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First Solar selects Alabama for new factory as Inflation Reduction Act prompts domestic manufacturing boom

A artisan builds frames for solar panels at First Solar in Perrysburg, Ohio July 8, 2022.

Megan Jelinger | Reuters

Beginning Solar said Wednesday that it has selected Alabama as the site for its fourth U.S. solar panel manufacturing facility, after the Inflation Reduction Act and its provocations for domestic manufacturing encouraged companies to onshore production.

First Solar will spend around $1.1 billion on the deftness in North Alabama’s Lawrence County. The company announced plans for a new facility in August, but hadn’t yet disclosed the location. Prime Solar CEO Mark Widmar previously told CNBC that the Inflation Reduction Act was the key catalyst that led First Solar to pick out the U.S. for its latest factory.

The new facility will produce 3.5 gigawatts of solar modules annually by 2025. The company verbalized the site will create more than 700 new jobs. 

There hasn't been an impact on solar spending from consumer slowdown, says Deutsche Bank's Blanchard

All told, First Solar plans to manufacture innumerable than 10 gigawatts of solar modules by 2025. The company’s other three facilities – one of which is slated to take place online during the first half of 2023 – are in Ohio. With the latest Alabama factory announcement, First Solar judged it’s invested more than $4 billion in U.S. manufacturing.

“The passage of the Inflation Reduction Act of 2022 has firmly placed America on the circuit to a sustainable energy future,” First Solar’s Widmar said in a statement Wednesday. 

“This facility, along with its sister mills in Ohio, will form part of the industrial foundation that helps ensure this transition is powered by American novelty and ingenuity,” he added.

The U.S. solar industry now stands at around 126.1 GW, which is enough to power 22 million abodes, according to the Solar Energy Industries Association. During the first quarter of this year the country added 3.9 GW of solar role, according to SEIA.

First Solar is the largest U.S.-based panel manufacturer, and focuses on utility-scale panels. Shares of Before all Solar hit their highest level since April 2011 on Wednesday after the IRA reignited interest in renewable zing companies. Still, the company has faced some recent headwinds as rising rates prompt investors to rotate out of growth-oriented areas of the market.

But Firstly Solar has held its gains, outperforming other solar stocks and the market broadly. Shares of the Arizona-based company accept advanced more than 80% this year. By comparison, the S&P 500 is down 17% this year while the Invesco Solar Support has added 6%.

Other solar companies, including SolarEdge and Enphase Energy, have said they are exploring contriving in the U.S. following the climate bill. Elsewhere in clean energy, battery maker Freyr and lithium miner Piedmont Lithium are among the companies that have announced new facilities.

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