US Solar Factories Face ‘Rude Awakening’ Amid Price Plunge
- US solar factories face uncertain future as cheap imports drive prices down, risking factory cancellations despite federal subsidies. Can Biden's clean energy push overcome global competition?
US solar factories are facing a "rude awakening" as cheap imports from Chinese companies are driving global cell and panel prices so low that even federal subsidies may not be enough to sustain domestic plants, according to a report from BloombergNEF. President Joe Biden has prioritized bringing clean energy manufacturing back to the US to create jobs and combat climate change.
The 2022 Inflation Reduction Act included a subsidy of 7 cents per watt for domestic solar panel factories using imported cells, leading to a wave of US plant announcements. However, the report warns that despite the subsidies, many planned US solar factories may not be built as global panel prices are expected to plummet from 23 cents per watt to 16 cents per watt by the end of 2025. Analysts predict that this could result in a significant number of factory cancellations.
Furthermore, the report highlights that the plants that do open are likely to use cells made with Chinese polysilicon, as it costs twice as much when sourced elsewhere. The US has been aiming to revive domestic solar manufacturing to reduce its reliance on Chinese supply chains.
Will US solar factories survive as global panel prices continue to drop?
- US solar factories are facing challenges as global panel prices continue to drop due to cheap imports from Chinese companies
- Despite federal subsidies, many planned US solar factories may not be built as panel prices are expected to plummet
- Analysts predict a significant number of factory cancellations due to the low prices
- Plants that do open are likely to use cells made with Chinese polysilicon, as it is more cost-effective compared to sourcing from other countries
- The US aims to revive domestic solar manufacturing to reduce reliance on Chinese supply chains and create jobs in the clean energy sector.
