China's solar inverter market projected to decline in 2025

Global solar inverter market is expected to contract for two consecutive years post-2024.

China’s solar inverter market is projected to decline in 2025, a first since 2019.

According to Wood Mackenzie’s analysis, the Chinese market is expected to reach 304 gigawatts AC (GWac) this year.

“Despite this near-term uncertainty between the 14th and 15th five-year plan, China will maintain its dominance with over 2.9 terawatts AC (TWac) of cumulative inverter demand through 2034,” the company said.

Meanwhile, the Asia Pacific region excluding China (APeC) will grow to 89 GWac in 2025, supported by major investments in domestic manufacturing and emerging rooftop photovoltaic segments in India and Southeast Asia.

In the global scene, the solar inverter market is seen to contract for two consecutive years, declining 2% to 577 GWac in 2025 and a further 9% to 523 GWac in 2026. The downturn follows record shipments in 2024 and reflects market uncertainty across major regions, including China, Europe and the US.  

“After years of an exponential rise in solar inverter demand, continuous shipment growth is no longer realistic for even the top global inverter manufacturers. Instead, vendors will need to adapt to new demand drivers to stay competitive: hybrid solar-plus-storage systems, retrofits and repowering, cybersecurity features, 2000-volt architectures, and grid services,”  said Joe Shangraw, Research Analyst at Wood Mackenzie.

Inverter pricing continues its downward trajectory across all product categories, driven primarily by Chinese manufacturing competition and technological advances.

Utility-scale inverter pricing faces the steepest declines, with Chinese domestic three-phase string inverters expected to fall below $0.02/watts AC (Wac) and central standalone inverters approaching $0.01/Wac by 2034. 

“Following this current downturn, we do expect the solar inverter market to recover and even surpass the 2024 market size by the early 2030s,” Shangraw said.

“Electrification, AI demand growth, and a cyclical repowering market will provide a solid foundation for inverter demand over the next decade. Companies that navigate the current challenges whilst investing in next-generation technologies will emerge stronger when the market recovers in the late 2020s,” the expert added.