AES-led group to back US solar supply chain with USD-6bn pledge

Cypress Creek solar farm in Texas. (Photo: Business Wire)

June 21 (Renewables Now) - Four independent power producers (IPP) in the US led by The AES Corporation (NYSE:AES) have set up a consortium to purchase up to 7 GW of solar modules for local projects in a drive to support the rapid scaling of the domestic solar supply chain.

Apart from AES, the so-called US Solar Buyer Consortium also includes solar developers Clearway Energy Group, Cypress Creek Renewables and DE Shaw Renewable Investments (DESRI). Together, they have committed to buying between 6 GW and 7 GW of crystalline silicon solar modules per year, according to an announcement on Tuesday. The size of their combined investment is estimated at more than USD 6 billion (EUR 5.69bn).

To this end, the consortium has kicked off a competitive request for proposals (RfP) to identify qualified manufacturers willing to commit to a long-term strategic partnership starting from 2024.

The creation of the consortium comes as earlier this month US President Joe Biden authorised a 24-month bridge for tariff-free import of certain solar products from Cambodia, Malaysia, Thailand and Vietnam to ensure a sufficient supply of equipment to meet electricity generation needs while domestic manufacturing scales up.

The AES-led group acknowledges that the White House’s recent actions represent a large step towards addressing supply chain challenges, but notes that more needs to be done.

"Our joint commitment to procure at this scale can provide the certainty suppliers need to ramp up capacity and overcome current supply chain constraints," said David Zwillinger, DESRI's chief executive.

"With legislation pending before Congress, policymakers can scale our domestic manufacturing workforce and restore our country's legacy as a manufacturing leader. We appreciate the Biden administration's commitment to invest in American workers and urge lawmakers to seize this opportunity,” commented Craig Cornelius, CEO of Clearway Energy Group.

AES alone expects to complete 3.4 GW of US solar projects in the period 2022-2025. Last year, the Virginia-based electric utility signed solar power purchase agreements (PPAs) for 1.4 GW of US capacity.

The company’s president and CEO Andres Gluski stated that the US government needs to create “a realistic, long-term policy framework that supports onshoring more of our solar panel supply chain without unnecessarily disrupting the growth and success of our sector."

(USD 1.0 = EUR 0.948)

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