Despite the generous tax breaks they are receiving from the Biden administration, many US companies planning to build solar factories can expect to suffer severely or fail altogether, according to an analysis by BloombergNEF.
The Inflation Reduction Act gives US manufacturers an “uncannily equal” subsidy to the cost of Chinese products, but limited availability of cheaper materials from Southeast Asia will pressure American companies, some to the point their plants won’t get built, solar analyst Pol Lezcano says in a report released Monday.
“I wouldn’t have a good night’s sleep if I was the supply chain manager for those factories,” Lezcano said in an interview.
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Solar companies have announced almost 50 gigawatts of annual module assembly capacity in the US, 14 gigawatts of cells, 15 gigawatts of wafers and about six gigawatts of polysilicon, according to the report.
Analysts said they remain skeptical on the success of new US polysilicon and cell capacity. Polysilicon factories take at least two years to build and would require upfront investments of about $250 million per gigawatt, BloombergNEF, Bloomberg’s primary research service, estimates.
