Citing potential for up to $1.4 billion from U.S. investment tax credits offered in the Inflation Reduction Act, and other public incentives, Swiss solar manufacturer Meyer Burger said it will redirect equipment from a planned German solar cell factory to Colorado, where it will revamp a former semiconductor fabrication facility in Colorado Springs to produce 2 GW a year of cells.
A $300-million loan to Meyer Burger from the U.S. Department of Energy, a $90-million financial package offered by the state and city and prepayment from module off-take partners will also help finance the project, said the firm on July 24, although its overall construction cost was not disclosed.
The new plant will supply Meyer Burger’s 2-GW solar module production facility in Goodyear, Ariz., enabling it to meet new U.S. domestic content mandates. The manufacturer said in June it is "finalizing construction" of that facility.
Meyer Burger selected the Colorado Springs site “for fastest possible market entry” of the solar cell faciity with production expected to begin in the fourth quarter of next year," it said. The tax credits will start with production and continue through 2032.
“By expanding its strategy to 'Made in the USA' solar cells, Meyer Burger is responding to market requirements resulting from new regulations in the United States,” CEO Gunter Erfurt said, noting an additional 10% bonus investment tax credit for U.S. solar projects. “We are already exploring opportunities to add further solar cell and module production capacity in the country.”
The Meyer Burger announcement "is the latest example of the American solar manufacturing renaissance made possible by smart clean energy policies,” George Hershman, CEO of SOLV Energy told ENR. “As the solar industry surges forward, having a robust domestic supply chain here at home will strengthen our energy independence in the long run.”
New Wave of Investment
The Swiss firm's announcement of the cell plant was shortly followed by one from First Solar, the largest U.S. solar panel maker, that it will spend $1.1 billion to build its fifth domestic production factory.
UPDATE AUGUST 10: The firm said it will build its new facility in Louisiana's Iberia Parish, which state economic development officials said "is believed to be the largest single capital investment in the area’s history."
The Louisiana announcement referenced state "incentives offerings," as well parish-funded site improvements such as water and wastewater infrastructure, but the state did not disclose the investment amounts.
First Solar said the planned 3.5-GW factory will boost its U.S. manufacturing capacity to 14 GW. It now makes components in three Ohio plants, with one in Alabama to open in 2025. The panels to be made in its new plant will have 100% U.S. components, the firm said, adding that its cadmium telluride technology does not rely on polysilicon used now for most U.S. solar panels but largely produced in China.
According to the state, First Solar is "unique among the world’s 10 largest solar panel manufacturers as the only company with a U.S. headquarters and without a base of operations in China." Company CEO Mark Widmar said its solar manufacturing order backlog is about 78 GW.
India-based Vikram Solar said in June it will invest up to $1.5 billion in U.S. solar manufacturing plants in Colorado next year through a newly formed company, VSK Energy. Projects are meant to leverage India’s manufacturing expertise to compete with China. The state is offering $9 million in tax credits to support the 2-GW annual-capacity plants, with plans to double the capacity.
VSK Energy is a joint venture between Vikram and Phalanx Impact Partners, a U.S. private equity firm with a sustainability focus and Das & Co., which has solar holdings in the U.S. and India. “The passage of the Inflation Reduction Act was a landmark moment for the clean energy future of the United States,” Sriram Das, co-chairman of VSK Energy, said.
Chinese solar panel maker Longi Solar and U.S. firm Invenergy said in March they will jointly build a 5-MW solar panel factory in Ohio, under a new company called Illuminate USA. Invenergy said it has invested $600 million in the plant.
The U.S. Energy Dept. says about $9 billion in solar manufacturing has been announced, including more than 60 new and expanded plants.
U.S. Solar Projects R&D Get New DOE Millions
As a boost to U.S. solar component production, the agency also announced this month $45 million in new funding, $18 million from the 2021 infrastructure law, to support pilot manufacturing. That will include development of "dual-use technologies" such as agrivoltaics and building-integrated photovoltaics to create new markets for U.S. products and "serve another function beside the generation of electricity," said DOE. "By integrating solar energy systems into existing landscapes, dual-use PV has the potential to minimize land-use concerns."
DOE also announced $20 million in infrastructure law and other funding to reduce materials use in solar energy projects and improve installation quality, resilience and recyclability of end-of-life PV systems and solar panels.
More than 6 GW of solar capacity was installed in the second quarter this year, driven in large part by reduced supply chain challenges, said consultant Wood Mackenzie. Domestic module capacity is expected to rise to more than 60 GW by 2026, up from 9 GW currently, and the solar market is set to triple installed capacity to 378 GW by 2028, the consultant said.
Florida based solar developer BrightNight said July 25 that it will invest $1 billion to build an 800-MW solar installation on a reclaimed coal strip mine in eastern Kentucky. Construction on the four-phase project is expected to be completed by 2030.