Firms that are already committed to U.S. solar manufacturing see an advantage in being able to pivot quickly to meet market demands.
Just as the U.S. solar market is highly diversified among states and regions, for solar manufacturing in the North America, local is in the eye of the beholder. KACO sees San Antonio as its hub for all of the Americas, and does not see the need for an additional facility in Latin America at this time, although that could change in the future. NEXTracker, on the other hand, expanded its manufacturing presence in in Mexico last year, although it also manufactures in the U.S. With Canada exempt from any decision regarding the trade case, some companies may look to expand manufacturing just north of the U.S. border.
When NEXTracker expanded in Mexico, for instance, it pointed to the benefit of the increased capacity reinforcing its local supply chains. A robust supply chain is one of the reasons that China has been able to push down the cost of module production. GTM Research analysts have argued that the U.S. government could look at ways of subsidizing the supply chain as one way to beef up solar production domestically.
If the government sets high tariffs in the trade case, some local manufacturers should have a leg up in the short term, but for some buyers, the importance of locally made products is already high. Many government contracts, whether local or national, favor locally made components. There are also some homeowners who care where their panels are produced and whether their local installers are working with U.S.-based suppliers.
At the end of the day, however, all of these companies are competing on a combination of price and value — not just the presence of a “Made in USA” sticker. “As the solar market becomes more educated and looks not just at the dollar-per-watt upfront cost, but also the long-term levelized cost of energy, there will be more value in panels that produce more power over a certain amount of time and also last longer,” said Martens.
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