Catalyst with Shayle Kann - Scaling America's domestic solar supply chain

Episode Date: March 19, 2026

Despite the dark cloud of federal policy hanging over the solar industry, skyrocketing load growth is driving demand. The question is whether supply can keep up. In this episode, Shayle talks to Scott Moskowitz — VP of market strategy and public affairs at Qcells and board chair of the Solar Energy Industries Association (SEIA) — about the challenges of reshoring solar in the U.S. They cover topics like: How supply chain resilience incentivize reshoring efforts The specific state of polysilicon, wafers, cells, and module reshoring Why resource “clustering” has been a boon for Chinese solar manufacturing Industry challenges around permitting solar Why American solar remains so much more expensive per watt than Chinese solar The threat of technological obsolescence to funding solar projects Resources Catalyst: More 2026 trends: Solar costs, oil oversupply, and the startup slump Catalyst: Tumult in residential solar Open Circuit: Does residential solar have a bad product? Latitude Media: GlassPoint is back, and armed with global expansion plans Latitude Media: Tesla’s rooftop solar paradox Latitude Media: Can the US bring solar installation to below $2 per watt? Credits: Hosted by Shayle Kann. Produced and edited by Max Savage Levenson. Original music and engineering by Sean Marquand. Stephen Lacey is our executive editor. Catalyst is brought to you by Uplight. Uplight activates energy customers and their connected devices to generate, shift, and save energy—improving grid resilience and energy affordability while accelerating decarbonization. Learn how Uplight is helping utilities unlock flexible load at scale at uplight.com. Catalyst is brought to you by Antenna Group, the public relations and strategic marketing agency of choice for climate, energy, and infrastructure leaders. If you're a startup, investor, or global corporation that's looking to tell your climate story, demonstrate your impact, or accelerate your growth, Antenna Group's team of industry insiders is ready to help. Learn more at antennagroup.com. Catalyst is brought to you by EnergyHub. EnergyHub helps utilities build next-generation virtual power plants that unlock reliable flexibility at every level of the grid. See how EnergyHub helps unlock the power of flexibility at scale, and deliver more value through cross-DER dispatch with their leading Edge DERMS platform, by visiting energyhub.com.

Latitude Media covering the new frontiers of the energy transition. I'm Shale Khan, and this is Catalyst. I think we face two challenges when you're trying to build a factory, which is the first of its kind in the United States. One is that, you know, you have to find a contractor to build, say, a wafer factory that's never built a wafer factory before. And then you have to work with, you know, local permitting jurisdictions that have definitely never permitted a solar cell or wafer factory before.

So there's a lot of education. education work that has to get done to overcome that. It is overcomable. It's not something that we can't do. You know, we build things that are new in the United States all the time. It's just a matter of getting that infrastructure in place and doing the education work. Coming up, building solar in the U.S. When utilities need flexible capacity they can count on, they turn to Energy Hub. Energy Hub works with more than 170 utilities, coordinating over 2.5 million devices to manage 3.4 gigawatts of flexibility built for the moments when utilities can't.

afford uncertainty. Energy Hub builds and operates virtual power plants that utilities actually stake their grid planning on, coordinating EVs, batteries, thermostats, and more through a single platform built for utility scale. Predictive, verifiable, and designed to perform when it counts. Learn more at energy hub.com. Trillions of dollars are flowing into clean and critical infrastructure, but those investments aren't driven by technology alone. They're shaped by markets, by policy, by capital, and by the institutions that connect them. I'm Alfred Johnson, CEO of Crux, and host of a brand new podcast, Critical Capital. Each episode, I talk with people deploying capital, shaping policy, and building the clean economy.

Tune in as we unpack how progress is actually made. Listen to Critical Capital on Spotify, Apple, or wherever you get your podcasts. Catalyst is supported by Fish Tank PR, an award-winning PR firm focused on climate and energy tech, renewables, and sustainability. Fish Tank is known for generating prominent and effective media coverage for the brands they work with. If you want a PR partner that's thoughtful, shoots straight, and gets results, you'll like Fish Tank PR. To learn more about Fish Tank's approach, visit fish tankpr.com. That's F-I-S-C-H-Fish-Tankpr.com. I'm Shale Khan. I lead the early-stage venture strategy at energy impact partners. Welcome.

So something I've noticed recently, I think there are two prevailing types of sentiment about solar in the United States right now. I'll tip my hand that I think one of them is right and the other one is wrong. The wrong one is basically quite negative. People have noticed the policy winds shifting, the gutting of the IRA, the slowing of federal permitting, and they get the impression that it's actually dark times for solar in the U.S. But anyone actually in the market generally sees the opposite.

The tax credits still exist. Demand is booming, thanks to load growth, speed to power, et cetera, all the terms that we've used a million times on this podcast. And if you look closely, sentiment towards solar, even within MAGAverse, has thawed substantially. So it's actually boom times for solar right now. That's on the demand side. But what about the supply side? Are we in for an industrialization, a domestication of solar manufacturing? What would it take to really do that?

It's an interesting conversation, I think one that isn't had enough. So for this one, I brought on an old and dear friend. Scott Moskowitz is the VP of Market Strategy and Public Affairs at QSELS, which is the largest domestic silicon solar manufacturer. Scott is also the chair of the board of SIA, the Solar Energy Industries Association. So he wears the hat of somebody who is making more waifers and cells for solar than anyone else, and also somebody who is representing the industry in policy discussions. Scott and I also worked together on solar more than a decade ago at GTM, which was my previous company before EIP, so it's good to be back talking solar again with Scott. Here he is. Scott, welcome. Hi, thank you. It's very good to see you. And I'm excited to have this conversation. I want to start with a question that, I don't know, feels initially like it's sort of obvious, but I think it's worth walking through it anyway, which is you're both personally and professionally a big proponent of building a domestic,

solar supply chain in the U.S., why do you think that's important? You know, it's funny because you and I, we worked together a long time ago, and when we did, it was conventional wisdom that, you know, this supply chain for clean energy and lots of these industries in general had, you know, largely focused offshore. And, you know, we went from a conversation of how do we make renewables as cheap as possible, as quickly as possible, to where we are now, which is, you know, solar is cheap. And now it's a matter of where are these supply chain is local, where are they located, and how do we ensure that they are resilient and durable for the scale that we want to be deploying this stuff in the years ahead? So, you know, I think it's

remarkable that we're having this conversation now, given where we were years ago. But, you know, in my view, it's something that we've learned over 10 years of geopolitical shifts over a pandemic that tested supply chains in every industry, but really showed that we want to have supply chains domestically as much as we can, in particular for critical sectors like energy. Yeah, the history of it in solar is interesting. So when I started with looking at solar way back in the day, a few years before you did, it was Germany, right? Germany was manufacturing most of the solar.

And then Germany basically lost the battle to China, and China scaled and took over and drove costs down. And then China kind of expanded out as a result of tariffs mostly from China to like Southeast Asia. So then a lot of solar started getting manufactured in Southeast Asia, but it was still Chinese companies for the most part. And then now there's this interesting, as a result, I don't know, of predominantly policy. You can tell me if there are other drivers that you've seen resulting in this. Now there's this interesting question of, at least in the U.S., I think more so than in Europe,

are we going to build up a fully domestic, mostly resilient supply chain? We'll talk more about what that actually means because it's not one thing. But do you see that as having been driven predominantly by policy? Or was there a push before that? You know, you had trade policy, which kept the industry alive for a long time. It didn't necessarily allow it to reach the scale that it is now. But, you know, I think there'd been a focus in an effort to reshore, you know, even prior to the Inflation Reduction Act being passed a couple years ago.

But, you know, it was really that piece of legislation that created, that it made it economically feasible to do it. And, you know, we're at a point now where, you know, if you're a buyer of solar panels in the United States, pretty much every panel you're going to get is at least domestically assembled. And so most of the market at the moment really thinks that this is a domestically resured market. You know, it's when you get upstream to sell as wavers polysilican, that it becomes a, you know,

still an open-ended question. But, you know, we've really hit that point where pretty much everything that gets deployed to a customer comes from somewhere in the United States. Okay, so you hit on the next thing I want to talk about, which is that people who aren't steeped in solar world think of the supply chain as being panels. and the final step is module assembly. And I mean, you could go downstream of that, I guess, and put on frames and inverters and stuff.

But the final step in solar modules is assembly, and that, as you said, has been fairly domesticated. But we should talk about the whole supply chain because I think it is important to do so and to recognize what that looks like. So in the context of crystal and silicon solar, which is basically the entire market X for solar, the supply chain is polysilicon, wafer, cell module.

So can you walk me through how much domestic manufacturing we have of each of those four steps? Yes. So even, again, even before the IRA, we had a fair amount of module assembly, which was supported by trade policy. And we've had, you know, a historically decent amount of polysilicon for, you know, two decades now. And, you know, at the moment, we have enough module capacity to supply U.S. demand. That's, you know, 40 to 50 gigawatts a year. And there's probably even more than that. On the poly side, we're probably 10 to 20 gigawatts. It's a moving target. Obviously, there's three big poly manufacturers in the U.S. or at least there have been historically. historically, you know, one of which is RAC silicon, which is switched to silencing gas, is something that we, my company Q cells really participated in. But then there's Hemlock and there's Valker. Vocker mostly gets their semi-grade, or solar-grade polysilicon from Germany. So it's really just a couple of players for probably 10 to 20 gigawatts or so of polycapacity. And then in the middle, cells and wafers, you know, you didn't, you had, up until the IRA, you had zero of those factories, none. You know, and in fact, wafer's pretty much 99% of them work

coming from China. They largely shifted to Southeast Asia over the last five years as a result of another trade case. But you've seen investments in that sector finally. There's more cell manufacturing than there is wafer manufacturing. At the moment, there's only two companies, Q cells and Hemlock Corning, that are making wafers, are about to start making wafers in the United States. So there's more sell, but it's again, it's an ongoing effort of reshoring. I really think of it in like, you know, there's probably like four stages of this. There's where we were pre-IRA of an industry that was kind of surviving. There's where we are now of. of an industry that has made a lot of investments

isn't sort of on a path to re-shore. The third would be, you know, finally having some self-sufficiency to serve the entire U.S. market, and then aspirationally, the fourth would be, you know, being competitive on a global basis and scaling for export.

So, you know, I think we're, you know, we're kind of at part two of hopefully a four-step process of where the industry really builds itself back up. Yeah, I've always thought it's interesting that people didn't even appreciate that prior to the IRA, prior to a bunch of investment

in wafer and cell manufacturing in the U.S., which there's still not that much wafer manufacturing, as you said in particular, and there's more cell, but not much wafer. A typical supply chain would be polysilicon, if solar-grade polysilicon is made in the U.S. or maybe in Germany, it's then shipped to China, or increasingly in recent years to Southeast Asia, where it has turned into wafers and cells, at which point is shipped back to the United States to be assembled into modules. That was kind of like a very typical supply chain. And the question is, can we build those intermediate pieces?

Let me ask you this, though, why, if you look at that sort of historic barbell of, we had some polysilicon, we had a fair amount of module assembly, why are those the ones that are those the ones that got domesticated first? People would assume it's low labor, basically. Are those the things that require the least labor per watt, or is it something else? On the polyside, the predominant cost for polysilican manufacturing is the cost of energy, to input. And so, you know, you have, uh, you look at RAC Silicon. It's in Washington State. They have some of the cheapest hydroelectricity in the world, right? Same with Michigan, a lot of nuclear, a lot of coal,

a lot of natural gas, like very low, relatively low electricity prices. And that sort of drove and enabled a lot of poly, which is also supporting the semiconductor industry, right? So, you know, there's a matter of which solar grade poly manufacturing is critical to semiconductors. On the module side, you know, part of it was just that it's, uh, the economics can make sense. It's not necessarily labor. It's fact that it's bulky manufacturing, shipping costs matter, and it's relatively quick and simple. Not to say that they're not really incredible factories. We've had module manufacturing in Georgia for the last eight years. Anytime anyone visits it, they're blown away. It used to be, you know, it's like, oh, we don't need these factories here. They're highly automated. They're

not a lot of jobs. But even a, you know, two gigawatt module assembly plan is going to be 800 people, well-paid manufacturers, engineers, technicians, all sorts of stuff. And it's a really impressive, complicated process, but it's not, it doesn't require the same amount of capital investment, chemical infrastructure, lots of complicated localized type supply chains that you would have for, say, cells and wafers. So it was easier to do modules first. So that, I guess, gets to the next thing, which is let's talk about cost competitiveness. We have incentives. I mean, and it's hard to be apples to apples, right, in terms of total cost between the U.S. and China in particular, right? because there's like all these hidden subsidies in China.

But as you think about it, let's start with module assembly, which is where, as you said, it sort of was easiest to make the case that it was economic to produce domestically. If you think of the closest you can come to, to an apples to apples comparison, how close to cost competitive are we? Module assembly in the U.S. for the U.S. market

versus module assembly in China for the U.S. market, excluding tariffs. I'll put it into his first, let's compare in the U.S. market in general, right? and whether or not solar, even if it went more expensive, like, it's a reality that it costs more to manufacture things in the United States than it does in China or other parts of the world. I think one of the things we've learned in the last five years is that even when a product is made in the United States and solar specifically, it is still cost competitive with other

forms of technology. You look at Lazard's LCOE models and those cost charts, solar is always going to be right on the bottom, and that is even when you have U.S. manufactured goods into the mix, right? So I think in the U.S., we've proved that you can make it here and have it still be an appropriate technology. The question that you're asking is, how do you make it scale or be competitive on a global basis? That's what 45X was designed to do, right? It was designed to overcome the cost differentials between making something in the U.S. and making it in China or other parts of Asia.

And we're getting closer to it, but it's still something that requires scale and it requires localized clustering of manufacturing investments. Because, you know, if you look at what things cost to make in China relative to anywhere else, a solar panel, you can often buy them on a global basis for seven, eight, nine cents a watt, right? And the reality is we're not quite there in the United States, even with 45X. But when you have a slew of other policies involved, whether that's domestic content, whether that is trade policy, whether that's other types of mechanisms which drive demand for U.S. manufacturer stuff, again, it's going to be cheap relative to natural gas and every other form of energy. You mentioned that in the context of polysilicon, the main cost is energy, which is why we've got REC and Washington and so on. For Waifer's cells and modules, what are the, like walk me through the cost stack. How much of it is CAPEX, labor equipment materials, like what should I be thinking about is the things that really drive it so that we can really understand the comparison between what it costs in China or other parts of Asia versus here? I'd say it's a mix of the capital cost to build the plants. You know, it's one of the things that is a big reality is that it's just more expensive to build a structure here. If you look at the, like, you can search what it costs to build a factory for a couple gigawatts of cells in the United States versus what it's going to cost someone to do it in Vietnam.

You know, just the construction cost alone is dramatically different. And that's whether, you know, this is a result of not electricity prices, but steel prices and contracted labor. and all sorts of permitting and other things that are a bit different in other parts of the world. But otherwise, like, you know, the equipment you can buy on a global basis and it's relatively commoditized, whether that's for a panel, glass, frames, junction boxes, all sorts of things. You might have to pay a tariff on some of those things. But otherwise, like, those are the real, you know, on a generalized basis, the cost difference just becomes an aggregation of factors.

It's not any one particular thing. But, again, that's what 45X is really built to address, is to try to make. make sure that any differences you might face is going to make sure that the U.S. can be competitive. And it's also, you know, not something that's said it's going to do this forever. It was supposed to incentivize investment, create some certainty of demand, and then build enough scale. Because that's the other thing the U.S. hasn't had. You know, we've had a bunch of like a couple hundred megawatt plants here and there, but we're competing on a global basis for five, 10, 20 gigawatt type plants, right? Much, much larger facilities. So when you hit those economies of scale,

all of those things become much, much smaller. So that's what we're focused. I think you mentioned like we need like a clustering of manufacturing. One other thing that I've heard over the years is that one of the advantages that China has had as it has scaled up the supply chain is just that there is an abundance. There are multiple suppliers of everything, whether it's equipment or whether it's materials or whatever. And not only are there multiple suppliers, but they're in the same region and easy to access and shipping costs are low and you can switch and it's resilient supply chain and so on. So if you're trying to stand up a supply chain from virtually nothing, particularly if we're talking wafers or cells, which you guys are doing at Q cells in the U.S., you don't benefit from that. So, like, does that, is that a meaningful disadvantage? Just that, you know, we don't have enough suppliers for basically everything that you need?

It's definitely a challenge to reshoring. It's like one of the critical first steps of it, right? You know, I think we face two challenges when you're trying to build a factory, which is the first of its kind in the United States. One is that, you know, you have to find a contractor to build, say, a wafer factory that's never built a wafer factory before. And then you have to work with, you know, local permitting jurisdictions that have definitely never permitted a solar cell or wafer factory before. So there's a lot of education work that has to get done to overcome that. It is overcomable. It's not something that we can't do.

You know, we build things that are new in the United States all the time. It's just a matter of getting that infrastructure in place and doing the education work. The supply chains, yeah, you're buying a lot. of things off global markets. And you know, you're doing work to not just reshor your own part of the market, but other parts of the market. First solar has been good at this in Ohio. They have, you know, they've got a local glass float manufacturer who they've, you know, supported and helped invest over the years. And, you know, I think a good analog is the auto industry. You know, in the South in particular where I live, you've had since like the late 80s, you've had a bunch of

global car manufacturers move down here. You've had BMW in South Carolina. You have Honda. You have Kia, Hyundai, Volkswagen's up near Chattanooga. They have been building factories here for the last three decades or so, and in doing so, they've created a lot of those clusters. So it's kind of one of those like chicken or egg problems. And the chicken, in this case, is the factories, right? The eggs are going to, the new, all of the supply chain and all the other clustering things will come as a factor of their being demand for that product here.

But you can't have, you know, one's not going to come without the other. So we've been saying that on the module side for a while. We've had that factory in Dalton, Georgia, for eight years where it makes modules, but it was the first of its kind in the southeast. And a lot of the stuff was coming from around the world, and now more of it is coming from the U.S. as it's created that economy of scale and that demand. What was the calculus internally when you all made the decision to build vertically integrated, to go wafer cell module? You already, as you said, manufacturing modules and a bunch of folks were doing that. but the rarer decision was the one to vertically integrate all the way up to wafers.

So, like, walk me through that calculus. It was, I would say it was a function of the lessons learned from the pandemic, right, where not only, well, two things, in fact, the pandemic and, pandemic and trade issues. So on the trade side, you've had, you know, again, a dozen years of various trade cases, but then you also had the passage of the Uighur-Force Labor Prevention Act, which, you know, really affected the supply and origin of polysilicon and metal, all the, all the things upstream of that coming from around the world. And for customers, it made them want to know, you know, they learned very quickly, we were talking about module cells wafers. People all of a sudden had to learn what

quartzite was and metallurgical grade silicon and things that they never even thought of before and where their products came from. So for us, you know, customers were saying that they wanted to know where every single piece of that solar panel came from and they wanted as much of it domesticated to prevent any supply chain risk moving forward. They know where it comes from. They have a sense of what it's going to cost. They know it's going to be a good product. So for us, you know, we really went about trying to localize everything to build a fully U.S. supply chain. So we started with announcing the factory in Carter'sville, which is 3.3 gigawatts of modules, ingots, modules all the way to ingot and wafer, cells included. And we had also made an

investment in RAC Silicon in Washington State to restart the poly plant that had been stranded there after they lost all of their wafer customers around the world. And that was a really challenging endeavor that we ended up, that plan, as I mentioned, is shifted over to sily and gas. But we've been, you know, working on some really strategic sourcing of polysilicon as well. But, you know, that was really the motivation for it. And it was, you know, the 45X incentives, domestic content incentives that really created the economic ability to make that type of investment. virtual power plants are becoming a reliable way for utilities to manage capacity, but enrolling devices is just the start.

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We're living through a profound economic shift, and energy sits at the center of all of it. Trillions of dollars are flowing into power plants, transmission lines, battery factories, data centers, but the future of energy isn't shaped by technology alone. It's shaped by markets, by policy, by capital, and by the institutions that connect them. I'm Alfred Johnson, CEO of Crux, the capital platform for the clean economy. Join me for my brand new show, Critical Capital, as I talk with people deploying capital, shaping policy and building projects. Together, we unpack how risk is priced, how incentives are structured, and how progress is actually made. Listen to Critical Capital on Spotify, Apple, or wherever you get your podcasts.

Are you tired of overpaying for big-name PR firms, but not really knowing what they're delivering? Is your comms team wasting time reviewing lengthy messaging briefs and decks, instead of engaging journalists or producing content? Are you wondering why your competitors are getting press and you aren't? Fish Tank PR is an award-winning climate and energy tech, renewables, and sustainability-focused PR firm dedicated to elevating the work of both early stage and established companies. Whether you need to position yourself as a thought leader in between project announcements or translate complex ideas and technologies into tangible, compelling stories that resonate with the media, F-TankP-R-C-C-T-R-C-C-T-T-R.com. Have we seen a wave of fast followers? I mean, you mentioned there's Emlock, Bacher, et cetera, but, you know, 3.3 gigawatts compared to a 50-gig-wack.

lot market is still pretty small. Especially versus the 50 plus gigawatts of module assembly capacity, which as you said, does already exist here. So are we seeing, like, where are we on the trend line? You know, I mentioned the four phases of reshoring this. We're on that part of where we have a lot of one thing. We have a lot of modules. We're still trying to reshore the other aspects of it.

And it's part of it's a success story. It's a huge success story. We've had, you know, manufacturing. as a whole is contracted in the United States over the last five years except for clean energy manufacturing. You know, it's been, you know, you look at Rhodium had reports of, you know, how much investment came out in the

two years following the IRA as relative to before it. And this sector in particular, and it was five times easily. So you've got really strong success stories in this market. You've seen other manufacturers, sells, all sorts of things have come. The challenge has been to get to that third piece of self-sufficiency. We've, we've

struggled with a couple of things. one was how that policy has been implemented, both during the Biden administration and the Trump administration. It took a long time to get guidance issued on things like domestic content and lots of these other pieces of it. And then there's, of course, been changes with OBBBA. But then the other was sort of some of these macro market conditions that we saw predominantly stemming from China,

which was that over the last five years in China, the big piece of economic news was that their property sector crashed. And when that happened, you know, they really did compensate by essentially doubling down in export-oriented manufacturing of solar batteries and electric vehicles, the same three markets that were really driving all of that investment that folks like Rodeon were tracking. And what that did was it really oversupplied the entire global market. And it really had an impact on how much manufacturing investment actually came to be in the last three years. So I think we saw a huge amount of growth, but, you know, it didn't allow for a complete transition of reshort supply chains into the U.S. So we're still looking for, you know, that next phase and trying to figure out, you know, what's going to drive those new investments that are needed to really hit self-sufficiency. I'm curious how you think about, it's complicated. I have complicated feelings about this, but part of the result of how the U.S. has tried to

address the supply chain for solar, a combination of carrots and sticks, basically, to have domestic supply, which seems to be working to some extent. I mean, certainly QSEL is a good example of it, and there are others as well. So success story. On the other side of the coin, you know, we pay 30 cents a watt for solar modules in the U.S. or something like that, and the global average price is probably 10 cents a watt. So I don't know. How do you reconcile your feelings about the fact that we are building a domestic supply chain, but paying three times the cost of the rest of the world for solar modules? I think it's because we know that we're not at the end goal of this. The end goal is not to have that particular thing be the fact pattern forever.

I think we're trying to get to a point where we have much more scale than we currently have. So in companies like Qcells that have made multiple investments in these supply chains, companies like for solar, which are building basically the same modular-type factory in various parts of the United States, are focused on trying to get to that phase. But it just takes a little bit of time. And, you know, part of it is that, you know, I think we have learned that, you know, customers aren't going to voluntarily pay that 30 cents over 10. They don't want to be paying more. And it speaks to me to the importance of policy. You know, you really need industrial strategy to say, we're going to continue to invest in this market so that we can scale it and make sure it's globally economically competitive around the world.

And that is still a work in progress because, you know, we've had carrots, we've had sticks. on both counts, you know, there has been, you know, back and forth on those types of policies. And I think that's one thing you sort of need is you need some sort of continuity and continued push to say this is a strategic sector that we're going to invest in. And I think, again, I think the public sentiment is there that, you know, we want to reshore industries and specifically energy. But it's just going to take a little bit of time and a little bit more focus because of the way that these markets have sort of shaped up.

Tell me if you agree with this or not. I think there's maybe an extent to which we sort of got lucky with the timing, which is we instituted the set of policies that has resulted in both a resurgence in manufacturing or maybe, I guess, an emergence of manufacturing. We never really made way for ourselves in the U.S. before anyway. So an emergence of manufacturing for solar in the U.S., which resulted in higher prices than the rest of the world is seeing. But that has basically coincided with this period of unprecedented demand for new energy generation, thanks to AI predominantly, which has meant that the fact that

solar PPA prices have gone up over the past couple of years, not down, which is a narrative violation for some people, but is true. Yeah, right. Has made that fact palatable. And we're still, you know, I mean, we've been talking about the supply side, but on the demand side, you guys are selling a lot of modules, right? And like that price is being borne by the market reasonably well. And in fact, I think that the outlook for solar demand in the U.S. seems pretty rosy at the moment. So maybe we sort of lucked out with the timing. A little bit. Would you attribute those rises in PPA prices specifically to component and supply chain type stuff or also financing costs or other? Like to me, it's not specific to any

particular market. So I think we've, you know, as our price, have gone up, you know, some of which just tracks general inflation levels too, right? Yes, it's a bunch of things, right? I didn't mean to apply that the PPA prices are exclusively a result of module prices being high. That is a factor amongst a bunch of factors that have driven those prices up. Some of the other component of it is like a supply demand thing. You just can't charge more for PPAs because there is such a demand for power that you can get quickly, which solar happens to be. Yeah, right. No, we should. I want to talk a lot more about that just because the, you know, goodness gracious, the politics in general of the energy industry have changed like crazy over the last three months. And they've changed twice. First with, you know, we saw in the, in all of the elections back in November and December the impact of electricity prices and data centers, you know, and what that has done to essentially local elections everywhere. It's the only thing that anyone is talking. It's one of the top topics in every state house in America at the moment. And then second with the war in Iran, which has led,

you know, creates another energy type situation, which we saw after Russia had invaded Ukraine several years ago in which electricity prices went up around the world as a result of gas, you know, changes in supply to natural gas. And then Europe specifically that led to a wave of clean energy, right? And I think, you know, that plus where we are with data centers in the U.S., you know, the reality is, again, even at 30 cents a watt, and if we're made in the U.S., we are still the cheapest and fastest thing to deploy in pretty much every scenario. So, There's a lot going for, you know, for the market from that perspective. But the other thing, too, like, to your earlier point of, like, why do we even want this

stuff in the U.S. to begin with? There's really, like, I think back to, one of the things I used to, an example I used to give a lot was that, you know, arena tracks, you know, jobs in the energy and the solar industry in particular around the world. And, you know, up until right now, China is installing like five to ten times the amount of solar the U.S. is. But historically, it was usually like two times the amount in any given year. But if you looked at the jobs figures for how much the U.S. had versus how much China had,

it was like 250,000 jobs in the U.S. and 3 million in China. So they were installing twice as much, but they had 10 times as many jobs. And it was really a matter of how much of the supply chain that they had. And to me, that's always been one of the core reasons to talk about, you know, independent of supply chain certainty and national security and all these other aspects of it. You know, when you have a manufacturing basis, you have political power. You have lots and lots of durable, really good jobs that you want to support. And that's one of the reasons I think China went from, you know, installing two times as much solar as the U.S. to 10 times is because they had a big domestic industry to support.

And then the second aspect on the next wave of that is, you know, solar has become so cheap. We're seeing it all over the world. There's all these articles in the last, you know, a couple of months about, you know, solar being installed in Cuba and South Africa and all these places where they have their own energy crisis. Yeah. And that is because of unbelievably large availability of low-cost solar panels, which for them predominantly comes from China. But for us, I think it's a huge opportunity that we ultimately want to be supplying those things too, particularly with Europe and Mexico and all these allied governments, all these countries around the world that the U.S. does a lot of business

with. I think the same way we want to be a player in LNG and all these other energy markets, we want to be a player in this market. So I think that's where we have a really strong drive to narrow that gap of that 10 to 30 cents that you've identified. You know, it's not, it's the objective to really get to that point where long term we're competing on a global market. Yeah, and I, you know, as bullish as I am on solar demand in the U.S. and bullish on solar manufacturing growth in the U.S. as well, I don't want to let the solar industry off the hook on this. I was just thinking I, I think this is back when you and I worked together, I wrote this paper with Verun Sivaram in 2015 or something like that, that Veroon has been on the pod,

is now the CEO of Emerald AI. But we wrote this paper for, I don't know, nature energy or something like that that was titled Solar Needs a More Ambitious Cost Target. And I forget about this paper for like years at a time. And then I get some email of somebody citing it every couple of years. But at that time we were saying, you know, this was on a KAPX basis for systems, not LCOE.

But, you know, the goal at the time had been the DOE had this program called the Sonshot Program and the stated goal, the Sonshot Program, was to get to a dollar a watt fully installed solar. And the point of the paper was to say that's not ambitious enough, right? We need like a far lower cost than that, ultimately, especially given that we're going to deploy a lot of solar and in the places that it's at high penetration,

it's going to have decreasing value on its own. So we said, I don't remember exactly, something like 25 cents a watt fully installed or something like that, which should be the target. I still feel that way, right? I think it is, we have an amazing solar industry, and it's come an incredibly long way in the decade since then, but I still think that we can't rest on our laurels.

I'm concerned about the fact that PPA prices have gone up over the past two years. There was a lot of sort of adjacent industries banking on like the marginal price of electricity going to zero ultimately and really thinking of that as being like a solar price is going to go to zero overtime thing. And the fact that we were directionally headed in the opposite direction, or at least have been recently, is not good news to me. So like I'm very excited about solar and super. optimistic, but I, like, want to hold the industry's feet to the fire and say, we still need a more ambitious cost target.

It's fine. I remember that paper. It was the solar will eat itself type argument eventually. Yeah, it was that, right, as a result of solar eating itself, we are going to need solar to be a lot cheaper. Yeah, and it's funny. You know, it makes me, I put solar panels on my roof last summer while the tax credits were still here.

And, you know, the price of the panels relative to the overall installation is still so small. And it's like the same exact things that we were talking about 10 years ago, which is that, you know, the soft costs are still high, right? And it's still, like, you know, we still install a system. Like, we really didn't solve that for residential. We've, like, addressed a little bit of it with utility scale, not actually that much, but a little bit. Residential, it's crazy. And I was a customer who knew my installer because they were friends of mine.

And, like, I had no acquisition cost, right? So it was still, you know, there's still just the other components and the permitting and the applications, all sorts of things are still a work in progress. But on a manufacturing basis, yeah, I agree. And like, we've seen that around the world where prices have gone from, you know, we, I mean, even in the U.S., we got below a dollar. While, would it still cost, it probably still costs, it might even be a little bit more on a utility scale basis right now. Though it's also not apples to apples, because for the most part, utility projects have batteries now when they did not use two in the past. So still thinking about it.

But, yeah, I think it's a good push and something we should be thinking hard about. All right. So I guess to wrap it up, if you had to pick, like, what is the hardest thing? What's the biggest choke point? If you're trying to scale up this middle of the supply chain for solar in the U.S. in gets wafer's cells, what are you finding to be the hardest thing? I still think it's the general economics. You know, even when you do have a high price market like the U.S., we are still competing on a relatively global basis.

one, because products still are imported from around the world. And then two, pretty much every manufacturer, whether they're headquartered in the U.S. or in China, has built a factory in the United States too, right? So you have pretty high volumes of, you know, if you are selling modules in the U.S. with U.S. made cells, you're competing against someone selling modules with imported cells and all sorts of things.

So, you know, you really need customers that are going to give you assurances that they're going to be off-takers for 20 years that that factory will be around it, however long it is. And, you know, I think it's funny because if Jenny Chase from Bloomberg were listening on this interview, she'd be like 20 years for a module factory, most of these factories get built and then they are uneconomic. Like the economics change after five years because, you know, this is an industry in which, you know, I usually say there's two rules of thumb. One demand grows faster than people think it will, and two, prices fall faster than people think they will. I think we're talking about how the latter has sort of changed over the last three or four years. But, you know, it's still just a really, you know, really complicated market. And it just takes that, again, real strong focus to say we're going to continue to reshore this market and value that because, you know, it's just, it's different than, say, other industries in which we are already, you know, highly competitive. Think aviation

or pharmaceuticals or automotive or things like that. But on a global basis, you're competing against heavy, heavy scale. And a market that's, you know, even though we're still growing, is relatively mature on a manufacturing basis, right? Solar panel manufacturing, especially to the extent that it's clustered in China is, you know, these products are incredible. They last for a long time. They're cheap.

They are, we continue to have them get better, but they're really, really incredible products. So, you know, you really have to understand that you're not just, you're competing, but you don't have the luxury. of saying, oh, we're kind of inventing this thing and we're going to get premiums off the bat. You really have to compete right away. So it just takes that long-term commitment,

both from customers, from government and others, to say that we're going to be really focused on this. There's also this thing about the capital markets in the U.S. that's different from China, which is, as you said, right, like Jenny would tell us that these factories are going to become obsolete in five years anyway. And in China, the way it seems to work is like,

that's just kind of the cycle of how industry is built, right? Like, they scale up really fast. They end up with oversupply. There's a bunch of shakeout of all the companies. Like, I remember back in the day when you and I were working together, who were the biggest solar manufacturers in the world? It was like Yingli and Trina and SunTac. Right.

Like all these names that really don't exist anymore. But now there's a new wave and it's Lonji and it's JA and I don't know who else you could tell me. But the point being, like, that's the natural cycle in China. It's harder to do that in the U.S. Like if you're going to, you know, raise capital for a fact. that's supposed to last 20 years, your investors, be they public market investors or infrastructure investors or whoever, would like to see some degree of certainty for a good chunk of that 20 years.

It was really hard to have that market where you just have this constant churn of capital investment. Yeah, I mean, that also explains sort of the whack-a-mole that you see on these global trade fights that occur when you have factories that start in China, then they go to Taiwan and Southeast Asia, then other parts of Southeast Asia, now they're popping up all over the Middle East and Africa and all sorts of places, you know, with that cycle in mind. But I mean, that's part of what, you know, the loan programs office and the Energy Dominance Council or whatever, that's what DOE has been really effective at, right? They've been trying to find industries like this that they can de-risk and really give some step in in a place where those private capital

markets might not otherwise do so. All right, Scott, this was super fun, and it's great to see you. It's good to see you, too. This is fun. And by the way, before we close, you know, for folks like me that used to work with Shale, you know, I remember I was talking to someone recently about, you know, joking how there's like a commonality of people talking about NPR speak. And among the, well, among, shale for like, among the small army of analysts that you, that you hired and raised through your tutelage, we kind of joke that there's Shale speak because so many of us learned, uh, our matters of, you know, persuasion and presentation styles from you. So it's kind of neat to be, have a comfortable. and get to do this podcast with you. My wife would be horrified to hear that there's an army of people who speak like me. I appreciate it. You're welcome. All right, Scott, thanks.

All right, thank you. Scott Moskowitz is the vice president of market strategy and public affairs at QSells. He's also the chair of the board at SIA. This show is a production of Latitude Media. You can head over to latitude.com for links to today's topics. Latitude is supported by Prelude Ventures. This episode was produced by Max Savage-Levinson. Mixing and theme song by Sean Marquand.

Stephen Lacey is our executive editor. I'm Michelle Kahn, and this is Catalyst.