Monday, August 8 2022 Sign In   |    Register
 

News Quick Search


 

News


Front Page
Power News
Today's News
Yesterday's News
Week of Aug 08
Week of Aug 01
Week of Jul 25
Week of Jul 18
Week of Jul 11
By Topic
By News Partner
Gas News
News Customization
Feedback

 

Pro Plus(+)


Add on products to your professional subscription.
  • Energy Archive News
  •  



    Home > News > Power News > News Article

    Share by Email E-mail Printer Friendly Print

    San Antonio solar panel manufacturer says U.S. must do more to compete with China


    June 23, 2022 - Diego Mendoza-Moyers, San Antonio Express-News

     

      Jun. 23—For nearly a decade, Mission Solar Energy has been swimming against an Asian tide. The company, which produces solar systems predominantly for homes at its manufacturing plant on the South Side, is among the few solar panel manufacturers based in the U.S.

      That's something President Joe Biden is trying to change.

      The Biden administration has pushed recently to boost domestic production of solar panels as the U.S. races to generate more clean electricity and reduce dependence on fossil fuels. And while the effort will likely fall short of completely overtaking Asian-based players, for U.S. manufacturers like Mission Solar who have long been unable to compete with global factories, it's a start.

      In February, Auxin Solar, a small solar panel manufacturer based in San Jose, Calif., filed a petition with the U.S. Department of Commerce that claimed solar panels imported from Thailand, Vietnam, Cambodia and Malaysia — markets that account for more than 80 percent of U.S. solar imports — are actually made in China and assembled in those nations to illegally circumvent tariffs on Chinese goods. The Obama administration placed tariffs on Chinese solar technology over 10 years ago.

      Since the Commerce Department began investigating Auxin's claim, solar panel makers in those four nations stopped shipping panels to the U.S. for fear they may face a tariff that would significantly raise costs.

      Biden this month invoked the Defense Production Act to marshal resources for solar panel production stateside. Meanwhile, to satisfy the other side of the industry — solar installers and utilities looking for the lowest-cost panels available — Biden announced a two-year freeze on tariffs on solar imports from Southeast Asia, a move meant to enable projects in the pipeline to continue without the financial burden of added tariffs.

      Biden's two-pronged announcement "gives businesses certainty to accelerate projects delayed by the Department of Commerce's anti-circumvention investigation," the Solar Energy Industries Association said in a statement. "Without this action, massive project delays and cancellations would have continued throughout 2022."

      Can't compete

      Faced for years with competing against less expensive imported solar panels, Mission Solar had to lay off nearly 90 workers in late 2016 and consolidate its operations. Mission Solar would no longer build its own solar cells, the small black squares needed to assemble solar panels. Instead, Mission Solar scrapped its cell production line and began buying them from China.

      Today, Mission Solar sources most of its components and raw materials from Asian countries such as Taiwan and Vietnam. Rows of solar glass shipped from Malaysia sit stacked in the storage room at Mission's plant.

      In many ways, Mission Solar reflects the underdog nature of U.S. solar manufacturers. It controls about 7 percent of the U.S. residential solar market. And Mission executives say openly: American-made panels cost more than imports.

      A Mission Solar home system costs about $1,000 more than those that use imported solar technology, said Paul Mutchler, director of operations for Mission Solar. A home solar panel system costs about $30,000.

      "We know we cannot compete on price," he said. "So we compete on quality, pride and American workmanship."

      It's widely known that Chinese companies evade U.S. tariffs by sending solar equipment to facilities in nearby countries to assemble and export, he said.

      "It's not a secret," Mutchler said. "A lot of people in the U.S. trying to get the advent of green energy and cheap electricity, they know what's going on."

      Auxin's petition has forced Biden to balance competing priorities: quickly shifting from fossil fuels toward cleaner energy sources versus having unionized workers build more goods in the U.S.

      Also, the U.S. originally banned solar exports from China in part because much of the polysilicon — a key raw material for solar panels — used comes from Xinjiang, where the U.S. has accused China of genocide and forced labor of the Uyghur ethnic group.

      "We think we're on the same playing field, and we're really not. We have investors that need to get their money back, and the (Chinese) government, they're patient," Mutchler said.

      Costs for things such as real estate, capital investment, equipment, labor and health insurance are "drastically different" for U.S. makers trying to compete with their Chinese counterparts, he said.

      "They're selling for less than I can buy the material for," he said. "And they have a completed product."

      Winners and losers

      Auxin's CEO and some Republican officials criticized Biden's decision to freeze tariffs on solar imports from the four Southeast Asian nations for two years, arguing that the administration is allowing China to break U.S. trade laws by circumventing tariffs.

      City-owned CPS Energy said the two-year suspension on solar tariffs will help the utility get new contracts with solar farms across the finish line.

      CPS in May signed a deal to buy power from a 300-megawatt solar farm to be built in Goliad County by 2024 or 2025. That was the first tranche of 900 megawatts of solar generation CPS has been planning to add for over a year.

      "Tariffs were certainly holding up some of our other potential partners on the remainder of the 600 megawatts because they were hearing the president might provide a moratorium, but they didn't want to commit to a price and then that not happen, and the price point changes," Garza said. Tariffs "could've impacted the contract price significantly, and those third parties would've been under water on our contract."

      With Biden's move giving CPS another two years, Garza said the utility is getting deals done.

      "Since the president has come out with that decision, the pace of moving forward has certainly changed," he said. "I'm hopeful that we'll get the remainder of the 600 megawatts under contract between now and the end of this year."

      Mutchler with Mission Solar said the suspension of tariffs took the teeth out of the Commerce Department's investigation. But at the same time, he said it's unreasonable to expect the that U.S. can ever build a supply chain for solar technology that rivals China's. For example, there aren't many U.S. producers of the type of low-iron glass that best transmits light for solar panels, he said.

      Mutchler said he supports the Solar Energy Manufacturing Act, a provision tucked into Biden's broader Build Back Better agenda that's been mired in Congress. It would give manufacturers like Mission Solar a tax credit based on how many solar modules they produce.

      And the separate COMPETES Act would provide low-interest loans and grants to finance solar component manufacturing.

      "We definitely need a bridge to a long-term industrial policy or some tax policy," Mutchler said. "Is it about the sale of the project now, or is it truly about green energy? Because I've seen some factories (in China), and they are not too green. And we already know about the Xinjiang region, where they have forced labor."

      "If we have this industrial policy, I think the U.S. will be just fine," he said. "It's the only way we're going to compete if we want to be green."

      diego.mendoza-moyers@express-news.net

      ___

      (c)2022 the San Antonio Express-News

      Visit the San Antonio Express-News at www.mysanantonio.com

      Distributed by Tribune Content Agency, LLC.

    TOP

    Other Articles - International


    TOP

       Home  -  Feedback  -  Contact Us  -  Safe Sender  -  About Energy Central   
    Copyright © 1996-2022 by CyberTech, Inc. All rights reserved.
    Energy Central® and Energy Central Professional® are registered trademarks of CyberTech, Incorporated. Data and information is provided for informational purposes only, and is not intended for trading purposes. CyberTech does not warrant that the information or services of Energy Central will meet any specific requirements; nor will it be error free or uninterrupted; nor shall CyberTech be liable for any indirect, incidental or consequential damages (including lost data, information or profits) sustained or incurred in connection with the use of, operation of, or inability to use Energy Central. Other terms of use may apply. Membership information is confidential and subject to our privacy agreement.