A federal fund with less than $500 million has already been used to pay for things such as military drones and baby formula. President Joe Biden’s plan to jumpstart domestic solar-panel manufacture is based on that money.
That amount of money, even if it was devoted to solar production, would only be enough to establish a handful of plants that could produce a fraction of what the United States imports each year.
Pro-industry Coalition for a Prosperous America spokesperson Nick Iacovella stated, “Even if they spend all of that money on solar panels, it’s a pittance.
The president’s new solar programs may be unable to receive federal support.
The same pot may also be required to handle other supply shortages and national security reasons.
Congress may expect the administration to ask for more funding. White House spokesman Jay Carney was unavailable for comment.
Using the Cold War-era Defense Production Act, Vice President Joe Biden has taken advantage of extensive authorities to help the United States manufacture a range of essential energy technologies, including solar panels and fuel cells.
Solar cells and modules from four Southeast Asian countries will be granted a two-year exemption from new duties to defuse an ongoing trade conflict.
It’s not just about finance that supporters of the president’s plan stress, they say. In addition, it provides the US Energy Department with new instruments and authority to make manufacturing investments. According to a government expenditure database, defense Production Act purchases might cost the nation $545 million this fiscal year, with $434 million left over.
As a result of Biden’s strategy, domestic producers reacted angrily.
Vice president of policy at First Solar Inc., Samantha Sloan, said the Defense Production Act requirements fell short of the industrial policy required to marshal local industry.
In support of US solar manufacturing, she remarked, “we have yet to see this administration put action behind the word” “That irritates me a little about where my priorities are.”
According to industry estimates and the coalition, a new manufacturing facility with the capacity to produce 1.4 gigawatts of modules each year might cost roughly $170 million.
But, as Iacovella pointed out, that’s not even close to competing with the 24 gigawatts the US imported last year.
As if that weren’t bad enough, new facilities to create polysilicon, a significant component of solar panels, could cost even more. According to BloombergNEF, a new factory that produces 20,000 tons of polysilicon per year would easily cost $1 billion.
Bank of America characterized Biden’s industrial move as “more hyperbole” in a research report Tuesday. Moreover, information from many parties in the industry indicates that it is not a panacea.