The climate and tax law, which President Biden signed in August and aims to boost American manufacturing while promoting the use of renewable energy and electric vehicles, seems to be having some success.
The construction of a sizable manufacturing center in Georgia will cost $2.5 billion, according to a Korean solar business named Hanwha Qcells, which made the announcement on Wednesday. Both entire solar panels and essential solar panel components will be produced at the site. A portion of the supply chain for solar energy, which is currently headquartered primarily in China, might move to the United States if the company's ambitions come to fruition.
Seoul-based Qcells claimed that the investment was being made in order to benefit from tax incentives and other provisions of the Inflation Reduction Act, a measure that Mr. Biden signed last summer. Around 50 miles to the northwest of Atlanta, in Cartersville, Georgia, and at an existing plant in Dalton, Georgia, the industrial complex is predicted to generate 2,500 employment. The new factory is anticipated to begin producing in 2024.
The company began producing solar panels in Georgia in 2019 and swiftly rose to become one of the country's largest producers; by the end of 2022, it was producing 12,000 panels per day. The business claimed that the new complex would boost daily production to 60,000 panels.
Georgia's Democratic Senator Jon Ossoff and Republican Governor Brian Kemp have aggressively courted renewable energy, battery, and automotive companies. South Korea has made several of these investments, including a planned electric vehicle plant by Hyundai.
Mr. Ossoff introduced the Solar Energy Manufacturing for America Act in 2021, which would have provided tax breaks to solar manufacturers. The legislation was eventually incorporated into the Inflation Reduction Act.
These and other provisions are designed to reduce reliance on China, which controls the supply chain for critical raw materials and components for batteries and solar panels. In addition to concerns that the United States was losing ground in critical technologies, lawmakers have expressed concern that some Chinese manufacturers were using forced labor.
Both parties' legislators and administrations have long sought to boost the domestic solar manufacturing industry, including by imposing tariffs and other restrictions on imported solar panels. However, such efforts have yielded only modest results thus far. The majority of solar panels used in the United States are imported.
The Qcells project and others could reduce the United States' reliance on imports, but not immediately. China and other Asian countries have a significant head start in assembling panels and manufacturing the components that go into them. Subsidies, energy policy, trade agreements, and other strategies have also been used by governments in those countries to assist domestic producers.
Several other solar companies, including CubicPV, a start-up backed by Bill Gates, have announced new manufacturing plants in the United States in recent months.
First Solar, another company, announced in August that it would build its fourth panel manufacturing plant in the United States. First Solar intends to invest $1.2 billion in expanding its operations and creating 1,000 new jobs.
CC:Ivan penn and NY times