The New York Times' report by Ivan Pan on April 25, 2024
A plant in Moses Lake, Washington, was shut down in 2019 and will soon resume shipping a key ingredient used in most solar panels.
The plant, which is owned by REC Silicon, will help meet the long-term goal of many U.S. lawmakers and energy executives to rebuild a complete domestic solar panel supply chain and reduce global reliance on factories in China and Southeast Asia.
REC Silicon reopened the plant in November in partnership with Hanwha Qcells, a South Korean company that is investing billions of dollars in U.S. solar panel production, in November to produce polysilicon, the base material for the vast majority of solar panels. As part of the deal, Hanwha said this month that it has become the largest shareholder of Norway-based REC Silicon.
Executives at both companies said they were reopening factories in part because President Biden's signed climate law, the Inflation Reduction Act, encouraged domestic production. They expressed hope that their decision would also encourage other companies to resume production of technology created by the United States about 70 years ago.
Kurt Levins, CEO of RECSilicon, said: "Overall, the U.S. is in the first place. People forget about that. You need more battery manufacturing plants outside of China."
Factories in China and Southeast Asia produce more than 95% of solar panels using polysilicon, as well as most of the components for these devices. Chinese manufacturers occupy such an important position that most manufacturers in the United States have stopped producing polysilicon, including REC Silicon.
Industry executives say the Chinese government's tariffs on solar imports, as well as the massive amount of funding and other support it has provided to domestic manufacturers over the years, have made it difficult for companies elsewhere to compete. A smaller REC Silicon plant in Bout, Montana, and two other large companies, Hemlock and Wacker, still produce polysilicon in the United States, but their products are mainly used for semiconductor chips.
The Biden administration has used the Inflation Reduction Act and other policies to try to revive the U.S. solar manufacturing industry. This has spurred the production of more solar panels and other renewable energy products.
But recently, the government's efforts have been undermined by a sharp increase in China's production of solar panels and their modules, as well as a sharp drop in the prices of these products. That's a good thing for buyers of solar panels, like energy companies that are building solar farms, but it's hurting U.S. manufacturers.
Michael Carr, executive director of the Alliance of American Solar Manufacturers, a trade group, said: "Various trade actions, oversupply, dumping have basically made polysilicon exports almost impossible. "The polysilicon industry has really had a tough time.
The U.S. Solar Manufacturers Alliance Trade Council, a group of solar manufacturers that includes Qcells and REC Silicon, filed a complaint with the U.S. International Trade Commission and the U.S. Department of Commerce on Wednesday to investigate possible illegal trade practices in Cambodia, Malaysia, Thailand and Vietnam and impose higher tariffs on their exports to the United States. The complaint focused on companies based in China.
In addition to the allegations in the petition, solar manufacturers have raised concerns about the use of forced labor in polysilicon production in China and other Southeast Asian countries, which the companies say helps suppliers sell their products at low prices. Many companies in the solar industry have pledged to avoid producing products that rely on forced labor, but the origin of the panels and their components can be difficult to trace and verify.
The only U.S. solar manufacturer that has been able to maintain a healthy market share is FirstSolar, which makes thin-film panels that don't use polysilicon.
Yogi Goswami, a professor of engineering at the University of South Florida and editor-in-chief of Solar Compass, a journal of the International Solar Alliance, said researchers and companies are developing other technologies, but the polycrystalline silicon panels born at Bell Labs in 1954 remain "the backbone of silicon solar cells." "Innovators in the U.S. have discovered things that others didn't know they could do."
Qcells said it will use 100% of the polysilicon produced by REC Silicon in Moses Lake, with plans to sell solar panels produced entirely in the United States. The company manufactures solar panels in Georgia and announced in January 2023 that it would invest $2.5 billion to expand its operations in the state.
REC Silicon processes silicon into polysilicon, a granular substance similar to black peppercorn. When the company delivers the product later in the quarter, Qcells will turn the pellets into ingots, which will then be cut into solar wafers and assembled into solar panels to be installed on rooftops or open lots.
REC Silicon chief executive officer Mr Levins said the company began accelerated operations in November, employing about 200 people and expanding its facilities. The 200-acre facility is located in Moses Lake, an industrial and agricultural town in central Washington state.
Danielle Merfeld, Global CTO at Qcells, said: "This is a cleaner and less risky option, and finally achieving domestic production is a practical solution in the long term. We represent only a small fraction of the domestic opportunity. This will not only give confidence to policymakers, but also to other solar manufacturers. There is still a lot of room for solar capacity growth in the country."
Chuck Sutton, vice president of global sales and marketing at REC Silicon, said he never gave up on the plant, which began production in 1984. "Over the past few years, my focus has been on finding opportunities to restart the plant," he says. We've been trying to keep it afloat."
During this week's tour of the factory, dozens of boxes full of polysilicon particles could be seen on the ground, ready to be shipped. REC Silicon executives said they hope this is just the beginning of a new round of growth for the plant: The company owns another 260 acres of land, which they say could be used to expand operations.
Executives said they will look for opportunities to offer products to more customers like Qcells who are interested in producing ingots and wafers in the United States. Mr. Levens said the government may need to provide more incentives for investment in manufacturing.
"It's very important as a country to be able to maximize the opportunities presented by the Inflation Reduction Act," he said. Maybe further straps and slings are needed on how to do this."