Nestled among the corn fields of Pataskala, Ohio, Illuminate USA’s sprawling new solar factory is buzzing. Hundreds of freshly hired local employees are hoisting pallets, soldering equipment and inspecting their work as sheets of glass are transformed into state-of-the-art photovoltaic panels. They’re collecting hourly wages that start at double the state minimum. The factory has also delivered contracts to area electricians and suppliers. From the outside, these are the hallmarks of the 21st century clean energy manufacturing boom promised by the Biden administration, the result of sweeping incentives designed to restore national prowess in a market dominated by China. In reality, what looks like a domestic triumph is also a win for America’s primary industrial and geopolitical rival. Invenergy, America’s biggest private renewable power developer, owns 51% of the plant. Longi Green Energy Technology Co., the Chinese solar giant, owns the other 49%, and it’s Longi’s panel-making expertise, technology and supply chain that are churning out tariff-free equipment for the US market. People work at the Illuminate USA plant in Pataskala. Photographer: Maddie McGarvey/Bloomberg The joint venture benefits from millions in economic development incentives and federal tax credits for domestic clean energy manufacturing. For its part, Longi avoids anti-China tariffs and deepens its foothold in one of the world’s fastest-growing solar markets. Companies based in or linked to China are replicating the strategy across the US. They are building or planning to build at least a dozen plants with 30 gigawatts of module-making capacity, according to a Bloomberg review of public statements, filings and other documentation. American manufacturers are crying foul, saying these factories undermine their quest to build a domestic solar supply chain. Although other countries have taken advantage of the IRA’s subsidies, political objections have focused on Chinese investment. Bipartisan momentum is building in Congress to block China-backed firms from claiming tax credits for manufacturing anything central to the energy transition—a category that extends beyond solar panels to electric vehicles and batteries. In Ohio, retired middle-school science teacher Eileen DeRolf has become an outspoken critic of Illuminate and the policies that brought it to Pataskala. She points to a 15-year tax abatement from the city and $4 million in incentives from a state economic development agency, to say nothing of the $350 million in potential annual tax subsidies from the Inflation Reduction Act. “I happen to not particularly want our geopolitical No. 1 enemy to benefit off our economic system,” DeRolf said. Illuminate and its American and Chinese parent companies see it differently. They point to an influx of well-paying jobs and to a resurrection of manufacturing in a fast-growing sector of the economy. “We’re a majority-owned American company,” said John Duer, Illuminate’s chief legal officer. “We have a minority partner based in China. We’re not a Chinese company trying to do business in the US.” Read the full story, including how the fight over Chinese clean tech companies is also playing out from Texas to Virginia. Subscribe for even more geopolitical energy news. |