Onshoring Solar Production and Supply Chains

‘Reshoring’ became the buzz word in 2012, when companies began rethinking real manufacturing costs. The term was embraced by companies and government alike as they sought to reverse the offshoring trend from the 90’s that proved harmful, particularly to the Industrial Midwest, and to U.S. competitiveness as whole. 

Recently, we entered a new era – the ‘onshoring’ era – in which companies and policymakers are working together to bring new technology and advanced manufacturing to the US for the first time. A great example is what’s happening in the U.S. solar market. 

In standing up new, American-based manufacturing facilities, American companies are enabling the United States to reverse-transfer solar manufacturing capability and technical know-how that it ceded long ago to China. 

Onshoring the complete solar supply chain will of course take time, which is why companies are partnering with leading global solar panel manufacturers. For next-generation U.S. solar manufacturers to catch up to China, they must be able to license best-in-class technology and learn from it. This is only possible when American companies can work with firms that have the technical knowledge and capabilities to manufacture most of the solar supply chain.

The first facilities in the solar supply chain that can be reshored are panel manufacturers. The next upstream step in the manufacturing process, like solar cells, will take more time. That means domestic panel manufacturers will need to import cells until adequate domestic capacity can be built and available. 

There’s tremendous momentum behind onshoring and establishing American solar leadership, but success is not guaranteed. There are some who want to make it harder for the U.S. to build out its own supply chain by prematurely cutting off global suppliers – via tariffs – before a domestic supply chain exists. Doing so would be a mistake because it would slow down job creation, stifle solar energy deployment, discourage innovation, drive up costs, and ensure that America’s solar industry will continue to lag behind China’s technologically. 

Perhaps most importantly, cutting off global suppliers before a domestic supply chain exists would impact American workers and our economy. That’s because competition within the solar manufacturing industry means more quality local jobs, higher wages, and better benefits. New data by the American Council on Renewable Energy found that newly proposed tariffs on solar cells (none of which are made in the USA, by the way) would threaten roughly 9,000 U.S. module factory jobs.

Even more advanced manufacturing careers are coming with microchip manufacturers and auto industry advancements. Solar is leading the charge to upskill local workforces while onshoring parts of the supply chain. A domestic supply chain will benefit not only solar manufacturing, but numerous other industries and communities that are eager to contribute to the resurgence in American innovation.

We’ve made remarkable progress in just a few short years, and we need to get this right because the stakes are high. Demand for low-cost, secure, and lower carbon power is only increasing. We need more domestic clean energy investments, not less, if we’re going to reach our clean energy and climate goals.

“Made in the USA” is every domestic manufacturer’s goal, but doesn’t happen overnight. Our government should be encouraging companies to bring solar expertise and supply chain back to America, not putting up roadblocks to protect companies that have had decades to accomplish what new entrants must scramble to achieve. I hope to look back on this time as the start of a golden age in clean energy advancement and innovation as we bolster both small town and national economies, and accelerate the delivery of cleaner, more reliable, affordable energy.

Kelly Speakes-Backman, is Executive Vice President of Public Affairs at Invenergy, which, through a joint venture called Illuminate USA, opened a solar manufacturing facility in Ohio that uses the latest technology to efficiently produce ready-to-install bifacial solar panels for the world.

Invenergy  |  www.Invenergy.com