SolarEdge Technologies (SEDG)
SolarEdge has shipped 24 GW of inverter systems to over 130 countries since 2010
in revenues, 2016 - 2020
Million Metric Tons
of greenhouse gas emissions have been avoided by SolarEdge' solar PV inverter systems as of 2019
The Path to Drawdown: PV Solar
To mitigate climate change and remain below 1.5ºC above pre-industrial global temperature, we need to transition away from burning fossil fuels to 100% emissions-free energy sources.
A powerful source of this clean energy is the sun (along with nuclear, wind, hydroelectric, and geothermal energy). Photovoltaic (PV) solar panels (the kind you see on rooftops) have emerged as the predominant way of capturing the sun's energy and converting it into electricity.
The industry has been growing fast. As of 2020, solar panels are now the cheapest source of electricity in most places on earth.
Solar produces around 2% of global electricity today. According to Project Drawdown, to be on the path to remain under 1.5ºC of warming, rooftop and utility scale solar will need to be generating a combined ~40% of global electricity by 2050.
To get there, the PV solar industry will need to keep scaling massively over the few next decades:
- 457 TWh of solar electricity generated in 2018
- 28,200 TWh needed by 2050
- CAGR of 13.75% from 2018 - 2050
Analysis from the IEA also projects that, to reach a 100% clean electricity grid by 2050, annual addition to the solar panel manufacturing capacity will need to increase from 134 GWs in 2020 to 630 GWs in 2030 (p. 74).
SolarEdge Technologies, Inc. (stock ticker: SEDG) is a provider of power optimizer, solar inverter and monitoring systems for residential, commercial and small utility-scale solar installations. It has more recently expanded into other areas of energy technology, including energy storage systems, backup electric vehicle components and charging capabilities, and many more. Headquartered in Herzliya, Israel, SolarEdge has offices in the US, Germany, Italy, and Japan.
SEDG's Role in Drawdown
SolarEdge’s main products are inverters and power optimizers which are a critical component in making rooftop solar panels an efficient source of renewable energy.
Harvesting the energy from solar panels requires converting the variable direct current (DC) that the panels generate into utility frequency alternating current (AC). AC can then be fed into a commercial electrical grid or used by local, off-grid electrical networks. The piece of machinery that converts DC into AC is the inverter.
But if a solar PV system is partially covered by shade or debris, or has panels with multiple orientations, the energy generated by the system as a whole will be dragged down by the worst-performing panel.
A power optimizer accounts for this problem. By being connected to each solar panel and tracking and maximizing their voltage before sending it to the inverter to be aggregated, power optimizers enhance the efficiency of solar systems.
SEDG: What We Like
SolarEdge has been growing aggressively over the past several years by shipping more inverters and power optimizers, and by expanding into other areas of renewable energy technology:
- Revenue increased from ~$240 million in 2017 to $1.4 billion in 2020, a 508% growth
- 20.18% and 20.36% CAGR in the number of inverters and power optimizers shipped worldwide, respectively
- A number of partnerships (p. 7) and acquisitions to enter new spaces, including PV storage and backup power solutions, uninterruptible power supply, etc.
Amidst this expansion, SolarEdge has made commitments to reduce their GHG emissions:
- In 2020 they set a goal (p. 28) to reduce GHG emissions by 30% per one million dollars in revenue and to reduce emissions by 20% per GW inverter power supplied to customers
In 2019 they introduced (p. 28) zero-emission solar PV generation as a means of reducing their emissions footprint. Ultimately, the company aims to become a zero carbon manufacturer
SEDG: What We Want to See Improve
Set Clear Timelines for Emissions Reduction Goals
Track Scope 3 Emissions
Switch to Consuming Renewable Energy
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