LONGi Green Energy Technology, a Chinese photovoltaics company, said its 5-gigawatt solar panel production facility in Ohio, the United States, is expected to be put into operation by the end of this year.
Once operational, the joint venture with US-based clean energy company Invenergy in Licking County of Columbus, Ohio, will manufacture high-quality solar panels and become home to some of the most advanced panel assembly technology in the world, said the company.
Once completed, the facility will deliver up to 5 GW of solar module capacity per year, which is equivalent to half the total US utility-scale solar installations last year and capable of powering nearly 1 million American homes, it said.
An analyst said the facility will help establish a more complete solar power supply chain in the United States as market demand for clean energy grows.
The manufacturing facility will amplify Ohio's role in boosting domestic production of solar panels, as most of the solar value chain exists outside the US, creating scarcity challenges and supply chain bottlenecks, said Lin Boqiang, head of the China Institute for Studies in Energy Policy at Xiamen University.
It will help bring the highest-quality solar products to the US while increasing and expanding the technology and renewable energy ecosystem in the region, he said.
LONGi said the company's sales in the US accounted for around 2.4 percent of its global revenue last year.
The company has been optimizing its investment internationally and improving its production and operation capabilities worldwide to satisfy the growing market demand outside of China, including increasing investment in its production base in Kuching, Malaysia and completing the upgrade of its production base in Vietnam.
With the introduction of the Inflation Reduction Act (IRA), the domestic PV manufacturing capacity in the United States is accelerating and many Chinese companies are exploring investments to establish PV factories in the country, said Tan Youru, an analyst from BloombergNEF.
Li Zhenguo, president of LONGi, said going global is a necessary step and the company has been conducting research and evaluations to explore more opportunities in overseas markets.
The complexity of investing and establishing factories in the United States is increasing and the ultimate impact of the IRA is still uncertain, he said.
Li Junfeng, former director of the National Center for Climate Change Strategy and International Cooperation and executive director of the China Energy Research Society, believes that the energy transition goals of China and the United States are aligned.
The IRA illustrates the US government's confidence in the solar power industry while it will also help accelerate the energy transition, he said.
Chinese solar companies should aim higher and have a broader vision, actively expanding their global presence to promote the healthy and sustainable development of the global PV industry, he said.
In addition to LONGi, JinkoSolar announced recently that it will establish a 2GW PV module factory in the US while SPI Energy Co Ltd also plans to establish a silicon wafer factory in the United States, with the first batch of wafers produced by the end of 2023.
According to LONGi, manufacturing capacity in the photovoltaic industry is becoming more decentralized than ever in recent years.
With the IRA introduced by the US, the REPowerEU Plan introduced by the European Commission and the National Program on High Efficiency Solar PV Modules introduced by the Indian government, countries across the globe are eyeing to increase domestic production capacity and reduce import dependence on the renewable energy sector, it said.
Driven by the global consensus on carbon neutrality, the photovoltaic industry, as the most representative and competitive renewable energy source, continued to experience rapid growth in 2022.
According to statistics from the China Photovoltaic Industry Association, global PV installations reached 230 GW in 2022, a year-on-year growth of 35.3 percent. The main demand markets, particularly China and the European Union, witnessed significant growth rates exceeding 50 percent.
In most countries, solar power remains the lowest-cost source of electricity and the Russia-Ukraine conflict has further made the international community aware of the importance of energy security, resorting to solar power more than ever to enhance domestic energy independence, said Lin.
LONGi achieved a revenue of 129 billion yuan ($18.3 billion) in 2022, a year-on-year increase of 60.03 percent. Net profit attributable to shareholders of the listed company rose 63 percent year-on-year to 14.81 billion yuan.
The company's revenue reached 28.32 billion yuan during the first quarter this year, up 52.35 percent year-on-year, and it expects the 2023 revenue to surpass 160 billion yuan.
By the end of 2023, the company plans to achieve an annual production capacity of 190 GW for monocrystalline silicon wafers and 110 GW for monocrystalline cells.