Domestic Manufacturing. I got an interesting AMA question about domestic manufacturing, especially with the DC headlines this week about a tax credit for domestic factories. It seems to me that the best thing going for domestic content, cells and modules, is based on supply chain hiccups and cost. I.e. if the local cost of manufacturing can make the product more readily available and absorb the cost of offshore logistics, then more manufacturing will happen here. The best analogy is US made car manufacturing, cheaper to make them here than to offshore the manufacturing and ship the cars.
A Domestic Premium? Can domestic modules, inverters and BOS get a premium for being made in America? I wish I could say yes, but every time I’ve tried to sell the value of domestically made solar products, primarily my experience in racking, the answer was a hard no.
How To Fix. Manufacturing is good work, it has predictable hours, training for new employees and consistent ability to promote from within. The pressure to justify domestic manufacturing is complicated sometimes and in an economy driven by promoting goals through the tax code, here’s my fix for domestic manufacturing of all types. Unlike traditional labor expenses that are deducted from revenue, allow for direct shift labor expense in manufacturing to be a 2x or 3x deduction. That means that a $25 per hour employee which has a $5 tax benefit, would deduct at $16 per hour.
- Energy Storage News: US energy secretary – ‘We need to act now to develop domestic lithium battery capabilities’
- PV-Magazine: SEIA has a ‘strong sense’ that U.S. solar supply chains are shifting, but hard numbers are scarce
- Canary Media: Used EV batteries could get a second life storing clean energy on California’s grid
- Reuters: Falling renewables costs undercut new and some existing coal plants – study
- GreenBiz: GM plans to drive $35 billion into zero-emission vehicles
- Solar Industry: Work Under Way on New Utility-Scale Project in North Carolina
- Utility Dive: US grid needs overhaul to keep up with renewable revolution, says GE exec, Sen. Heinrich
- Axios: Why electrifying the light truck market could be tough
Opinion
Best, Yann