First Solar to build a new solar panel plant in Ohio


WASHINGTON — America’s largest solar panel maker is expected to announce Wednesday plans to invest $ 680 million in a new Ohio plant, in one of the biggest bets on home solar manufacturing since China began to dominate the industry ten years ago.

First solar Inc.,

FSLR 3.07%

based in Tempe, Ariz., said he plans to begin construction once the necessary permits and local incentives have been obtained and that he aims to open the plant in early 2023.

The plant near Toledo, said to be the company’s third in Ohio, is expected to initially produce enough solar panels to produce 3 gigawatts of electricity per year – enough to power about 570,000 homes.

Combined, the three plants would produce panels by 2025 that could generate 6 gigawatts of electricity per year, just over half of all solar panels the company estimates to be produced in the United States each year by. there, said Mark Widmar, chief executive of the company. .

Mr Widmar said the investment reflected the growth of the US market and what he saw as the government’s bipartisan commitment to encourage domestic manufacturing of alternative energies.

First Solar is the largest American manufacturer of solar panels.


Photo:

Dustin Franz for the Wall Street Journal

The pandemic has heightened concerns about “over-reliance on a single country” for imports in industries deemed essential, Widmar said.

President Biden has said he wants to make America’s electricity grid carbon-free by 2035 and will seek to boost domestic industry through the purchase of equipment made in America by the federal government.

“The administration is committed to meeting its ambitious US purchasing goals and creating products made in the United States, including for solar technologies,” a spokesperson for the Office of Management and Budget said. of the White House.

The Department of Energy said the investments are “the perfect embodiment of President Biden’s strategy to develop national manufacturing and supply chains for critical industries.” “

Chinese companies dominated the solar market since around 2011, knocking out American, European and Asian competitors who were ahead of the game but lacked the large-scale government support and funding provided by Beijing and Chinese local governments.

The fierce Chinese competition has lowered the prices of solar panels and made solar energy competitive with natural gas. Some economists say this has been a boon to consumers.

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“It seems to be the solar power makers against the people,” said Nicholas Bloom, an economist at Stanford University.

First Solar, one of the few solar companies in America that can stay afloat, specializes in building panels for large-scale installations in the desert. Chinese companies and others have also built panels for the residential market.

Certain environmental groups opposed megaprojects, saying they are harming the ecology of the desert.

If properly planned, projects can help preserve desert animal life, Widmar said. “Wildlife is emerging around them,” he said. “They can be a safe haven.”

First Solar has recorded losses in five of the past 10 years, but has been profitable since 2020.

First Solar expects its factories in Ohio, including that in Walbridge, to produce panels that could generate 6 gigawatts of electricity per year by 2025.


Photo:

Dustin Franz for the Wall Street Journal

The new, highly automated factory is expected to employ 500 people. Currently, First Solar employs approximately 1,600 people in the United States and 5,000 worldwide.

Despite this, First Solar would remain a relatively small player in the expanding US market, where imports account for an 85% share, according to energy consulting firm Wood Mackenzie.

After the construction of the new First Solar factory, the company would still import 40% of its panels from its factories in Vietnam and Malaysia.

Mr Widmar said the company wants to continue expanding US production, which helps it save on transportation costs and strengthen the company’s position as an alternative to Chinese imports.

“We are the only ones resisting the onslaught of the Chinese,” Widmar said. “A lot of people doubt that we are tough; that’s the challenge.

The company relies on continued support from the United States through tax breaks and possibly the renewal of tariffs on imported Chinese panels, as well as growing domestic demand.

Solar power generation has grown to about 4.3% of the country’s electricity supply, from 0.1% in 2010, according to Scott Sklar, an energy expert at George Washington University.

Shares of First Solar rose 1.3% Tuesday morning to $ 75.96. Shares are down about 25% this year.

Investors have invested more money than ever in renewables such as solar and wind. The WSJ examines how the pandemic, falling energy costs and global politics have driven the rally – and if it can last. (Video of 12/31/20)

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Write to Bob Davis at [email protected]

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