility [ESIF] in Colorado.”
Wodrich said Schneider Electric has also made strides in improving grid stability. “There is a trend around increasing complexity of the interconnection requirements for large-scale solar plants and, therefore, the increasing importance of grid interactive functionality within the inverters, but also of the electrical equipment supplier to be able to integrate energy storage and a full plant controller as part of their offer,” he said.
“These advanced inverter features and the plant controller allow compliance with ramp rate control, dynamic power factor correction, frequency regulation, and voltage regulation requirements that the utilities are now beginning to impose,” Wodrich continued. “Schneider Electric is leading the charge in this area with its vast experience meeting the minimum technical requirements (MTRs) on several projects in Puerto Rico already.”
As solar inverters have evolved, safety has improved. “Historically, when PVs were a very small part of the electrical grid, the inverter had to provide a function called anti-islanding, where it would shut down if the utility grid went down,” Rever said. “This is for safety on the electrical lines so that people repairing the lines during an outage wouldn’t be subject to electricity being pushed back onto the line by the solar systems.”
Ease of installation has also improved with the increasing popularity of micro inverters. “The module becomes an ac device, and installation is much more traditional,” Rever said. “It’s like connecting other types of appliances that any electrician would be familiar with, unlike a dc module. It opens up the pool of qualified electrical installers.”
He added, “From a safety aspect, since you aren’t putting many, many PV modules together in series, you don’t have high dc voltages present in the solar array, and that’s a benefit from a safety point of view. High dc voltages are dangerous because of the potential of arcing and electrical shock.”
Even with advances in functionality, stability, efficiency, and safety, the price of solar inverters has decreased, largely because the cost of PV modules has fallen significantly in recent years, putting pressure on solar inverter manufacturers to cut prices, too.
“Inverters are the second biggest cost in a solar system,” Rever said. “The prices have come down a lot in this area, and they’re probably something like half of the cost they were five years ago.”
As solar installations continue to increase globally, competition between manufacturers is also increasing, which is also helping to drive down prices. “We may even see some companies drop out just because it’s become so competitive,” Rever added.
Though the price of PV panels has plummeted 60 percent in the past two years, inverter prices likely won’t fall as rapidly, Wodrich said.
“Inverters, as a technology, are fairly mature — there is very little difference between solar inverters, variable-speed drives (VSD), and uninterruptible power supplies (UPS),” Wodrich explained. “All of these use the same core power-conversion matrices, and so there has not been the same opportunity for technology disruption as we have seen in the panel sector.”
Dooley said advances in manufacturing have helped decrease the cost of solar inverters in the past few years. He added that more emphasis is now being placed on “lowering balance-of-system (BOS) costs in order to reduce overall system costs.”
Wodrich agreed, adding that being able to manufacture its VSD, UPS, and solar inverter products in the same factories allows Schneider Electric to keep the cost of its solar inverters at competitive levels.
“All of this gives us a great cost advantage while, for the customer, they still have the bankability of a $30 billion company standing behind the products,” Wodrich said.
An Evolving Market
Despite all of the recent advances in the solar inverter market, there is still room for improvement, Rever said. “Improvements in efficiency, reliability, and functionality are still coming down the road — it’s not fully mature, even with all the progress that’s been made.”
Danfoss is focused on innovation and optimization to help make its inverters as cost-effective as possible for consumers, Borup said.
“Our primary focus is the total cost of ownership — system cost, installation, operation, and maintenance — as the cost benefits achieved through system-level optimization are far greater and more effective in the long term than the initial inverter cost alone,” Borup said. “Recently, the adoption of distributed inverter architecture has held significant implications for the market. The use of mass-produced string inverters means that commercial and utility systems now can be built more effectively — and at lower system costs with faster uptime. The new Danfoss MLX inverter is designed to facilitate those benefits.”
Advanced Energy, which recently released two new inverters — its three-phase string inverter, the AE 3TL, and its 1 MW-rated inverter, the AE 1000NX — is working to further expand its selection of both distributed and central inverter solutions for the growing solar customer base, Dooley said.
“The inverter is the intelligent node — aka the ‘brain’ — of the PV system, and it continually enables us to add advanced features and controls to it, which actually increases the value of the inverter,” Dooley said. “The research and development team at Advanced Energy is always working to add greater customization and features to our inverters to benefit our customers.”
Wodrich said increasing competition and consolidation over the past couple of years, both via bankruptcy and acquisitions, has made it clear that the solar inverter market will only support a handful of companies that will be able to make the necessary investments and advances needed to be able to stay competitive and profitable.
“Only the truly global players who can easily refocus geographically will survive the turmoil of a market like solar, which is largely driven by government incentives that can evaporate overnight,” Wodrich said. “Also, the ability of any inverter supplier to support their products with a robust field service organization has become just as important to customers as initial cost and efficiency. A combination of bankability, advanced product features, and service support is required for success in the market today.”
Publication date: 12/9/2013