SolarEdge closes utility-scale energy storage division to focus on ‘core’ solar PV business

LinkedIn
Twitter
Reddit
Facebook
Email

SolarEdge has closed its utility-scale battery storage division, resulting in a layoff of roughly 12% of its total workforce.

The NASDAQ-listed solar PV and energy management solutions company, headquartered in Herzliya, Israel, announced the discontinuation of the division yesterday (27 November).

This article requires Premium SubscriptionBasic (FREE) Subscription

Enjoy 12 months of exclusive analysis

  • Regular insight and analysis of the industry’s biggest developments
  • In-depth interviews with the industry’s leading figures
  • Annual digital subscription to the PV Tech Power journal
  • Discounts on Solar Media’s portfolio of events, in-person and virtual

Or continue reading this article for free

The move reduces the company’s headcount by around 500 employees, most of whom are based in South Korea, where SolarEdge acquired a majority stake in industrial and utility battery manufacturer Kokam in 2019.  

According to a Form 8-k filed with the US Securities and Exchange Commission (SEC), “almost all” impacted staff will be dismissed in the first half of 2025.

The move is expected to incur costs of up to US$99 million in aggregate pre-tax discontinuation and asset-related charges and between US$36 million and US$48 million for costs, including severance packages and non-cancellable purchase orders.

However, SolarEdge said it expected to offset “all cash payments relating to these charges” through selling off the division’s assets, although the costs given are estimates and could be higher. Long-term, the company expects the closure to result in around a US$7.5 million reduction in quarterly operating expenses.

These include manufacturing facilities for lithium-ion (Li-ion) battery cells and packs in South Korea. The company opened a factory with 2GWh annual production capacity in 2022, in Eumseong Innovation City, Chungcheongbuk-do Province, using technologies developed by Kokam.

Most of the employees to be let go work in manufacturing, SolarEdge said. The company is best known for its activities in the residential and commercial & industrial (C&I) solar PV market, including the development and production of power optimisers and inverters.

The closure of the company’s energy storage division is part of a strategic move to “focus on its core solar activities,” although SolarEdge said its solar business will continue selling battery products into the residential and C&I space.

It was not clear from announcements whether those products for distributed applications, including cells, will be supplied from SolarEdge in-house production facilities.

When the factory opened, the company said it would be primarily producing nickel manganese cobalt (NMC) cells for the residential segment, while a second factory has since gone into operation.

While cells were being shipped worldwide, residential battery systems were assembled in Europe.

Energy-Storage.news has contacted the company to request clarification on this and other points and will update this story in due course as applicable.  

‘Difficult period’

The shuttering of the division follows a “difficult period” for the company, according to recent remarks by interim CEO Ronen Faier, in which revenues and profits have plummeted.

In its financial results release for the third quarter of 2024, published earlier this month, SolarEdge reported US$260.9 million in revenue, down 64% year-on-year from US$725.3 million in Q3 2023. Its GAAP gross margin was -269.2%. A year ago, it had been 19.7%.

That included a -245.8% gross margin for its solar business. During the quarter, an asset valuation analysis resulted in a write down and impairment of assets to the value of US$1.03 billion.

“As SolarEdge weathers this difficult period in the company’s history, we are diligently pursuing three main priorities: financial stability, recapturing market share and refocusing on our core solar and storage opportunities,” interim CEO Faier said in prepared remarks about the results on 6 November.

In Q4 2021, when SolarEdge shares hit an all-time high of US$365.13, the company reported 1.9GW of total shipments across its product lines for the quarter, whereas in Q3 2024, it shipped just 850MW. Its share price was US$14.86 as markets closed last night.

Other major solar PV inverter manufacturers across the space are also facing tough market conditions driven by factors including falling prices, shifts in market demand across regions and the race to stay on top of technology advancements. SMA recently laid off more than a thousand staff, while Enphase, another rival largely focused on residential and C&I applications, announced a similar level of job losses to SolarEdge.

The topic of inverter market evolution was covered in a recent PV Tech Premium article in which Cormac Gilligan, associate director of clean energy technology at S&P Global, discussed the industry’s “growing pains”.

Energy-Storage.news’ analysis

Some media have speculated that SolarEdge’s move will allow it to focus more on activities, including production of inverters in the US, where it recently monetised 45X Advanced Manufacturing Tax Credits available through Inflation Reduction Act (IRA) legislation for US-made products.

SolarEdge first announced its intention to acquire a 75% stake in Kokam for around US$88 million in 2018 and a company executive told Energy-Storage.news at the time that this would enable it to vertically integrate its offerings into a “one-stop-shop” for customers.

Lior Handelsman, one of the company’s founders – who has since left – also said it would enable diversification into non-solar areas such as grid-connected standalone utility-scale battery energy storage systems (BESS).

It was an interesting move for a distributed solar PV company to acquire a manufacturer that had a BESS business more closely associated with front-of-the-meter battery applications than in the residential or C&I space.

It may also become the subject of speculation that Kokam was focused on the development and production of NMC cells. Nearly all of the global grid-scale BESS market has moved towards lithium iron phosphate (LFP) battery chemistry as a more typical choice over the past five years or so.

Indeed, at the beginning of 2023, SolarEdge announced that shipments had begun for a new line of 8,000-cycle NMC cells from South Korea, aimed at residential, C&I and utility-scale applications.  

After yesterday’s announcement, the company put out a post on networking site LinkedIn to clarify and reassure customers that activities in the residential and C&I battery space would continue via SolarEdge’s solar division, having received some enquiries to that effect.

17 June 2025
Napa, USA
PV Tech has been running PV ModuleTech Conferences since 2017. PV ModuleTech USA, on 17-18 June 2025, will be our fourth PV ModulelTech conference dedicated to the U.S. utility scale solar sector. The event will gather the key stakeholders from solar developers, solar asset owners and investors, PV manufacturing, policy-making and and all interested downstream channels and third-party entities. The goal is simple: to map out the PV module supply channels to the U.S. out to 2026 and beyond.
1 July 2025
London, UK
UK Solar Summit 2025 will look at the role solar currently plays in the energy mix, how this will change over the coming years and how this aligns with net-zero and other government targets. We will break down all these challenges and help build up solutions through discursive panels, motivational keynotes and case studies, with newly added interactive sessions to get you moving and meeting your peers, making the connections you need to boost your business.

Read Next

December 6, 2024
US renewable energy developer, Longroad Energy announced financial close of 111MWdc solar and 85MWac/340MWh storage project Sun Pond in Maricopa County, Arizona 4 December.
Premium
December 5, 2024
Hawthorne Renewable Energy has commenced permitting for a 300MW solar project co-located with a 300MW/1,200MWh BESS in Grant County, Washington.
Premium
December 4, 2024
Dallas, Texas-based independent power producer (IPP) Stellar Renewable Power has secured a Special Use Permit (SUP) to construct and operate a 1GW/4GWh BESS project co-located with a 1GW solar farm in Navajo County, Arizona.
Sponsored
December 4, 2024
HyperStrong, a global leader in providing energy storage solutions, launched its smart, reliable and innovative products into the US market in 2023.
Premium
December 3, 2024
Energy-Storage.news hears from the CEO of American Energy Storage Innovations (AESI), about its BESS technology, battery cell strategy, manufacturing in East Asia and the “shocking” price of manufacturing in the US and buying US-made cells.

Most Popular

Email Newsletter