First Solar will consider US manufacturing buildout if climate bill passes

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A PV production plant from First Solar. Image: First Solar.

Thin-film module manufacturer First Solar will consider expanding its production footprint in the US if proposed legislation that includes manufacturing credits becomes law, the company’s CEO has said.

Arizona-headquartered First Solar had previously revealed it was evaluating the potential for future capacity expansions in the US, but said it first required clarity on domestic solar policy.

On Wednesday key senator Joe Manchin announced he had struck a deal to vote on legislation dubbed the Inflation Reduction Act 2022, which features a host of manufacturing credits for solar equipment.

“In light of these latest developments, and should the Inflation Reduction Act get passed with consistent language on solar-related tax credits, we plan to pivot quickly to reevaluate US manufacturing expansion,” Mark Widmar, CEO at First Solar, said during a conference call with analysts.

Management is hopeful that an advanced manufacturing production credit, if passed, “helps deliver the incentives required to boost domestic solar manufacturing and secure our nation’s energy independence”, he added.  

First Solar is investing US$680 million to set up a 3.3GWdc solar module manufacturing plant in Ohio – the company’s third factory in the state – that remains on schedule and is expected to be commissioned in the first half of 2023.

The company also operates factories in Vietnam and Malaysia and is setting up a 3.3GW plant in India that is on track to be commissioned in the second half of 2023.

Having seen strong demand from domestic developers and foreign-owned independent power producers in India, First Solar anticipates entering into the first contracts for the output of the new factory in the coming months, according to Widmar.

“Similarly in Europe, we are seeing growing demand where geopolitics and the war in Ukraine have led to an urgent effort to deploy more renewables as the EU works to diversify its energy portfolio,” Widmar said during the call.

First Solar posted net sales of US$621 million during Q2 2022, slightly down on the US$629 million recorded in the same quarter last year.

Operating income was US$145 million, compared to US$110 million in Q2 2022.

Conference call transcript from Seeking Alpha.

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