Solar

Clean energy companies urge Congress to pass reconciliation package

Clean energy companies urge Congress to pass reconciliation package
Inside a JinkoSolar Smart Facility (Courtesy: JinkoSolar)

More than 400 clean energy companies are urging leaders in Congress to act on legislation that would provide billions of dollars for clean energy deployment.

In a letter addressed to President Joe Biden, House Speaker Nancy Pelosi, and Senate Majority Leader Chuck Schumer, the Solar Energy Industries Association (SEIA) delivered a succinct, three-sentence message:

"The solar, storage and other clean energy industries stand ready to help build a cleaner, cheaper, and more secure domestic energy future for all Americans. Please pass the tools in reconciliation to help us make that possible. It’s time to get this done."

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SEIA said the industry will embark on a "day of action" in Washington to push for a reconciliation package that includes a long-term extension of the solar Investment Tax Credit (ITC) and a standalone credit for energy storage.

The trade group is also calling for the approval of the Solar Energy Manufacturing for America Act (SEMA). The legislation, which passed in the House last year, would provide incentives for domestic manufacturing throughout the solar supply chain.

“The time for rhetoric is over, and the only thing left is to cut a deal,” SEIA CEO Abby Ross Hopper said in a statement. “The solar and storage industry is motivated, mobilized, and ready to make our clean energy future a reality if Congress acts. It’s time.”

Last month, Biden gave the solar industry a two-year window to fortify its supply chain with a pause on new tariffs from modules imported from Southeast Asia.

The SEMA Act is seen as a crucial step to building out a U.S. solar supply chain. Provisions of the bill were included in the Build Back Better Act— the now-defunct reconciliation package that Democrats in Congress are aiming to recharge.

SEMA would create tax incentives of 11 cents/watt for integrated modules, 4 c/w for cells, $12/sq. m. of wafer, and $3/kg of polysilicon. Production of non-integrated solar modules would receive 7 c/w. Production of solar trackers and inverters would also receive credits.

Hopper discussed how the solar industry was able to sway Biden to pause new tariffs on imported modules in a recent episode of the Factor This! podcast.

Korean solar giant Hanwha announced plans to develop a "fully American" supply chain. (Photo courtesy: Hanwha)

A probe by the Dept. of Commerce was launched in response to a petition from San Jose, Calif.-based module manufacturer Auxin Solar. The company's CEO, Mamun Rashid, believes modules imported from four Southeast Asian countries — Vietnam, Malaysia, Cambodia, and Thailand — could be skirting trade duties against China.

While Biden's pause grants the solar industry a temporary reprieve, Commerce's investigation continues and could result in additional tariffs. Experts suggest building out a domestic solar supply chain to meet U.S. demand could take 2-3 years.

China controls 80% of key manufacturing stages for solar modules, according to a recent report from the International Energy Agency. IEA forecasts that China's share of polysilicon and wafer supply could reach 95% in the coming years.