Trina Solar Co, a prominent Chinese photovoltaic or PV panel manufacturer, will further expand its presence in the burgeoning US market by investing more than $200 million in a new facility in Texas, the company said.
The site is expected to start operations in 2024.
The Texas plant will be able to make about 5 gigawatts of PV panels a year using polysilicon sourced from the United States and Europe. The unit is expected to create 1,500 jobs, the company said.
Steven Zhu, president of Trina Solar's US arm, said: "We have long had a vision to manufacture solar products in the US and our goal in building this facility is to begin to create an ecosystem of US manufacturing that can serve the burgeoning US solar market."
Trina already operates a tracker manufacturing plant in Brazil and a wafer production facility in Vietnam that was commissioned earlier this year.
Trina Solar's announcement of its plans for a larger presence in the US was preceded by those of China's other key PV module makers.
In January, JA Solar announced it would invest $60 million in its first US manufacturing facility in Phoenix, Arizona, to produce high-efficiency PV panels for commercial and residential rooftops, as well as utility-scale solar power plants. Once fully operational by the end of this year, it will be the largest PV panel manufacturing site in the state, reaching an annual production capacity of 2 GW, it said.
In March, Longi Solar said it would cooperate with US solar project developer Invenergy to jointly construct a 5 GW solar panel factory in Pataskala, Ohio.
In April, Jinko Solar said it would expand the capacity of its US plant by 1 GW of PV modules. The plant was established in November 2017 and is mainly used for the production and sales of solar modules.
Tan Youru, an analyst from BloombergNEF, said the construction of a facility in the US will likely benefit from the tax incentives offered to companies involved in the establishment of a coherent solar supply chain in the country.
He said manufacturing subsidies for solar components in the Inflation Reduction Act are extremely generous. "Companies have announced over 55 GW of new module factories in the US after the passage of the Inflation Reduction Act. Factories that sell to the US also earn much higher margins there than in the rest of the world, due to trade tariffs."
In August 2022, the US introduced the Inflation Reduction Act to encourage the transition to clean energy domestically by providing substantial and clear incentives, particularly for domestic manufacturing. Among these incentives, the subsidies for PV components are the highest, reaching 7 cents per watt, which represents 20 percent of the current average price of PV components in the US.
China's PV module production capacity accounts for about 80 percent of the world's, and Chinese companies figure in the top nine of the world's Top 10 module suppliers. About half of the products of Chinese component companies are sold overseas, and the US is among the high-profit markets in the world, according to data from the China Solar Association.
On the other hand, demand for PV modules in the US is red-hot. The American Solar Industry Association predicts the country's newly added PV capacity this year will reach a record 32 GW, up 52 percent from 2022.
BloombergNEF estimated that building a PV supply chain in these regions would cost over $500 million for each gigawatt of annual capacity. That is over three times more expensive than in China due to both higher equipment and construction costs.
"Diversifying global PV supply chains will, therefore, come at a substantial cost, though not an unaffordable one in terms of capex (capital expenditure). Most of the cost of making solar panels is the operating expenditure for the factories," said Tan.
（Picture: Veer）
