US solar boom on hold as industry awaits subsidy rules
(Climate Home News, 24 Apr 2023) U.S. President Joe Biden’s plan to challenge China’s dominance in solar panel manufacturing hinges in large part on rules his administration will soon release defining what it means for a product to be American-made, according to industry officials.
The Biden administration’s Inflation Reduction Act is offering billions of dollars in tax incentives for facilities using American equipment to accelerate decarbonization of the U.S. power sector while creating domestic jobs.
But the subsidies, signed into law last year, have yet to trigger a boom in U.S. solar manufacturing as investors await guidance on those perks. Their main question: will solar panels qualify if they are assembled in the United States using components made overseas?
As soon as this month, the U.S. Treasury Department is expected to release those details, the latest in a series of advisories on how companies can take advantage of the landmark law.
The IRA contains a 30% tax credit for renewable energy facilities, with the domestic content bonus worth an additional 10% of the project cost. The IRA contains a number of such bonuses, including for building projects in disadvantaged communities and for adhering to certain labor standards.
Climate Home News, 24 Apr 2023: US solar boom on hold as industry awaits subsidy rules