Made-in-Ohio Solar Panels Benefit from Federal Incentives, Supply Chain Politics

Made-in-Ohio Solar Panels Benefit from Federal Incentives, Supply Chain Politics

After being commercialized in Ohio about 20 years ago, cadmium telluride solar panels are now gaining traction, in part because of domestic manufacturing and supply chains.

The sun is shining on two Toledo-area manufacturers and an formerly novel solar power technology with Ohio roots.

Cadmium telluride solar panels had been tested in laboratories since the 1950s, but it took until just two decades ago for the technology to be commercialized. This was made possible thanks in large part to the hard work of two Ohio entrepreneurs who founded what would eventually become First Solar.

Cadmium telluride solar cells have recently closed the gap on cost and energy output after years of competing for a market share with less expensive and more effective crystalline silicon solar cells. Thin-film solar technologies, which employ extremely thin layers of semiconductor material in place of thicker rigid crystalline silicon, have a larger global market share than cadmium telluride panels.

Along with ongoing supply chain politics and fresh federal legislation that encourages domestic manufacturing, the sector is also well-positioned to profit from technological advancements.

These developments are causing a boom in the production of solar panels in Ohio, where two producers of cadmium telluride have announced significant expansions that are expected to result in the creation of hundreds of new jobs over the next few years, despite hostile state and local policies against solar farms.

The third factory for First Solar in Ohio will open in Lake Township later this year. A 1.3 million square foot research and development facility in Perrysburg, scheduled to open the following year, will be built after that 3.3 gigawatt plant. A fourth U.S. is planned. factory to open in In 2025, Alabama will join the company’s total U.S. production capacity to roughly 10 GW.

Toledo Solar, whose products are primarily used by businesses and households, is increasing its production capacity this year by tripling it from 100 to 300 megawatts. Although the company is much smaller than First Solar, which targets the utility-scale market, “that’s a big deal for us,” said CEO Aaron Bates.

“The Toledo area, with its deep ties to the glass industry, was a natural incubator in the early years of our business,” said Chief Manufacturing Officer at First Solar, Kuntal Kumar Verma. More than 20 years later, northwestern Ohio “is home to a pool of thin-film solar manufacturing knowledge that is perhaps unparalleled anywhere in the world.”

Why Ohio?

Two glass industry super heroes serve as the beginning of Ohio’s cadmium telluride solar industry.

While Norman Nitschke spent his formative years in East Toledo, Harold McMaster spent his on a farm in northwest Ohio. The two pioneered the manufacture and use of tempered glass — the stuff used for car windshields so it won’t break into jagged shards. They became co-founders of several companies, including Glasstech.

McMaster and Nitschke then began working on solar energy through Glasstech Solar. Those efforts resulted in Solar Cells, Inc. In 1997, under McMaster’s direction, the business created the fundamental vapor deposition procedure for its cadmium telluride solar cells.

The process uses hot gas to crystalize a layer of cadmium telluride whose thickness measures roughly 3% of a human hair. That layer, glass and other materials make up the solar panel’s “sandwich.” The majority of solar panels used worldwide, made of crystalline silicon, are produced in a shorter amount of time.

Solar Cells, Inc. sold a majority stake in the business to an Arizona-based investment company. became First Solar in 1999 and opened its first manufacturing plant in Perrysburg.

However, it took time for the cells’ efficiency to rise to a competitive level. In the lab, First Solar managed to convert energy at a 22% efficiency in 2016. Those findings were improved upon in a 2019 study by business scientists and research at the National Renewable Energy Laboratory, lowering the possibility of instability that could reduce efficiency.

Toledo Solar chose the Toledo area when it started up in 2019, so it could capitalize on the knowledge base built up by First Solar and nearby universities. Starting elsewhere would have been “such a lift, and it would be so expensive,” Bates said.

Now that cadmium telluride solar technology is mature, it can compete with crystalline silicon, according to researcher Lorelle Mansfield at the National Renewable Energy Laboratory. “It is utility-scale, and it is in the field. It’s out there, and it’s working well,” she said.

Currently, 40% of the U.S.’s supply of cadmium telluride is provided by this industry. utility-scale market and about 5% of the worldwide market, according to the The US-MAC, or U.S. Manufacturing of Advanced Cadmium Telluride Photovoltaics Consortium Several businesses, academic institutions, and the National Renewable Energy Laboratory are members.

According to a Global Market Estimates report published in January, as the energy transition progresses, the global market for cadmium telluride will expand at a compound annual rate of 12.5% from 2023 to 2028.


While First Solar and Toledo Solar are not in direct competition with one another, they do face off against crystalline silicon in the global market alongside other cadmium telluride manufacturers.

For its commercial modules, First Solar reported an average efficiency rate of 18% by the end of 2020. This falls within the low end of the Department of Energy’s reported range of 18% to 22% for crystalline solar panels.

However, cadmium telluride can “deliver up to 4% more energy in hot climates and up to an additional 4% more energy in high humidity,” Theoretically, cadmium telluride panels are also more efficient, Verma noted, with a 30% efficiency level or higher. This is so that the semiconductor layer can react to a wider range of light energy, according to Bates.

Due to their lower material, energy, and water requirements, cadmium telluride panels also provide cost savings during production. They use less carbon than crystalline solar, according to NREL research from a year ago.

Mansfield noted an additional big advantage the cadmium telluride sector has right now: “It is American-made thin-film technology.”

“There’s a lot of advantage to that,” said Executive director of Green Energy Ohio, Jane Harf. Companies are less susceptible to disruptions in the global supply chain.

In the years prior to the Covid-19 pandemic, U.S. companies in the crystalline silicon sector faced supply chain problems because of China is the world’s leading manufacturer of semiconductors, which they use. During the Trump administration, the nation was subject to punitive tariffs due to its violation of anti-dumping laws. China has also come under fire from groups like The Breakthrough Institute and others for its use of forced labor and other unfair labor practices.

President Joe Biden announced in June of last year that solar cells and modules from Malaysia, Cambodia, Thailand, and Vietnam would be exempt from some import taxes for a period of 24 months. The intention was to supply the United States. solar market until domestic production of crystalline silicon semiconductors can ramp up.

In all four Southeast Asian nations, the trade restrictions were partially circumvented, according to a preliminary finding from the Commerce Department in December. Organizations essentially sent Chinese goods to the United States. after just minor additional processing. That suggests imports for the crystalline silicon sector could become more challenging after June 2024, although the 2022 federal CHIPS Act aims to increase domestic production of semiconductors.

According to Bates, Toledo Solar is the only company in the rooftop solar market currently eligible for the full 40% tax credit under the Inflation Reduction Act due to its exclusive domestic production.

Potential supply chain issues can affect the cadmium telluride industry too. Mansfield asserted that only a small quantity of semiconductor materials are required for each panel. Additionally, she said, more effective ways to refine the feedstocks could increase their supply.

“We’re essentially taking two byproducts from mining waste streams — cadmium and tellurium — and combining them into a stable compound,” According to Verma, more than 90% of the materials used to make the modules can be recovered after they have served their purpose.

Gains for Ohio

In addition to the 1,600 jobs at its current Ohio facilities, First Solar anticipates that its Lake Township plant will create 700 additional jobs. Plans call for another 200 jobs to be created at the R&D facility. By 2027, Toledo Solar expects to have added over 250 new jobs.

Additionally, Ohio’s economy benefits from the expansion of the two companies. NSG Pilkington opened a new float glass line in Luckey in 2020, creating about 150 new jobs

The construction of a 150,000 square foot facility in Bowling Green to manufacture steel back rails for solar panels by Ice Industries, which will create about 120 new jobs, was also announced last year.

The US-MAC consortium hopes to address ongoing challenges. The efficiency of cadmium telluride panels can still be increased significantly up to their theoretical maximum, according to Mansfield. It is also possible to improve other panel components.

As domestic semiconductor production increases or as a result of other developments, the market for crystalline silicon may present the industry with more competition. Additional thin-film technologies might present competition. Additionally, Mansfield said, scientists are developing solar cells with stacked semiconductor layers that can respond to various energy bandwidths.

Then there are perovskite solar cells, which can be printed or painted onto surfaces. According to a study published in the journal Science on February 16th, perovskite solar cells with a small amount of the compound DPPP added continued to operate at a 23% efficiency for the entire two-month duration of the study.

Although multiple challenges remain, “perovskite solar cells may start making it to market in a few years,” said study co-author University of Toledo student Yanfa Yan

Politics may also have an impact on how much of the sector’s future expansion stays in Ohio.

Solar energy is “still a political issue. And to me, it shouldn’t be,” Bates said. “Economic factors play a role.” He thinks that state policymakers ought to recognize and encourage Ohio’s leadership in the production of solar panels.

“This is the center of the Western Hemisphere — full stop — for solar,” Bates said.


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