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THE WEEKLY SUN: The U.S. is Suddenly Awash in Renewable Investments

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September 7, 2022

THIS WEEK IN SOLAR, RENEWABLE AND SUSTAINABLE NEWS.

In this week’s solar news, major investments across the country in renewables, A Green Bank for smaller projects, and Floatovoltaics.


vehicle assembly line

Investments flooding into renewables in the U.S.

In the days before the Inflation Reduction Act (IRA) was signed in August, lawmakers and business leaders predicted a slew of investments in renewables and clean tech would follow on the heels of the legislation.

Few, though, predicted the size and the frequency of the announcements that have come since then. Nearly every day since August 16th, when President Biden signed the law, has witnessed some type of multi-billion dollar commitment to renewable energy generation or manufacturing in the United States.

The electric vehicle (EV) market is probably the biggest beneficiary of the initial investment wave, driven by the law’s requirement for autos to include an increasing percentage of U.S.-made components to qualify for the federal tax credit.

EVs need batteries, and perhaps the biggest splash came from Honda and LG Energy Solutions. The partners committed to a $4.4 billion facility to be located somewhere in the Southeast United States. Although neither a precise location nor anticipated jobs impact was announced, the companies did say that the factory will produce 40 gigawatt-hours annually.

Panasonic Holdings has a similar investment in negotiation, looking to build a $4 billion factory in Oklahoma. The company has not announced the finalized deal as of yet.

Envision broke ground on a $2 billion battery factory in Bowling Green, Kentucky that is expected to employ 2,000 people and make 30 gigawatt-hours of capacity each year.

Toyota joined the hit parade last week, announcing that it was increasing its investment in a Greensboro, N.C. battery plant from $1.3 billion to $3.8 billion.

The U.S. was seeing an uptick in battery production investment even before the law was announced. A long-planned facility in Commerce, Georgia, has recently come online, and many hope it will help ease the backlog of electric F-150s on the market.

The south doesn’t have a stranglehold on the battery market. Tiny Endicott, N.Y., is about to flip the switch on a gigawatt factory later this month, with ambitions to scale to 30 gigawatts by 2030.

The IRA requires essential minerals for EV batteries be mined and processed in the U.S. or its strategic trade partners.

One such partner, Canada, is rich in cobalt, lithium, and nickel and is positioned to grow its mining business in significant ways. Volkswagen and Mercedes Benz signed agreements with the Canadian government to source minerals in the Great White North.

Although batteries are getting a lot of attention, investment in the solar manufacturing sector is also ramping up. Along with re-upping the incentives contained in the IRA, the administration invoked the Defense Production Act in June to encourage domestic production of solar panels.

Panel manufacturer First Solar was first to respond with a $1.2 billion commitment to building new facilities in the U.S. Since then, Q-Cells announced that its massive plant in Dalton, GA, would get an additional $171 million investment.

Inverters are often treated as the forgotten stepchild of a solar energy system, but they are essential to solar installation. Chinese inverter-maker Sungrow is mulling a significant investment in North America to supply the growing demand here.

The Inflation Reduction Act was passed with a promise to transform the American energy economy. Whether that happens remains to be seen, but initial signs are that the energy landscape in the U.S. is going to be considerably different in 10 years than it is now.


solar installer inspecting solar panel

What exactly is a green bank, and why do we need them?

One of the overlooked provisions in the Inflation Reduction Act is a $27 billion line item for a Greenhouse Gas Reduction Fund, otherwise known as a national green bank.

Canary Media reports that the fund, created as a standalone unit under the Environmental Protection Agency, will offer low-cost financing for small-scale projects such as rooftop solar, efficiency modifications and heat pump installations.

Modeled on several local and state-level organizations, the fund is a lending body specifically set up to fund clean energy projects while also spurring private sector lending. A recent McKinsey report on green banks noted that for every $1 in green bank lending, private sector investors responded with from $7 to $10. In other words, the $27 billion may help drive as much as $270 billion in investment in green technology.

The first green bank was established in 2011 in Vermont. Nearly two dozen similar organizations have popped up around the nation, but nothing with the scale as this new federal initiative. And of all the loans issued by green banks that have come due, over 99% have been paid in full.


swiss floating solar panels

Swiss floating panels

https://www.poralu.com/en/work/floating-solar-platform-on-lac-des-toules/

https://www.weforum.org/videos/23628-these-swiss-solar-farms-are-in-the-alps?collection=popular-video

Every day, utility scale solar becomes a larger part of the energy mx in the U.S. and naturally, that leads to concern for where to put all those solar panels. Recently,10 counties in Ohio banned solar and wind developments with some residents citing the loss of farmland to solar projects.

One solution that has gained traction overseas but not in the U.S., is floating solar panels in water, or “floatovoltaics.”

Increasingly common in Asia, floating PV systems have many benefits. They run more efficiently due to operating in a cooler ambient temperature and also reduce evaporation. Siting these installations in reservoirs bring additional benefits. Often,that means they are closer to urban clusters than a typical solar farm. That makes it much more likely that a site has easy access to robust power infrastructure, lowering the cost of transmission.

In the Swiss village of Bourg-Saint-Pierre, energy company Romande Energie found several efficiencies by building a solar array in a high-mountain reservoir. Tests showed an increase of 50% efficiency over a similar array in a nearby valley.

By building at over 1800 meters, the panels benefit from thinner air, less moisture and pollution. In addition, the snow on the surrounding mountains produces an “albedo” effect, reflecting light back toward the panels. We can’t help but expect a James Bond action sequence to be filmed there at some point.


The Weekly Sunsong

Somewhere there’s a list of perfect pop performances–recordings that transcend time and place. Near the top of that list is Mr. Bill Withers’ Ain’t No Sunshine. Listen all the way through and try not to repeat “I know I know I know I know” a dozen times or so at some point during your day.

With the #InflationReductionAct officially on the books, the U.S. economy is already transforming into one driven by renewable energy. At ADT Solar, we’re excited to be part of that change. The pace of investment is staggering–it seems like a new multi-billion dollar deal is announced daily, with thousands of jobs following.

Check out our weekly roundup of news around the new economy, The Weekly Sun. This week, we’re looking at some of the more breathtaking announcements, drilling into the new federal green bank, and looking at floatovoltaics.

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