Reconstructing Core Competitiveness in the Inverter Industry Amid Industry Cycles and New Policies

The year 2025 marks a historic turning point for the distributed energy market in China. The National Energy Administration and the National Development and Reform Commission issued two significant policies for the photovoltaic (PV) industry. This sector is undergoing a dramatic shift from being “policy-driven” to “market-driven.” The combination of these new policies and the evolving industrial cycle has introduced considerable uncertainty for companies operating in the solar energy space. This transformation, framed as a rite of passage into a “market” environment, is reshaping the survival strategies of millions of PV enterprises.

The previous profit model, which relied on fixed electricity prices for stability, has collapsed. In its place, companies now need to accurately predict customer electricity consumption patterns, engage in strategic pricing in the spot market, and tackle technical challenges related to grid capacity. Consequently, both emerging companies and established players must rethink their strategies to navigate this new landscape.

<h2>Challenges and Opportunities in the New Policy Landscape</h2>

In 2025, the Chinese distributed photovoltaic industry will experience a major policy shift. On January 17, the National Energy Administration officially released the "Management Measures for the Development and Construction of Distributed Photovoltaic Power Generation." Before April 30, commercial distributed photovoltaic systems can connect to the grid at full capacity; however, after this date, small commercial systems will only be allowed to self-consume electricity, with excess power fed back into the grid, while large industries can either self-consume or participate in spot trading.

On February 9, the National Development and Reform Commission and the National Energy Administration jointly issued Document No. 136, which clearly delineates the end of old policies. By May 31, existing projects will continue under the current supportive policies, but all new projects will have their electricity production entered into market trading. The introduction of these two documents will have far-reaching implications for the distributed photovoltaic sector.

In terms of profit models, the traditional reliance on guaranteed feed-in tariffs will gradually fade, requiring companies to pivot toward self-consumption or market-based trading models. This shift demands improved capabilities in forecasting electricity demand on the user side and pricing analysis in market transactions. From a technical standpoint, the new regulations emphasize the ratio of self-consumption and grid capacity, compelling enterprises to optimize system designs and enhance operational capabilities to adapt to the new market environment.

<h2>Technological Advancements in Inverter Solutions</h2>

The new regulations are promoting a more intelligent, efficient, and reliable operation model for distributed photovoltaic systems, thereby enhancing the overall capacity for solar energy integration. Inverters play a crucial role as the key hardware that connects solar panels to the grid, responsible for data collection and power regulation, and are now subject to heightened technical standards under the new regulations.

The competitive landscape is shifting towards a more refined focus, with the efficiency of photovoltaic equipment increasingly impacting the profitability of solar power plants. Given the inherent volatility of solar energy, inverters must possess capabilities such as high/low voltage ride-through and frequency response to ensure stable grid operation. Products that demonstrate superior efficiency, intelligence, and grid compatibility will stand out in the competitive market.

<h2>Market Dynamics and Company Strategies</h2>

The implementation of the new distributed regulations and Document No. 136, coupled with the cyclical nature of the photovoltaic industry, is pressuring inverter manufacturers to upgrade and transform. Companies that can leverage their advantages will emerge successfully, while those that cannot adapt will likely be eliminated from the market. As an established player in the inverter industry since 2009, Chint Power has accumulated significant experience in navigating industry fluctuations and transformations.

Chint Power has developed leading product technologies, including direct current arc detection technology, five-level transformerless inverter circuits, and virtual grounding technologies, holding over a hundred core patents recognized in countries such as the United States, Germany, Spain, Italy, Austria, and South Korea.

<h2>Innovative Approaches in Inverter Deployment</h2>

Chint’s inverters are designed to work efficiently under low-voltage conditions, enabling them to capture generation opportunities during early morning low-light conditions. This capability maximizes the benefits of time-of-use pricing, allowing for higher revenues during peak pricing periods. With a maximum power point tracking (MPPT) voltage range of 200-1000V, Chint inverters adapt well to fluctuations in solar irradiance, minimizing downtime due to voltage range issues.

Moreover, the inverters enter a low-power sleep mode during nighttime or extremely low light conditions, which reduces unnecessary energy consumption and ensures rapid startup for the following day. Currently, about 20 provinces in China implement low or deep valley pricing during midday hours, making peak solar generation times favorable for market pricing. The release of Document No. 136 will further accentuate this trend.

<h2>Maintaining Competitive Edge in a Crowded Market</h2>

In the competitive landscape of centralized state-owned enterprises, Chint Power has repeatedly succeeded in securing contracts for photovoltaic inverter projects. Centralized state-owned enterprises dominate the inverter market, imposing high standards for product quality, supply capabilities, and post-sale service. Chint Power's repeated success in these projects reflects its strong market position.

Chint Power emphasizes "local adaptation" in its approach to overseas markets, customizing products based on regional installation, usage, and maintenance practices. This strategy effectively reduces installation and maintenance costs, enhancing the competitiveness of its products both domestically and internationally. According to S&P Global, in 2023, Chint Power achieved a 29.5% market share in the South Korean inverter market, the highest in the sector, and approximately 28.1% in the U.S. commercial inverter market.

<h2>Looking Ahead: The Future of the PV Industry</h2>

As the photovoltaic industry faces increasing competition and declining profit margins in international markets, Chint Power maintains a stronghold on high-value markets due to its strategic foresight. Moving forward, Chint Power is well-positioned to leverage policy support and technological advancements, along with its robust technological foundation, comprehensive product system, and strong market development capabilities. This will enable the company to continue advancing in the competitive landscape of the photovoltaic industry and contribute significantly to global energy transition and green development.