Dive Brief:

• California-based Enphase, a developer of microinverter and storage technology sold globally, announced last week that its third quarter shipments reached  204 MW (AC),or 869,000 microinverters. That's a 10% increase in MW compared to the same quarter last year, Greentech Media reports. 
• Greentech Media reports the increase in sales is a bright spot in a relatively modest earnings statement. The company posted a Q3 net loss of almost $19 million and its earnings per share (-$0.28), missed analysts expectations. 
• A slowdown in the residential solar market likely contributed to the lackluster earnings report, Greentech Media noted, but the company is focusing on the growing Australian market for its solar-storage battery system that includes integrated software for homeowners. 

Dive Insight:

Enphase made waves earlier this year with its plug-and-play solar system whose software gives homeowners flexibility in their energy usage and storage. While the market for such systems is relatively limited, systems such as Enphase' could be useful in if pushback against net metering—a mechanism that allows customers to sell excess energy back to the grid at retail rates—continues. 

But back in September, Enphase released a commissioned study that showed the market for residential backup battery storage might not be what many expected. For backup power alone, the systems were just too expensive compared to a generator. But the study did showcase that companies offering other features of their residential devices could help increase battery storage sales, using Australia as an example. 

In a conference call with analysts after releasing its earnings, CEO Paul Nahi explained what the residential storage market looks like in Australia where the company is now shipping units.

"99% of the reason that people are putting in storage in Australia right now is effectively rate arbitrage, they want to minimize their utility bill," Nahi said. He explained that an existing feed-in tariff will expire in some parts of Australia, changing the economics of the market and driving the use of storage for use in the home. 

In order to do that, "[it] requires a storage device that can cycle multiple times a day," Nahi said, "It means that at any given time of the day you're either powering up or powering down your battery and because of that, and because of the cost of storage, backup we feel doesn't make a lot of sense for our battery."

Enphase began shipping its AC battery storage solution in Australia and New Zealand during the third quarter and officials say they have been pleased by the demand so far. The company said it finished the quarter with a total cash balance of $24.1 million.

A copy of the full transcript can be found here.