At first blush, the resumption of solar-cell manufacturing in the United States during the third quarter last year doesn’t sound like a big deal.

But when you shine a little light on it and take a closer look, it means more U.S.-manufactured parts are getting put into solar arrays. And when enough of an array’s parts say “American made” on them, savings can be realized that make it worthwhile to move away from foreign-based manufacturing.

The solar cell, a photovoltaic cell most commonly made of silicon semiconductor material, is the building block of the solar panel or module, which is a collection of connected solar cells. And in 2019 the manufacturing of silicon solar cells in the United States stopped. From a financial standpoint, it made more sense to leave that to foreign countries, China chief among them. And it stayed that way for five years.

“You know, the thinking was that if we can get solar panels made cheaply overseas, we should just think about the lowest cost possible for the electricity consumer. And so that’s the best deal, and let’s do that,” said Mike Kruger, executive director of the Colorado Solar and Storage Association, based in Denver. “As you do that, though, that meant that higher-cost manufacturing in the U.S. couldn’t compete. Those manufacturers either shut down completely or moved offshore.”

Atlasta Solar Center co-owner Lou Villaire said once China was able to ramp up manufacturing of solar cells, there was no competing with it.

“The statistic,” Villaire said, “is that every time the world has doubled manufacturing capacity of modules, prices are pushed down about 10 to 20 percent. And that’s held pretty strong.”

What changed after five years of letting foreign countries make all of the silicon solar cells? Primarily, the Inflation Reduction Act of 2022 provided tax incentives that level the playing field for U.S. manufacturers.

And the solar industry has responded across the nation since then, leading to the Q3 2024 revival of solar-cell manufacturing. That, the Solar Energy Industries Association said in a December report, marked “a pivotal moment for America’s surging solar manufacturing sector.”

Addressing the Inflation Reduction Act, Villaire said, “There are many, many manufacturing incentives in that piece of legislation, the battery manufacturing, U.S. solar-panel manufacturing, and things related to renewables, hydrogen, lots of different incentives.”

Demand also is bolstered by other incentives in Colorado that kick in when a solar installer can show at least 40 percent of the materials used in a project are made in America.

“If we can document a certain amount of domestic production of the products that we’re installing, then there’s an added 10 percent tax credit to the customer,” Villaire said. “U.S.-manufactured solar panels, inverters and racking, those are the three main components, all three of those components are now being manufactured to a large extent in the U.S., reshored sometimes.

“The domestic-content requirement and the domestic-manufacturing requirement has resulted in billions of dollars of investment in the U.S. to manufacture these products here. That’s a good thing.”

Incentives also are making solar arrays more affordable. American-made parts may cost more than foreign parts initially, but they become competitive and sometimes less expensive overall than the foreign parts. Villaire gave the example of South Korea solar manufacturer Qcells, which is a brand of solar panels Atlasta Solar keeps in stock. Qcells opened a manufacturing plant in Georgia and is one of the largest manufacturers of solar cells in the U.S.

“The manufacturing in the U.S. right now, as I understand it, is if you manufacture like Qcells does in the U.S., they can produce them for slightly lower than, say, manufacturing them in South Korea or even China, because of shipping and tariffs and all that kind of stuff,” Villaire said.

That, according to John McClain of SolarWorksGJ, is a difference maker for U.S. customers, who tend to make decisions based on bottom-line cost.

“To meet those demands to get that extra benefit in cost definitely helps the end user for sure, beyond a 30 percent federal tax rebate that’s currently existing,” McClain said.

Villaire thinks demand for American-made solar cells may be outstripping supply right now, but the U.S. is getting serious about solar manufacturing and providing the supply.

In addition to Qcells investment in a Georgia factory, other solar-cell manufacturers have set up shop in California, Florida, Texas and Ohio to name a few.

“The United States is stepping up to take market share from foreign competitors and making sure that the jobs and economic growth from solar are benefiting American communities,” SEIA President and CEO Abigail Ross Hopper said in a December news release from SEIA.

Kruger said growing access to American-made solar panels is a big deal for the solar industry.

“We’ll have panels that we know we can get and a timeline that we can get them,” Kruger said. “Demand has continued to be very strong from residential up through large scale, predominantly the larger projects right now.”

Colorado stood to join the contingent of states adding silicon solar-cell manufacturing when Swiss company Meyer Burger Technology committed in late-July 2023 to build a factory near Colorado Springs, starting in the fourth quarter of 2024. However, Meyer Burger announced in late August 2024 that it canceled its plans for an approximately $400 million plant that would have employed approximately 380 people.

Interest has re-emerged for a factory near Colorado Springs, but Kruger said a lot will depend on the cost to build it. And if someone does build it, they need certainty the market will remain strong for the product.

The latter is in limbo now that President Donald Trump has returned to the White House with a promise to levy tariffs on foreign trade partners. Pundits are uncertain about what effects tariffs ultimately will have, and the solar industry has to play wait-and-see. Trump also could end the Inflation Reduction Act tax credits.

The SEIA’s Ross Harper remained hopeful Trump will acknowledge the giant role solar can play in America’s energy future. In a statement she released upon Trump’s inauguration on Jan. 20, she said in part:

“Under President Trump’s first term, the solar industry grew by an astounding 128 percent. We’re ready to work with the new administration and Congress to continue the buildout of solar and storage, including the ongoing surge in domestic manufacturing that is reducing our reliance on foreign countries and supporting American workers.”

Villaire also voiced some optimism regarding the future growth of U.S. solar-cell manufacturing.

“The way the political winds are, things may shift some, we don’t know exactly,” he said. “But as far as the manufacturing goes, we do feel pretty confident that that will continue.”

MAKE IT AMERICAN-MADE

Atlasta Solar Center co-owner Lou Villaire said Atlasta will soon begin a large project for the City of Grand Junction, installing a large, commercial array on the roof of City Hall.

“One of the requests that was made on the part of at least a couple of the city council members was that we would use as much U.S. product as we can,” Villaire said. “And in fact, the racking, the inverters and the modules are manufactured in the U.S.”