China Energy Storage Network News: Today we will publish a brief summary of the U.S. household storage, photovoltaic and inverter markets in the first half of the year. Unless there are major industry events, there will be no updates related to household savings in the US market in the near future. From the end of last year to the first half of this year, almost all mainstream industries and investment research institutions have been cautiously optimistic about the U.S. household savings market in 2023 and 2024. The main reason has been discussed before: the dual restraints of California’s “Net Measurement 3.0” policy, the absolute main market, and the Federal Reserve’s continued high interest rate policy. However, despite the relatively adverse general environment and the fact that leading companies on the track are internationalizing to diversify risks, there are still companies that are bucking the trend and breaking through. While its long-term performance remains to be seen, the path is worth exploring.

1. The price of optical storage systems is still rising, but the growth rate is slowing down

Based on data from the largest household photovoltaic storage system price comparison and trading platform in the United States funded by the U.S. Department of Energy, in the past four consecutive semi-annual statistical cycles, solar energy prices in the U.S. market have maintained an upward trend, but the growth rate in the first half of 2023 Significant slowdown, reaching $2.90 per watt, an increase of 1.8%. Prices for energy storage systems quoted during the same period increased by 1%. It is worth noting that prices on the platform began to decline in July and August, with early third-quarter price data showing a 3.5% price drop compared to the first half of 2023.

2. PV financing terms rise as interest rates rise

Between the second half of 2022 and the first half of 2023, the most frequently quoted solar loan changed from a 25-year term at 1.99% interest rate to a 25-year term at 3.99% interest rate. If calculated based on the average capacity of the PV system quoted by the platform, this means that the monthly payment in the first half of 2023 will be $30 higher than in the second half of 2022.

3. The advantages of the head brands are obvious, and new forces in China and India are emerging

In terms of the platform's most popular brand choices, the most frequently quoted PV brands are still Q CELLS' solar panels and Enphase's inverters and energy storage batteries. At the same time, some new brands have entered the top 10 most frequently quoted brands or gained market share in different categories, including Waaree solar panels, Hoymiles inverters, and FranklinWH batteries. Below, we briefly look at the background and recent trends of these three brands.

Waaree: China's photovoltaic manufacturing challenger?

Waaree Energy is one of the largest vertically integrated new energy companies in India. It was founded in 1989 and is headquartered in Mumbai, India. It belongs to the Waaree Group. The company has the largest solar panel manufacturing capacity in India, reaching 12GW, and is a leading company in EPC services, project development, solar roof solutions, solar inverters and solar water pumps. It is also an independent power producer.

Since the 25% and 40% tariffs on Chinese photovoltaic cells and components were imposed in April last year, the Indian government has begun to vigorously support local photovoltaic cell and component manufacturing capabilities. Therefore, although China's exports of photovoltaic cells and components to India have declined sharply, the export of component production and assembly equipment has benefited a lot. Considering that the scale and speed of local photovoltaic power generation deployment in India are relatively limited, Indian photovoltaic component companies have set their sights on the US market, which also has a strong desire to "reduce dependence on China".

Waaree's exposure in the US household photovoltaic market is just the tip of the iceberg of its efforts to expand the US market. In fact, Bloomberg reported in 2022 that Waaree was negotiating with local governments in the United States on a 2 GW module factory investment project. The IRA Act's requirement for the proportion of localized production for large-scale utility-scale photovoltaic projects applying for subsidies has had a comprehensive impact on the global photovoltaic cell and module production pattern.

Waree's current production capacity and dependence on upstream equipment and materials have not yet posed a substantial threat to domestic photovoltaic cell and module companies, but backed by the Indian domestic market and the United States, which have a more urgent need for clean energy transformation, its impact on China's parity photovoltaic manufacturing industry is worthy of attention.

Hoymiles: Successfully poached Enphase’s customers?

At the just-concluded RE+2023 exhibition, Hoymile not only showed off its core micro-inverter products, but also announced that it would launch household storage products in the United States. This move is intended to boost investor confidence, but it also shows that its pace of learning and following up with the leading inverter manufacturers is accelerating.

Previously, Hoymile successfully diverted some installers and users’ attention from Enphase with its 1500 series of “one-to-four” micro-inverter products with obvious cost advantages. In the future, after supplementing energy storage products, whether it can use product fusion to grab more price-sensitive customers from Tesla and Enphase will be an interesting topic. After all, inflation seems to have no signs of ending.

Having been fully exposed in the most important market of micro-inverters, Hoymile’s performance is still worthy of praise, but Hoymile also has big challenges that it has to face. Since it was listed on the Science and Technology Innovation Board in December 2021 at an issue price of 557.80 yuan per share, setting a new record for the highest issue price in China, its stock price and market value have started a crazy roller coaster-like ups and downs. On September 3, 2022, its stock price once reached 889.74 yuan, but as of the end of September recently, its stock price has been going down all the way and has been hovering around 250 to 270 for a long time. Judging from the revenue and profit information just released in the first half of 2023, although the revenue increased by more than 100% year-on-year, the year-on-year growth of net profit was only 72%.

With the relative easing of the energy crisis and increasingly fierce competition in the track, it is difficult for any company in the industry to replicate the similar performance growth myth in 2022. When will those Hemai investors who entered the secondary market at a high level be able to exit? I am afraid that only time can answer.

FranklinWH: A different kind of “Texas” adventure?

Those in the industry should already be familiar with FranklinWH. As a growing brand that is not very exposed in the domestic industry but attracts the attention of many industry professionals at overseas exhibitions, its operating entity, Fulanwashi, has a completely different style from those of domestic companies doing international business.

Solid products, localized brand communication and bold and cutting-edge market expansion methods are my most intuitive feelings. While most companies are rolling out homogeneous "micro-inversion" and "LFP" in California, FranklinWH spreads user stories from Texas, Florida and even the inland state of Arkansas on its official website and social media channels. When it comes to consumer decisions such as household solar energy storage that are related to household energy independence and stability, a series of vivid stories and experiences of using products to survive hurricanes, cold waves and floods will be more contagious than empty technical terms and prices.

Overall, although the household savings market in the United States is currently facing some challenges, if nothing else, FranklinWH is expected to be one of the ones to overcome the challenges. At least for now, they are one of the most localized foreign brands in terms of brand communication and market expansion (the "one" seems to be able to be removed). In addition, industry players have noticed from social media that FranklinWH seems to have recently begun to expand into another area with high premiums for household savings - Australia: step by step it is keeping pace with leading companies, and step by step it is ahead of its pursuers.