Solar industry not happy with bill

It says Senate plan would cede production to China

Tax incentives to stimulate domestic manufacturing of clean energy products are under threat by the policy bill the Senate passed on Tuesday, U.S. solar officials say. Christian Monterrosa — The New York Times

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By Ivan Penn

The New York Times

After the first Trump administration imposed tariffs on imported solar panels, companies opened or announced plans for new U.S. solar panel factories, reviving a manufacturing business that had largely withered away.

Those plans accelerated under the Biden administration, which offered generous tax incentives to manufacturers and developers of solar farms.

But now solar manufacturers fear that the Republican policy bill, which is still working its way through Congress after the Senate passed it Tuesday, would end the nascent revival and hand China virtually complete control of solar panel production.

“This is going to put people out of business,” said Mike Carr, the executive director of Solar Energy Manufacturers for America, which represents more than 15 companies and 6,100 manufacturing workers. “This is going to devastate the industry.”

Modern solar panels were developed at Bell Labs, AT&T’s research arm, in the 1950s. The United States was the leading manufacturer of panels as recently as the 1990s, but lost its lead over time. Production shifted first to Japan, then to Germany and ultimately China, which now makes a large majority of the world’s solar panels and the components and raw materials that go into them.

Various presidents have tried to bring back manufacturing with the help of federal aid and tariffs on imported solar panels. The most recent effort to help the industry was President Joe Biden’s Inflation Reduction Act. That law offered hundreds of billions of dollars in tax incentives for individuals and businesses to buy solar panels, along with electric vehicles and other clean energy technologies, to stimulate the domestic manufacturing of those products.

Now those incentives are under threat. In particular, manufacturers are worried about provisions in the Senate’s version of the policy bill that would phase out tax credits for solar and wind projects.

The Inflation Reduction Act included credits for solar projects regardless of where the panels used in them came from. But it offered an additional 10% credit to developers who used panels with a minimum amount of domestic content, a benefit that industry executives said raised demand for products made in the United States.

The Senate-approved bill would end that credit on Dec. 31, 2027; one provision would extend it for companies that began construction within a year of the bill’s enactment.

Talon PV, a company based in Houston, plans to build two factories to make the cells that are the building blocks of solar panels, said Adam S. Tesanovich, the CEO. But if Congress ultimately eliminates the tax incentives, it could jeopardize those projects.

Local Republican officials have urged leaders in Congress to retain the tax incentives that have helped their communities attract solar manufacturing plants, creating thousands of jobs.

Officials in Georgia noted in a letter to the Senate majority leader, John Thune, R-S.D., that their state was home to factories owned by South Korean solar manufacturer Hanwha Qcells.

“One of my top priorities as chairman of Whitfield County has been to maintain our status as the manufacturing hub of Georgia,” wrote Jevin Jensen, the chair of the Whitfield County Board of Commissioners. “Qcells’ investments in our county have supported these objectives by delivering thousands of high-quality jobs in the area for hardworking families.”

Jensen asked Thune to “support improvements to the bill that will promote American energy and manufacturing dominance in a way that continues the resurgence of manufacturing in Whitfield County.”