Solar energy equipment manufacturer CubicPV has announced the cancellation of its ambitious plans to construct a major silicon wafer factory in the United States, attributing the decision to plummeting product prices and escalating construction costs.
The company's move deals a setback to the Biden administration's efforts to establish a domestic solar energy supply chain, aimed at supporting the burgeoning demand for renewable energy in the United States. Currently, China dominates the global wafer market, producing approximately 98% of the world's wafers, crucial components of solar cells utilized in panel assembly.
Backed in part by Bill Gates' Breakthrough Energy Ventures, CubicPV had envisioned pioneering domestic wafer manufacturing by completing a 10 gigawatt factory this year. However, the company encountered challenges exacerbated by regulatory and market dynamics.
Despite the availability of federal tax credits for solar projects employing American-made equipment, newly unveiled rules permit solar facilities to claim subsidies even if their panels incorporate overseas-made wafers. This regulatory hurdle posed challenges for the rollout of domestic wafer factories.
Moreover, global solar wafer prices have witnessed a staggering 70% decline since the passage of President Joe Biden's Inflation Reduction Act in 2022, a landmark legislation addressing climate change. A surge in Asian solar production has raised concerns about the viability of numerous proposed U.S. factories.
CubicPV's spokesperson, Laureen Sanderson, declined to comment on the specific policy implications on the project. Instead, the company announced plans to pivot its focus away from wafer production, leveraging its proprietary technology to manufacture panels.
CubicPV's Chief Executive Frank van Mierlo, who has led the company for 16 years, will step down from his role. Tim McCaffery, global investment director with Thai industrial conglomerate SCG and a CubicPV investor, will oversee the company during the transition period.
“Inventing a better panel” is cited as CubicPV's strategic priority to contribute to humanity's fight against climate change and foster a solar manufacturing renaissance in the United States, according to Chief Executive Frank van Mierlo.