For Georgia’s solar manufacturers and installers, the last two years have not been easy.
Trade disputes with foreign producers have constrained the availability of panels. Shifting federal and state policies have roiled the market with uncertainty. And COVID-19 supply chain disruptions have raised prices, delaying some projects and nixing others.
But on Friday, the U.S. House approved the Inflation Reduction Act (IRA), and panel producers and clean energy advocates say few states are better positioned than Georgia to capitalize on the brighter days that may lie ahead for the solar industry.
“This legislation really marks a turning point,” said Scott Moskowitz, the head of market strategy and public affairs at Qcells, whose existing Dalton facility is the largest solar plant in the Western Hemisphere. “It has policies that will help to directly incentivize new investment and create scale that is going to make the U.S. globally competitive.”
The Democrats’ landmark bill aimed at slowing climate change, lowering health care and prescription drug costs, and revamping the corporate tax code now heads to President Joe Biden’s desk.
One of the many challenges the legislation seeks to address is the reliance of the global solar supply chain on China. The country holds more than an 80% share in all of the various materials needed to build solar panels, according to recent analysis by the International Energy Agency.
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The bill contains a raft of incentives — many of which were championed by Georgia Senators Jon Ossoff and Raphael Warnock — aimed at growing domestic solar and clean energy supply chains.
The IRA would provide $10 billion in tax credits for building new solar manufacturing facilities, plus $30 billion for U.S. manufacturers to make components for solar panels, batteries, wind turbines and to process the minerals needed for renewable energy technologies and electric vehicles.
Republicans, including GOP Senate candidate Herschel Walker, have claimed the bill will fuel inflation and hurt Georgia’s economy.
But producers like Georgia’s own Qcells — which recently announced a $171 million expansion near its existing Dalton plant — say they are eyeing even more growth thanks to the legislation.
“It really directly encourages scale and is going to turn the U.S. into a world leader in clean energy manufacturing,” Moskowitz said. “From Qcells’ perspective, we’re currently expanding in Dalton and are also looking at a variety of other growth projects that are made possible by Senator Warnock and Ossoff’s legislation.”
The bill also includes billions aimed at spurring projects big and small to harness more of the sun’s energy.
For homeowners and businesses, the IRA would extend a 30% income tax credit for rooftop solar for 10 years and offer a credit for battery systems that store excess energy when the sun isn’t shining.
For utilities like Georgia Power — which says it has about 3,000 megawatts of solar online today, with plans to increase that by around 200% by 2035 — the legislation offers investment and production tax credits for solar. Companies like it have the potential to unlock even more savings if they use U.S.-made components or build projects that serve low-income communities.
Georgia Power spokesman Jacob Hawkins said the company is continuing to review the legislation.
The bill also allows new payment options for government entities, churches and non-profits to get in on the solar action.
Still, solar advocates say some challenges remain for Georgia’s industry.
Georgia has the 7th-most installed solar capacity in the country, but most of that is from large, utility-scale projects — not smaller systems on the roofs of homes and businesses.
In 2019, the Georgia Public Service Commission (PSC) created a pilot program that allowed property owners with rooftop solar to dramatically lower their energy bills, which spurred a boom in new installations. However, the program was limited to 5,000 participants and has been maxed out since last summer.
A proposal last month by PSC Commissioner Tim Echols to expand the program failed, but commissioners approved a motion to study the impacts of rooftop solar and revisit potential expansion in the future.
Now, with the IRA encouraging solar development, advocates like Don Moreland, the executive director of the Georgia Solar Energy Association, say it’s critical to pair the new federal policy with state level incentives.
“To me, it sends a signal to the state that they also need to step up,” Moreland said.
A note of disclosure
This coverage is supported by a partnership with 1Earth Fund, the Kendeda Fund and Journalism Funding Partners. You can learn more and support our climate reporting by donating at ajc.com/donate/climate/
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