The industry is already in a panic. A recent report by the Solar Energy Industry Association found that 83% of U.S. companies surveyed using or buying solar panels are expecting cancellations or delays. And some CEOs are worried that the research could cause the industry to collapse – not surprising given how much the US relies on these countries for solar panel materials.
Indeed, about 80% of all solar panels installed in the US are imported from Cambodia, Malaysia, Thailand and Vietnam. This dependence on other countries leaves the US vulnerable to ongoing global supply disruptions to a commodity that can help accelerate the US transition to a clean energy economy.
Solar energy is the fastest growing energy source in the United States and probably the nation’s best hope for achieving its climate goals. By reducing demand for fossil fuels, solar energy can help boost the economy by providing a stable source of energy from the sun instead of being subject to drilling restrictions, rapidly rising fossil fuel prices and imports from non-participating governments. US values.
A recent report by the US Department of Energy found that solar energy has the potential to supply up to 40% of the country’s electricity by 2035. And according to Secretary of Energy Jennifer M. Granholm, “… Solar energy “The cheapest and fastest growing source of clean energy could generate enough electricity to power all US homes by 2035 and employ up to 1.5 million people in the process.” Access to solar energy is especially important for low-income families who are less able to afford rising home energy prices and are less likely to have generators or other backup systems when the power goes out.
To achieve the country’s clean energy goals, the United States must develop a strong manufacturing capability to produce solar panels and components. It can do this by providing financial incentives to US manufacturers to help offset the higher cost of domestic production, which is estimated to be 30% to 40% higher than imports.
Congress is already moving in that direction. For example, the bill passed by House Build Back Better will extend and extend investment tax credit and production tax credit to encourage the production of solar panels. Tax deductions should reduce overall production costs, increase production efficiency, build capacity and provide ongoing production assistance.
These are important because they signal a long-term commitment to US solar development and manufacturing. And they give solar investors the confidence they need to fund solar panel plants. In addition, the Commerce Department should move quickly to complete its research to give the solar industry industry certainty about import pricing until Congress agrees on a longer-term solution.
Congress still has time to act, but it is short. Lawmakers must agree to vote on tax deductions before the end of the session. The nation’s clean energy goals hang in the balance.