$1.1 Billion U.S. Panel Factory Announced by First Solar, Marking Their Fifth Investment

First Solar Inc., a leader in the American solar panel industry, has revealed plans on Thursday to spend as much as $1.1 billion on its fifth U.S. factory. This impressive investment is aimed at satisfying the skyrocketing demand for American-made solar panels, which is a pivotal part of the country’s shift toward renewable energy.

This marks the second time within the past year that First Solar, the nation’s foremost panel maker, has unveiled a significant expansion of its domestic manufacturing capabilities. The recent growth in solar factory investments is fueled in part by President Joe Biden’s Inflation Reduction Act. Passed last year, the law encourages homegrown production of clean energy equipment, thus supporting America’s sustainability agenda.

First Solar’s Chief Executive, Mark Widmar, highlighted the importance of the expansion in a statement: “By expanding America’s solar manufacturing base, and the value chains that support it, we are working to ensure that the U.S. enters the next decade in a position of strength, fully capable of producing the technology it needs to complete its transition to a sustainable energy future.”

The latest factory, a 3.5-gigawatt (GW) facility, will enhance First Solar’s U.S. manufacturing capacity by a significant 33%, taking the total to 14 GW. The Tempe, Arizona-based company is yet to finalize the location of the new facility, which is expected to begin production in 2026 and create around 700 new jobs. First Solar already has manufacturing operations in Ohio and is set to open a new facility in Alabama in 2025. They also maintain operations overseas in Malaysia and Vietnam.

U.S. solar project developers are increasingly attracted to First Solar’s innovative cadmium telluride products. Unlike the majority of panels that depend on polysilicon – a raw material primarily sourced from China – First Solar’s technology avoids such reliance. This unique approach has contributed to the company’s substantial order backlog of 78 GW.

Under the provisions of the Inflation Reduction Act (IRA), projects that use equipment manufactured in the United States are eligible for a bonus tax credit. This credit is worth 10% of the facility’s cost and is designed to reduce the country’s dependence on Chinese-made products, a significant consideration in the current global economic landscape.

First Solar has committed to producing the Series 7 panels at the new factory entirely with U.S. components, complying with the Treasury Department’s regulations for the IRA tax credits.

The White House expressed its approval of First Solar’s announcement, reinforcing the administration’s commitment to boosting American manufacturing and domestic supply chains. “Today’s announcement by First Solar, a proud American company, represents another huge investment in American manufacturing and building our supply chains here at home – that’s what Bidenomics is all about,” President Biden stated.

This development is indicative of a broader trend in the United States as it moves toward a more self-reliant and sustainable energy economy. The investment in domestic production, technological innovation, and job creation is expected to have a lasting impact on both the energy sector and the nation’s economic resilience.