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Solar Manufacturing Incentives

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The United States continues record-setting growth in renewable energy project construction. A stronger and more competitive U.S. domestic manufacturing base will support more robust job creation and economic growth. Limited, short-term federal tax incentives like the Section 48C Advanced Energy Manufacturing Tax Credit (“48C”) jump-started recent investments in new domestic plants, as well as expansions of existing facilities. The oversubscribed program lacked sufficient funding to meet company demand, but new legislation could provide the support necessary to spur thousands of new jobs and develop U.S. manufacturing’s global competitiveness.

U.S. Solar Supply Chain Manufacturing Locations

Growing U.S. Manufacturing Base for Solar

  • The solar industry employs more than 29,000 Americans in the manufacturing sector across more than 650 manufacturing facilities in the United States.
  • PV manufacturing facilities in 28 states around the country are producing the primary components of a solar PV system, including solar-grade polysilicon, ingots, wafers, cells, solar modules, and inverters.
  • Glass and steel manufacturers also provide essential components for utility-scale solar power plants, including concentrating solar power (“CSP”) projects currently under construction in the U.S. Southwest.
  • New solar manufacturing facilities opened in 2011 in Arizona, California, Illinois, Kentucky, Michigan, Mississippi, North Carolina, Nevada, New York, Ohio, Pennsylvania, Texas, Vermont, Washington, and Wisconsin.
  • Further solar manufacturing expansion will continue in 2012 and 2013, as major new facilities come online in Arizona, Colorado, Indiana, Massachusetts, Mississippi, North Carolina, Nevada, New York, Ohio, Oregon, Pennsylvania, South Carolina, and Tennessee.

Domestic Manufacturing & American Competitiveness

Smart federal policy that supports solar manufacturing in the United States will grow American jobs throughout the clean energy supply chain and ensure a robust domestic industry that can compete internationally. Countries such as China, Germany, and Malaysia continue to provide stable support to their renewable energy manufacturing sectors, making it very difficult for American companies who are hampered by short-term, inconsistent federal policy.

Advanced Energy Manufacturing Tax Credit

The 2009 American Recovery and Reinvestment Act (ARRA) included a competitive tax credit capped at $2.3 billion in total tax expenditures for advanced energy manufacturing projects (Section 48C). Although 183 separate projects received awards, over 500 applications were submitted, totaling over $8 billion and oversubscribing the program by a ratio of more than 3 to 1. Credits were awarded to facilities located in at least 21 states, including photovoltaicconcentrating solar power, and solar heating & cooling technologies.

SEIA continues to advocate for additional funding for the successful 48C tax credit as well as other manufacturing incentives to increase U.S. domestic manufacturing capacity. Currently, no federal incentives are available to companies trying to build manufacturing facilities in the United States.

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