US Solar Panel Shortage and Impact on Green-Energy Plans
Thousands of shipping containers of solar panels have been detained by U.S. Customs near large ports. According to estimates, even more containers have been held up in factories and ports from a few countries including Vietnam and Malaysia or have been diverted to places such as Europe. This is a result of U.S. legislation aimed at cracking down on labor abuses in China.
In June, U.S. Customs began enforcing a new law targeting human-rights abuses in Xinjian, a region in western China that makes nearly half of the world’s solar-grade-silicon which is a key ingredient for most panels. The Uyghur Forced Labor Prevention Act (UFLPA) effectively bans the import of products with parts and ingredients from Xinjian. Under the act, Customs and Border Patrol detain goods presumed to be made wholly or in part in Xinjiang. Goods can be released if the importer proves they weren’t made in Xinjiang.
Panel manufacturers have been attempting to source silicon outside of Xinjiang and provide documentation to prove that. Chinese manufacturers have been avoiding Chinese silicon completely and making panels for the U.S. that use silicon produced by American or German companies. U.S. Customs officials are still holding many panel shipments while they scrutinize documentation. Over the past five months around a gigawatt worth of panels—potentially around 4,000 containers—has likely become stuck in warehouses at U.S. ports, while the supplier’s foot the bill for storage costs, says the Solar Energy Industries Association.
This has impacted US solar deployment because there are very few domestics manufacturers as most solar panels are imported from Chinese and other Asian American Markets. According to the American Clean Power Association, an estimated 23 gigawatts’ worth of large solar projects have been delayed so far this year.
To cope with this issue, solar developers and installers are pushing back deadlines and actively trying to buy panels from new sources. They are also helping to fund the construction of solar manufacturing in the U.S. Many developers have accepted the fact that all they can do is wait. Florida based power company, NextEra Energy (NYSE: NEE) are stalled for lack panels according to Chief Executive of renewable-energy unit, Rebecca J. Kujawa.
Clean-power developers say there are still lots of obstacles slowing their progress. developers say they are grappling with long waits for project permitting and access to transmission grids as well as rising costs and lengthening lead times for equipment orders.