6 clean energy companies that are ramping up US manufacturing

The Inflation Reduction Act provides billions of dollars in tax credits and loans, helping to spur investment in domestic production.
By Shel Evergreen

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A worker in a blue shirt handles a solar panel in a factory

The Inflation Reduction Act dedicates a historic $369 billion to support energy and climate initiatives, such as expanding domestic manufacturing capacity. This includes an estimated $30 billion in production tax credits aimed at accelerating U.S. manufacturing of batteries, solar panels, wind turbines and other clean energy technologies — along with tens of billions more in the form of investment tax credits and loans.

Since the legislation passed in August, a number of companies have announced major initiatives to expand renewable energy manufacturing in the U.S. But how much of that is directly attributable to the Inflation Reduction Act?

It’s hard to point to most of these announcements and say definitively that they hinged on the major legislation package, Harry Godfrey, managing director at trade group Advanced Energy Economy, said. Making a decision around building a new facility or even expanding a facility is not something that happens overnight.”

But, Godfrey added, there was pent-up demand in the renewable energy market, and the Inflation Reduction Act opened the floodgates. It’s increasing the magnitude of dollars and investments going into advanced energy.”

The act, according to Godfrey, will help lower the cost throughout the supply chain, from critical minerals to final product assembly. Before, there wasn’t the pull side of the equation.” Now, alongside the tax breaks, he said, companies know there will be demand from domestic buyers all along the supply chain.

It’s an incredibly optimistic environment. Everyone is kind of bubbling with excitement,” said Michelle Davis, a principal analyst at research firm Wood Mackenzie. The clean energy elements of the now-defunct Build Back Better bill have largely passed in the same form under the Inflation Reduction Act, and the spate of recent announcements are a result of that, she said.

Both Davis and Godfrey believe that more announcements are on the horizon. There are a lot of companies that have intentions of making further investments because of these incentives,” Davis said. I think we’ll be able to look back in a year or two years and say, The IRA catalyzed this much additional development in this many more projects.’”

Here are six companies that have announced plans to ramp up renewable energy manufacturing in the U.S. since the bill was passed.

1. First Solar

In August, First Solar, the largest solar manufacturer in the U.S., announced its plans to greatly expand domestic production. This includes a $1 billion investment in a new 3.5-gigawatt solar module factory in the Southeast, as well as a $185 million upgrade of 0.9 gigawatts to its Ohio factory. All told, the company expects to have a solar panel production capacity of 10 gigawatts per year by 2025.

In passing the Inflation Reduction Act of 2022, Congress and the Biden-Harris Administration [have] 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,” said CEO Mark Widmar, in a statement.

2. Tesla

Electric vehicle manufacturer Tesla may be pumping the brakes on its plans for battery manufacturing in Germany, according to The Wall Street Journal. The company has not made an official announcement but is reportedly discussing moving equipment for battery cell production originally meant for its German factory to the U.S.

The Inflation Reduction Act stipulates that electric vehicles eligible for tax credits must be assembled in North America and have batteries made from components and materials largely sourced from the United States. Batteries from countries with which the U.S. has a trade agreement are also eligible. The law notably excludes battery materials from foreign entities of concern,” potentially including China, which supplies most of the world’s lithium-ion battery cells and processed materials.

The lure of tax credits could drive American buyers to favor automakers that allow them to reap those benefits, which range from $4,000 for used passenger vehicles up to $40,000 for some heavy-duty commercial vehicles. This is a major economic incentive for consumers and companies alike to source batteries from domestic manufacturers.

3. Piedmont Lithium

Lithium mining company Piedmont Lithium announced in September plans to build a processing plant in Tennessee. The facility is expected to produce 30,000 metric tons per year of lithium hydroxide, which is derived from spodumene.

Piedmont Lithium’s Tennessee project has been in the works for several months and was not directly influenced by the recently passed legislation,” CEO Keith Phillips said in an email. That said, Piedmont is encouraged by the goals of the legislation, and we hope it accelerates the country’s transition to EVs, a domestic supply chain and U.S. energy independence.”

4. Qcells North America

Qcells North America is considering sites in north Texas for a 9-gigawatt solar manufacturing facility, according to a filing to the Texas Comptroller’s office from early August. Scott Moskowitz, head of public affairs, said in an email that the company had already been working to implement a multi-phase, multi-billion dollar expansion across the full solar supply chain” pending passage of the Solar Energy Manufacturing for America Act, which was incorporated into the Inflation Reduction Act.

The new facility could produce ingots, wafers, cells, modules and even ethylene vinyl acetate, which is used to laminate solar panels. The filing notes the company is also considering sites in South Carolina and Georgia but has made no concrete decisions.

Qcells already owns what is currently the single largest module manufacturing facility in the U.S., a 1.7-gigawatt plant in Georgia that it plans to expand to 3.1 gigawatts. 

5. Toyota Motor North America

At the end of August, Toyota announced $2.5 billion in additional funding for its North Carolina electric battery facility, almost tripling its initial investment plans. The facility is expected to be capable of producing lithium-ion batteries for 200,000 vehicles beginning in 2025, with the potential to eventually make enough batteries for 1.2 million electric vehicles per year.

This plant will serve a central role in Toyota’s leadership toward a fully electrified future and will help us meet our goal of carbon neutrality in our vehicles and global operations by 2035,” said Norm Bafunno, a senior vice president at the company, in a statement. This particular project was in the works before the Inflation Reduction Act, but the legislation might be a catalyst for our domestic battery production,” Bafunno told The New York Times.

6. Honda and LG Chem

Japanese automaker Honda and Korean chemical company LG Chem announced in August that they are teaming up in a $4.4 billion investment to produce electric vehicle batteries in the U.S.

While it’s unclear if the decision is directly linked to the Inflation Reduction Act legislation, domestic production of batteries is a key requirement to qualify for the bill’s electric vehicle tax credits. The location of the facility has not yet been decided, but the companies aim to begin construction in 2023

Shel Evergreen reports on clean energy as an intern with Canary Media. She’s written for Ars Technica, Source and MIT Technology Review. She’s also a multimedia pro who has been called a “Swiss Army knife” for her versatile skill set in writing, video production, graphic design and more.