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Enphase Energy: New Products, New Markets, Increased Marketshare, Lower Product Costs

Summary

Enphase's new technology could be a game changer like the Apple iPhone was.

Enphase's 6th-generation microinverter promises a lower cost while still maintaining superiority to the older central string inverter - power optimizer solution.

World leaders are pushing renewable energy — The market is huge!

Enphase now has a new invention, a new home energy solution to sell.

Enphase's Storage Solution gives the company a whole new revenue stream and complements their existing product portfolio.

Well, Cupertino is not that far from Petaluma, so maybe there is some synergy there! It hasn't even been a month since my last article on Enphase Energy (NASDAQ:ENPH), and the simplicity and ease of installation of Enphase's microinverter-based solar PV systems is going viral. Like the first iPhones that hit the streets almost a decade ago, the residential solar PV system which offers almost 100% guaranteed up-time for the system's lifetime is selling globally - and now Enphase has a simplistic, new storage system to accompany it - a whole new market, and the best part is that what Enphase Energy has done for residential solar PV systems by empowering customers with the ability to easily manage and monitor their own solar systems, they are now doing for battery storage, and selling a complete package - the Enphase Home Energy Management System.

Do new and existing solar PV customers need to think about storage with their solar photovoltaic solution? Yes, they should. Are Net Metering and FiTs contracts going to last forever? Most likely not, and in places like Australia, New Zealand, and Hawaii, to name a few, existing and new solar customers are turning to storage to address the policy changes so that they can store the energy their solar systems create instead of supplying the utility grid for free. There is an old saying: victory favors the prepared, and Enphase's long-range vision has prepared them for these changes in policy, and they are ready to take the advantage - Enphase Energy chose "Energy" over "Solar" in their company name because their long-range vision always has been to be a home energy system provider - the new Enphase Home Energy Management System is their masterpiece. The beauty of Enphase's AC Battery storage unit compared to most of the competitors is that their's doesn't push the "mortgage the farm" slogan upon you to buy their solution - instead, they work with your budget allowing you to buy some storage now, then more later on when your budget permits. Because of their storage product's modularity, they can give the customer the lowest cost-of-entry into this new market. Their new storage solution can be retrofitted into any existing solar PV solution out there, and that gives them a much bigger audience. Why should a customer have to make a 1-time, huge investment in a single vendor's storage technology when this safer purchasing option is available? The same way Enphase sells their microinverters is the way they are proceeding with their storage solution. Each of their AC Battery storage units includes its own microinverter - giving each AC Battery complete autonomy from the others - a complete, extremely elegant, lightweight, safe and certified,modular, scalable, all-in-one unit.

Older battery storage solutions required complete cooperation between each battery device, and if any one battery had an issue, it compromised the whole battery farm, that is, all the interconnected batteries. With Enphase's AC Battery storage solution, there is 100% fault tolerance so that even if an AC Battery unit fails, the other AC Battery units will continue working independent of the failed device, giving the customer true reliability. This fault-tolerance is a powerful attribute, and this is Enphase.

Not only do most of the competition's products not have Enphase's product modularity, they do not have their storage device designed with its own, internal state-of-the-art microinverter. Most storage solutions require multiple devices to install, multiple points of failure, multiple vendors to deal with - with Enphase, it's a single vendor, single product SKU - Enphase is simplicity. Remember when you had to buy the PC, buy the keyboard, buy the mouse, buy the monitor, et cetera? Now you have your single iPad, or MacBook Pro or single whatever. SolartEdge's StorEdge, the Tesla battery, the AC transformer device - they all come from different vendors; you need to purchase all of them in order to set up your home's storage solution; if any of them fail, then your whole storage solution is down, and for who knows for how long. The AC Battery is a single, modular, independent device which when configured with multiple AC Batteries gives the customer 100% fault tolerance with the lowest cost-of-entry. Using the computing analogy from above, which storage product do you think people will desire more? As we embrace the Internet of Things, it's easy to see why Enphase is growing market share, and globally, too. People want "cool" products, and people want it to be simple to install and maintain.

There are over half a million Enphase customers out there, with more coming onboard daily. An Enphase problem is a problem, not a crisis. A SolarEdge (NASDAQ:SEDG), SMA (OTCPK:SMTGF), ABB (NYSE:ABB) or Fronius central string inverter failure is a crisis - why? Because when you realize your central string inverter is no longer working for your solar PV system, you really don't know how long your entire solar system will be down for, and you are at the mercy of the installer, the string inverter vendor, and your friendly utility company! As a solar customer and installer, I don't want a crisis - a single failed microinverter problem, sure, I will accept that; for example, if I were to experience a microinverter failure today, I could take care of it some time next week after Labor Day during normal business hours, knowing from the monitoring of my home's solar system using my browser, that the other 72 microinverters of my system were still running fine - that is the power of microinverters over a single central string inverter. Since installation of my solar system in 2013, I have yet to experience a problem, and I have 73 Enphase microinverters.

Enphase is proving their new storage system is cutting-edge in the Australia - New Zealand market right now. An article in the Australian Financial Review on August 31, claims Enphase is more than doubling their initial sales projections with 70,000 battery systems projected for the year alone. A comparison of the AC Battery product to competing products gives excellent marks to Enphase's AC...


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