Financial Setback for CubicPV

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Less than a year ago, CubicPV, a manufacturer of solar panel components, announced securing over $100 million in financing to construct a $1.4 billion factory in the United States. The company aimed to produce silicon wafers, a crucial component enabling solar panels to convert sunlight into electricity. The investment was attributed to the long-term industrial policy outlined in the Inflation Reduction Act of 2022. CubicPV considered sites in Texas, intending to employ approximately 1,000 workers.

Impact of Chinese Imports

However, the project faced a significant hurdle due to an influx of inexpensive solar panels from China. In February, CubicPV decided to cancel its factory plans citing concerns about financial viability amidst the surge of Chinese exports. Just as CubicPV was preparing to manufacture wafers in the U.S., prices of these components plummeted by 70 percent, jeopardizing the project’s feasibility.

Concerns within the U.S. Solar Industry

This setback reflects the growing apprehensions within the U.S. solar industry and the Biden administration regarding the feasibility of President Biden’s industrial policy agenda. High-ranking administration officials have expressed worries that the influx of low-cost Chinese exports is eroding efforts to support the domestic clean energy sector. The administration faces challenges in financing and fostering a competitive domestic clean energy industry.

Top administration officials have begun warning that efforts to finance a domestic clean energy industry are being undermined by a surge of cheaper Chinese exports that are driving down prices and putting the United States at a competitive disadvantage.

The fate of the CubicPV factory is the type of outcome that Treasury Secretary Janet L. Yellen has warned is likely if China does not stop dumping heavily subsidized green energy products into global markets at rock bottom prices. She took that message to China last week, warning that its industrial strategy was warping supply chains and threatening American workers.

China appeared to dismiss those concerns. Following Ms. Yellen’s meeting with Chinese Premier Li Qiang, his office said, “The development of China’s new energy industry will make an important contribution to the worldwide green and low-carbon transition.”

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