First Solar to invest $1.2 billion in US manufacturing output following new climate law
Tempe-based First Solar, the largest U.S.-based solar panel manufacturer, announced on Tuesday that it would spend up to $1.2 billion to expand its U.S. manufacturing capacity, mainly in Ohio and the Southeast part of the country.
First Solar (Nasdaq: FSLR) said it would spend $1 billion to build a new factory, its fourth, somewhere in the Southeast, but the company would not say which states it is considering. A location decision is expected by the end of September.
The new factory is expected to produce 3.5 gigawatts of photovoltaic solar power annually once production starts in 2025.
Additionally, the company said it would spend $185 million to expand its operations in northeast Ohio facilities by 0.9 GW, which it says is the largest vertically integrated complex of its kind in the Western Hemisphere; The vast majority of the world’s solar panels are produced in Asia.
These Ohio facilities include two existing sites in Perrysburg and Lake Township, which will grow to 3.6 GW capacity, and a new site with 3.5 GW capacity that will be commissioned in the second half of next year.
All told, these new investments are expected to add 850 new jobs and bring First Solar’s production capacity to more than 10 GW by 2025. The company expects to employ 3,000 people directly in the U.S. by 2025 and support an additional 15,000 indirect jobs.
Federal legislation’s effect
First Solar CEO Mark Widmar said that recently passed federal legislation encouraged the company to make such a big investment.
“In passing the Inflation Reduction Act of 2022, Congress and the Biden-Harris Administration has entrusted our industry with the responsibility of enabling America’s clean energy future and we must meet the moment in a manner that is both timely and sustainable,” he said in a statement.
“This investment is an important step towards achieving self-sufficiency in solar technology, which, in turn, supports America’s energy security ambitions, its deployment of solar at scale, and its ability to lead with innovation… We are investing in America’s future.”
The Inflation Reduction Act is a wide-ranging new set of laws that includes $369 billion for climate and energy provisions and incentives for companies to build in the United States. The IRA also made changes to tax law and enforcement, health care costs and more.
Last month, First Solar reported making $621 million in its second quarter ended June 30, up $254 million from the same period last year. The company also reported a massive backlog of orders that exceeds 44 GW, showing enduring demand for PV panels.
First Solar’s stock price is up about 40% year-to-date. Click here to follow the stock.
The company employed 4,800 people globally at the end of 2021. In addition to its U.S. manufacturing sites and corporate office in Tempe, First Solar also has factories in Malaysia and Vietnam.
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