The United States is taking aim to massively upscale its domestic clean energy manufacturing capabilities, with new action signed by President Joe Biden this week targeting the country’s solar production capacity, as well as green hydrogen and fuel cell production.
Biden’s announcements were headlined by two modifications to the US Defense Production Act – a 1950s era act that gives the President the authority to direct private companies to prioritise orders deemed as being “essential to the national defense”.
For example, in just the last few years the US Defense Production Act has been used to direct private companies to prioritise the production of medical-grade face masks during the worst parts of the COVID-19 pandemic and, more recently, to help baby formula manufacturers scale up production.
This week, the White House added “solar photovoltaic modules and module components, including ingots, wafers, solar glass, and cells” and “electrolyzers, fuel cells, and platinum group metals” listed as “industrial resources, materials, or critical technology items essential to the national defense”.
Biden’s actions are aimed at scaling up the US solar manufacturing capacity from its current level of 7.5GW up to 22.5GW by the end of his first term.
Further supporting the US solar industry are the authorisation of a 24-month bridge for tariff-free import of certain solar products made in select Southeast Asian countries, as well as two new tools designed to utilise the federal government’s procurement capabilities to further spur solar manufacturing capacity.
Solar developers from across the US will be able to source solar PV modules and cells from Cambodia, Malaysia, Thailand, and Vietnam, free of certain duties for 24 months so as to ensure the United States secures access to a sufficient supply of solar products to meet national electricity generation.
Similarly, the Biden administration will implement Master Supply Agreements for domestically manufactured solar systems to increase the speed and efficiency with which domestic clean electricity providers are able to sell their products to the US Government, as well as so-called “Super Preferences” to apply domestic content standards for federal procurement of solar systems.
“These actions will spur domestic manufacturing, construction projects, and good-paying jobs – all while cutting energy costs for families, strengthening our grid, and tackling climate change and environmental injustice,” the White House said.
Unsurprisingly, the news was warmly welcomed by the US solar industry.
“We applaud President Biden’s thoughtful approach to addressing the current crisis of the paralyzed solar supply chain,” said Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association (SEIA), the American trade association for the solar and storage industries.
“The president is providing improved business certainty today while harnessing the power of the Defense Production Act for tomorrow. Today’s actions protect existing solar jobs, will lead to increased employment in the solar industry and foster a robust solar manufacturing base here at home.
“Indeed, growing a robust solar supply chain here in the United States is critical to meeting SEIA’s goal of having solar account for 30% of all electricity by 2030. Today’s announcement is a great step, and enactment of the Solar Energy Manufacturing Act for America will provide an even greater boost.”
