U.S. could surpass 100 GW of annual inverter manufacturing capacity by 2027

The federal government has added foreign-made power inverters to a list of equipment flagged as a national security risk. Inverters are the devices that convert power from solar panels or batteries into electricity your home can use. The decision, made by the FCC on July 28, blocks new foreign-made inverter models from being sold in the U.S. going forward, based on cybersecurity concerns. Right now the U.S. relies heavily on imports: over 90% of inverters installed here in the past decade came from overseas, with more than a third from Chinese manufacturers.

The change is expected to push U.S. solar and storage companies toward domestically made equipment. Industry analysts at Wood Mackenzie project that American manufacturing capacity for these inverters could top 100 gigawatts a year by the end of 2027, if current expansion plans hold. But domestic equipment costs more to make, so prices for inverters are expected to rise before 2027 as imports get replaced. Costs could ease later as U.S. production scales up, though the eventual phaseout of manufacturing tax credits after 2030 may push prices back up again.

For homeowners with solar panels or battery storage already installed, one open question is whether existing inverters will keep receiving firmware updates if the manufacturer is affected by these restrictions. The FCC says the rule mainly targets new, not-yet-approved models, but it can revoke approval for existing equipment under certain circumstances. Anyone planning a solar or storage installation in the next few years may see somewhat higher equipment costs as this shift plays out.