Higher Costs, Insecure Software? How US Ban on Foreign Inverters Could Hit Solar
In a move that has sent shockwaves through the solar energy sector, the US Federal Communications Commission (FCC) has imposed a ban on foreign-made power inverters. These devices, which convert direct current electricity from solar panels into usable alternating current, are a crucial component of solar energy systems. The ban, which aims to promote domestic manufacturing and ensure the security of the US electric grid, has raised concerns about the long-term viability of existing inverters and the potential for price increases.
The Inverter Conundrum
Power inverters are complex pieces of electronics that require regular software updates to meet changing grid codes and cybersecurity regulations. According to Joe Shangraw, a solar market analyst at Wood Mackenzie, the ban’s software update deadline of January 1, 2029, may not be sufficient to keep existing inverters secure. “I think there is a question of whether even existing inverters will reach a state of obsolescence in several years,” Shangraw says.
The ban applies only to new foreign-made inverters, but existing models can continue to be sold. However, affected companies will need to apply to the FCC for approval to make significant software changes or hardware alterations, which could be a lengthy and uncertain process.
A Shift in the Market
The US ban is poised to shake up the solar energy market, with Chinese vendors like Huawei, Sungrow, and Solis dominating the global market for power inverters. According to Wood Mackenzie, Chinese vendors made up nearly 50% of the US inverter market share in 2024 and 2025. The ban has caused anxiety for consumers looking for affordable, DIY solar energy systems, but Shangraw notes that US sellers like Tesla, Enphase, and SolarEdge control an estimated 80-90% of the US market for larger residential solar systems.
The Impact on Consumers
The ban on foreign-made inverters is likely to lead to price increases or deprive US customers of lower-cost Chinese alternatives. “There could be price impacts, like solar could get more expensive if people have to procure more expensive equipment,” Shangraw says. On the flip side, paying a premium for a US-made inverter might be worth it to avoid uncertainty from the FCC’s ban.
A Waiting Game
As the solar energy sector waits to see what actually sticks, manufacturers are considering the impact of the ban on future product development. “Manufacturers are considering the impact, but at the same time, policies have changed course before, so I think a lot of them are waiting to see what actually sticks before making major moves,” says Robert D’Ambrosio, CEO of US Solar Supplier.
The ban has also raised concerns about the potential for a “tiered scrutiny” system, where products made in the US will have an easier path to approval, while products built outside the US, but outside China, may face additional review. New products coming out of China will likely face the most scrutiny.
A National Security Concern
FCC Chairman Brendan Carr has justified the ban by citing national security concerns, stating that a foreign entity could hack or introduce a vulnerability into the inverters to disrupt the electric grid. The ban is seen as a move to promote domestic manufacturing and ensure the security of the US electric grid.
As the solar energy sector navigates this new landscape, one thing is clear: the ban on foreign-made inverters is a significant development that will have far-reaching consequences for the industry. While the short-term impact may be minimal, the long-term effects of the ban remain to be seen.