Huatai Securities Projects Growth in Solar Storage Market and Sustained Demand for Inverters

Huatai Securities has reported that in March 2025, the export value of inverters from China reached 4.54 billion yuan, marking a 39.5% month-on-month increase. This surge is primarily attributed to seasonal factors and an acceleration in the construction of large-scale energy storage systems and commercial storage projects overseas. Notably, exports to Europe accounted for 1.773 billion yuan, representing a remarkable 63.7% increase from the previous month. The report suggests that the combination of interest rate cuts, the arrival of peak demand season, and the increase in large-scale energy storage projects are likely to further stimulate demand in Europe. Additionally, regions such as Southeast Asia and South America are actively developing solar energy storage, indicating a robust demand. In the long term, factors such as power outages, rising electricity prices, and significant growth in wind and solar installations will continue to drive demand. The inverter market is expected to transition from niche markets to emerging markets, and as the costs of solar energy storage decrease further, the market ceiling is anticipated to rise, supporting the sustained demand for inverters.

<h2>Core Insights</h2>
<b>Europe:</b> Seasonal improvements in demand with Germany implementing a dynamic pricing mechanism to stimulate storage needs.
<ul>
    <li>In March 2025, exports to Europe amounted to <b>1.773 billion yuan</b>, a <b>63.7%</b> increase from the previous month. As winter concludes, demand is gradually recovering, accompanied by a rise in energy storage installations.</li>
    <li>The decrease in the TTF natural gas futures price in the Netherlands has led to lower electricity prices, which may pressure household storage installations. Furthermore, Germany's dynamic pricing policy is expected to boost demand for residential and industrial storage solutions.</li>
    <li>In Ukraine, the significant improvement in power outages suggests that while household storage demand may face short-term pressure, reconstruction efforts could stimulate demand for large-scale storage.</li>
</ul>

<b>Asia:</b> India is expanding its energy storage funding, and Pakistan's net metering policy adjustments are enhancing storage adoption.
<ul>
    <li>In March 2025, exports to India reached <b>325 million yuan</b>, reflecting a <b>7.8%</b> month-on-month increase. The Indian government has announced an increase in its battery storage target from <b>4 GWh</b> to <b>13.2 GWh</b>, with contracts expected to be finalized by June 2025.</li>
    <li>Exports to Pakistan amounted to <b>286 million yuan</b>, a <b>52%</b> increase compared to the previous month. The government has introduced an <b>18%</b> consumption tax on solar net metering users and has reduced the net metering tariff from <b>27 rupees</b> to <b>10 rupees</b>, likely increasing residential storage interest.</li>
</ul>

<b>Middle East:</b> Progress in large storage projects and favorable conditions in several countries.
<ul>
    <li>In March 2025, exports to Saudi Arabia were <b>9 million yuan</b>, a <b>91.9%</b> decrease, while exports to the UAE reached <b>99 million yuan</b>, a <b>3.1%</b> decline. The fluctuations in monthly data are influenced by project timelines, but significant projects in the region are expected to drive long-term demand.</li>
    <li>Many countries in the Middle East are experiencing electricity crises. Turkey has announced a <b>25%</b> increase in residential electricity prices and a <b>10%</b> increase for industrial use, while banks in Iraq have begun offering low-interest loans for installing solar storage systems, stimulating demand.</li>
</ul>

<b>South America:</b> Brazil has announced a ten-year energy expansion plan, and Chile is accelerating its solar storage development.
<ul>
    <li>In March 2025, exports to Brazil totaled <b>269 million yuan</b>, a <b>4.2%</b> decrease. In April, Brazil's Ministry of Mines and Energy released a development plan for the energy sector from <b>2025-2034</b>, committing <b>3.2 trillion reais</b> to renewable energy, emphasizing storage as a key technology for grid stability.</li>
    <li>In March, exports to Chile were <b>13 million yuan</b>, down <b>25.2%</b>. Chile is entering a rapid development phase for solar storage, with significant projects expected to come online, which will likely boost inverter demand.</li>
</ul>

<b>Oceania:</b> The Australian government is providing financial incentives for household storage installations, targeting <b>1 million new installations by 2030</b>.
<ul>
    <li>In March, exports to Australia amounted to <b>126 million yuan</b>, a <b>12.2%</b> increase. The Australian Prime Minister has pledged <b>2.3 billion Australian dollars</b> to stimulate household storage installations, aiming to reduce installation costs by <b>30%</b>.</li>
</ul>

<h2>Conclusion</h2>
The continuous demand for energy storage is driven by various factors, including power outages, rising electricity prices, and significant growth in renewable energy installations. The inverter market is expected to see a strong long-term demand outlook. However, potential risks include slowing demand growth, increased market competition, rising raw material prices, and inadequate implementation of supportive policies.