According to a new report published by Introspective Market Research, titled, Grid-forming Inverter Market by Type, Application, and End-User, The Global Grid-forming Inverter Market Size Was Valued at USD 0.8 Billion in 2023 and is Projected to Reach USD 2.1 Billion by 2032, Growing at a CAGR of 8.5%.

Introduction / Market Overview

The Grid-forming Inverter Market is gaining significant momentum as global energy systems accelerate their transition toward decentralized, renewable, and more resilient power infrastructures. Unlike traditional grid-following inverters, grid-forming inverters can independently create voltage and frequency references, enabling stable grid operation even in weak or fully renewable-powered networks. This capability makes them essential for next-generation energy systems integrating solar, wind, and battery storage.

As renewable penetration increases, grid-forming technology is emerging as a critical enabler for maintaining power quality, ensuring stability, and supporting grid modernization initiatives. Their rapid response capability, enhanced fault tolerance, and ability to operate autonomously provide substantial advantages over conventional inverters. The increasing need for flexible grid-support solutions across utility, commercial, and microgrid applications is driving strong adoption worldwide.

Market Segmentation

The Grid-forming Inverter Market is segmented into Type, Application, and End-User.

• By Type, the market is categorized into (Single-phase, Three-phase, Utility-scale).
• By Application, the market is categorized into (Renewable Energy Integration, Microgrids, Energy Storage Systems, Others).
• By End-User, the market is categorized into (Residential, Commercial, Industrial, Utility).

Growth Driver

A major growth driver for the Grid-forming Inverter Market is the surging integration of renewable energy sources into global power grids. As solar and wind installations expand, grid operators face challenges in maintaining stability due to declining synchronous generation. Grid-forming inverters address this gap by providing virtual inertia, black-start capability, and improved voltage/frequency control. Their ability to emulate conventional generators while supporting high-renewable environments makes them indispensable for future power networks. Government-led decarbonization initiatives, coupled with rapid investments in grid modernization, are further boosting demand for grid-forming inverter technologies.

Market Opportunity

A significant opportunity lies in the rising deployment of advanced microgrids and hybrid energy systems across remote areas, industrial facilities, campuses, and defense applications. Grid-forming inverters enable these microgrids to operate both in connected and islanded modes, ensuring uninterrupted and high-quality power. With growing investments in energy independence, climate resilience, and electrification of off-grid communities, microgrids are emerging as a major demand catalyst. The increasing adoption of battery energy storage systems (BESS) also amplifies the need for grid-forming inverters, creating a strong long-term market opportunity.

Grid-forming Inverter Market, Segmentation

The Grid-forming Inverter Market is segmented on the basis of Type, Application, and End-User.

Type

The Type segment is further classified into Single-phase, Three-phase, and Utility-scale.
Among these, the Utility-scale sub-segment accounted for the highest market share in 2023. As large-scale solar and wind farms expand, utility operators require advanced inverters capable of stabilizing grid frequency, providing synthetic inertia, and supporting high-voltage networks. Utility-scale grid-forming inverters ensure reliable power conversion and grid support, especially in weak grid regions with large renewable penetration. Their enhanced performance characteristics and compatibility with BESS systems have fueled widespread adoption across large energy infrastructure projects.

Application

The Application segment is further classified into Renewable Energy Integration, Microgrids, Energy Storage Systems, and Others.
Among these, the Renewable Energy Integration sub-segment accounted for the highest market share in 2023. As power systems increasingly rely on intermittent energy sources, grid operators must ensure stability, inertia, and dynamic response. Grid-forming inverters play a vital role by enabling seamless synchronization, improved frequency regulation, and enhanced reliability. Their application in large solar PV plants, wind farms, and hybrid renewable systems is expanding rapidly, supported by global clean energy targets and grid decarbonization policies.

Some of the Leading/Active Market Players Are

• SMA Solar Technology AG (Germany)
• ABB Ltd. (Switzerland)
• Schneider Electric (France)
• Siemens Energy (Germany)
• Huawei Technologies Co., Ltd. (China)
• General Electric (USA)
• Delta Electronics, Inc. (Taiwan)
• Sungrow Power Supply Co., Ltd. (China)
• Tesla, Inc. (USA)
• Eaton Corporation (Ireland)
• Hitachi Energy (Switzerland)
• FIMER S.p.A. (Italy)
• Dynapower Company, LLC (USA)
• Fronius International GmbH (Austria)
• Solaredge Technologies Inc. (Israel)
  and other active players.

Key Industry Developments

News 1: In March 2024, Siemens Energy launched its next-generation grid-forming inverter designed for utility-scale renewable installations to enhance grid stability and resilience.
The new inverter integrates synthetic inertia and advanced control algorithms enabling improved frequency regulation and seamless renewable integration. The solution supports global grid modernization initiatives and helps utilities address challenges posed by low-inertia systems.

News 2: In July 2023, ABB announced the deployment of its grid-forming inverter technology in a major microgrid project aimed at supporting remote industrial operations.
The project enhances autonomous power capability, enabling smooth islanding and reconnection while maintaining power quality. ABB’s technology plays a key role in improving reliability and operational efficiency for off-grid industrial facilities.

Key Findings of the Study

• Utility-scale inverters dominated the type segment in 2023.
• Renewable Energy Integration was the leading application segment.
• Asia-Pacific is expected to lead market growth due to expanding solar and storage installations.
• Increased renewable penetration and grid modernization remain primary growth drivers.
• Microgrids and BESS deployments offer strong future opportunities.