Dr. Davor Sutija is the CEO of NexWafe, a solar photovoltaic company establishing a new standard for the future of engineered green wafers.
I see the U.S. solar industry at a pivotal moment. While China has long dominated wafer and cell manufacturing, a surge in investment is creating momentum for domestic production. Notable companies in the solar manufacturing sector have committed to building gigawatt-scale wafer facilities in North America, signaling a shift toward greater energy independence.
At the same time, risks loom. The expiration of tariff exclusions in May 2025, growing restrictions on Chinese exports and uncertainty surrounding future trade policies could leave businesses vulnerable. The key challenge? Securing the equipment and materials necessary for large-scale U.S. solar manufacturing while reducing dependence on Chinese-controlled supply chains.
The Growth Of U.S. Solar
On the positive side, as of the end of 2024, the U.S. now has 50 gigawatts (GW) of new manufacturing capacity, equal to the number of modules installed in the U.S that year. This includes 40GW of crystalline silicon-based module manufacturing capacity.
However, much of the supply chain remains imported, including wafers, cells and commodity components like glass. Without a local supply chain for these components, U.S. manufacturers remain exposed to shifting trade policies and supply disruptions.
Despite these vulnerabilities, major investments are underway. Corning has committed to building a multi-gigawatt wafer facility in Richland Township, Michigan, while Qcells is ramping up a 3GW wafer and cell factory in Georgia. Norsun announced plans for a new ingot-growing and wafer production facility in Oklahoma. Together, I think these initiatives mark a promising start, but they still leave a significant shortfall in domestic production.
The Risks Facing U.S. Solar Manufacturing
Equipment Supply Chain Vulnerabilities
On top of recent blanket tariffs, policy changes have been targeting Chinese solar cells and wafers for a while now. In September 2024, tariffs on solar cells were raised from 25% to 50% and polysilicon tariffs were similarly increased to 50%. Solar wafers were also added to the tariff list.
For U.S.-based companies looking to invest in solar manufacturing, I think the key hurdle is a reliance on overseas equipment and materials. While certain tariff exemptions may stay in place, provisions are subject to change, as we have certainly seen.
As tariff policies evolve, companies may face increased costs that could impact their investment strategies. To navigate these potential shifts, businesses should consider diversifying their supply chains, exploring local production options and staying informed about changing trade regulations.
Furthermore, as already noted, equipment supply is a vulnerability for U.S. manufacturers with Chinese companies holding a near-monopoly on cutting-edge wafer manufacturing systems.
Supply Chain Gaps And Tariff Uncertainty
The U.S. trade case against Chinese-controlled Southeast Asian companies (like in Vietnam, Cambodia, Thailand and Malaysia) has already constrained imports, reflecting a broader shift in U.S. trade policy. In response, many Chinese firms are shifting production to places like Indonesia and the Middle East as a workaround. Meanwhile, U.S. manufacturers are pushing to extend tariffs to suppliers in other countries, which could further constrain supply options.
At the same time, lawmakers are likely to tighten requirements for tax incentives, including the Investment Tax Credit (ITC) and 45X manufacturing credits limiting access to Chinese companies. Therefore, developers relying on imported products and components may lose access to financial incentives.
What Businesses Can Do To Stay Ahead
Secure Alternative Equipment Suppliers
Businesses should explore source-diversification partnerships with European, North American, Korean, Japanese and, over time, Indian equipment manufacturers. While China remains dominant in wafering equipment, Western suppliers are developing promising alternatives that could reduce energy consumption and lower costs. Advocating for extended tariff exclusions on Chinese equipment could also buy time for domestic supply chains to scale up.
Build Redundant Supplier Networks
Companies need to vet suppliers to ensure they are not indirect subsidiaries of Chinese firms. While Indonesia and the Middle East may offer short-term solutions, long-term sourcing strategies must focus on domestically made solar wafers, cells and modules. As of March 2025, the U.S. government continues to promote domestic content requirements through things like The Inflation Reduction Act of 2022 to strengthen the domestic solar industry.
Invest In U.S. Wafer And Cell Production
I believe manufacturers that invest in domestic wafer and cell capacity will be best positioned to capitalize on IRA 45X tax credits and solar investment tax credit (ITC) incentives. Despite the billion-dollar scale of investments required per project, as already evidenced, companies like Corning, Qcells and Norsun are proving that U.S. manufacturing can scale with the right support.
Key steps include:
• Securing domestic supply agreements for polysilicon and other raw materials.
• Urging members of the U.S. Congress to preserve the existing incentives for U.S. manufacturing.
• Developing next-generation wafering technologies that reduce material waste and increase efficiency. Specifically, I think gas-to-wafer processes that can cut energy consumption and eliminate polysilicon waste from wire-sawing can give U.S. manufacturers a long-term competitive edge.
• Prioritizing disruptive technologies like perovskite tandem solar cells.
The Road Ahead
For U.S. solar businesses, waiting is not an option. Companies must proactively secure equipment, diversify supply chains and invest in domestic production to navigate the evolving trade landscape.
Key actions for solar developers:
• Plan for a future without reliance on Southeast Asian or other imports, as these options are already becoming severely constrained. It’s important to start developing an end-to-end U.S. supply chain with increasing domestic content each year.
• Accelerate solutions that combine renewables with energy storage solutions to improve profitability and reduce reliance on natural gas electricity turbines, which have a long lead time and rising costs for construction.
Key actions for solar manufacturers:
• Develop non-Chinese equipment, wafers, cell and commodity sources to ensure long-term expansion capability and price stability.
• Push representatives in the federal government to preserve the IRA 45X credits.
• Invest in next-generation, competitive manufacturing technologies for cells and wafers.
I believe the U.S. solar industry has an opportunity to reshape its supply chain and strengthen domestic production. Companies that act now can position themselves to succeed as global trade policies evolve, ultimately shaping the future of solar and strengthening energy independence.
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