Supply chain issues could cloud the future of some TVA solar additions

With growing commercial and political support for a greener economy, the solar industry now hoped to find its time and place in the sun.

As demand for solar installations increases, sourcing solar panels to capture the sun’s power is a challenge in the United States, especially since a federal investigation was opened into potential trade violations involving solar panels. purchased from Asian suppliers. Even buying enough land for some of the planned utility-sized solar farms has proven difficult for the Tennessee Valley Authority.

The Solar Energy Industries Association, a Washington, DC-based trade group, said more than 315 solar projects have been delayed or canceled and solar installation for 2022 and 2023 could be nearly cut in half due to string issues. procurement and concerns about the investigation being launched. by the US Department of Commerce.

The delays push back major solar installations planned by TVA and Georgia Power Co., among others.

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“We have set an ambitious goal to have 10,000 megawatts of solar power which demonstrates that we are not just talking about this, we are serious about this commitment,” TVA Chairman Jeff Lyash told the board. directors of TVA this week at a meeting in Young Harris, Georgia. “But we’ve had a few setbacks like others. Some of our projects have been delayed for up to a year to bring them into service due to solar panel availability issues.”

Amid the shortage of supplies, Lyash said costs have also jumped up to 50% for some supplies.

“We have to face that reality,” Lyash said, noting that some projects won’t go live as quickly as originally planned. “But we’re working on it and that doesn’t diminish our long-term commitment to solar.”

Lyash said TVA has already built or contracted for 2,800 megawatts of solar generation, but even buying the land for the large-scale solar farms has been difficult at times. The typical large-scale solar farm that TVA helps develop requires about 1 acre of land for every megawatt produced by the solar panel.

(READ MORE: TVA chooses natural gas, defying Biden’s clean energy goals)

“There are some difficulties in acquiring land as farmers and others are expressing concern about whether this is the highest and best use of this land,” Lyash said.

Staff File Photo / Tennessee Valley Authority Chairman Jeffrey Lyash speaks with the Times Free Press at the TVA Chattanooga office complex on Tuesday, April 23, 2019 in Chattanooga, Tennessee.

The delays are impacting both solar generation under TVA contracts and solar projects planned by local power companies, which have benefited from greater flexibility under the new TVA wholesale contracts for develop part of their own electricity production. In its financial report released Thursday, TVA said “increasing constraints in the solar supply chain, increases in commodity prices and the recent trade policy investigation into solar panel imports have created challenges for the company. US solar industry, threatening project delays, cancellations and price increases”.

The Southern Co., the parent company of Georgia Power, said in its first-quarter earnings report that nearly one gigawatt of its planned solar power projects would be delayed by a year.

Southern Chief Financial Officer Daniel Tucker said Georgia Power has received regulatory approval to push back the installation of solar projects. The postponement to November 2024 applies to five planned solar installations in Georgia that total up to 970 megawatts of capacity, according to the company’s filing with the U.S. Securities and Exchange Commission. That’s enough capacity to power 184,000 homes.

The projects are being developed by Nextera, EDF Renewables and Consolidated Edison under 30-year contracts to purchase power from these facilities. Southern has pledged to reduce its carbon emissions to “net zero” by 2050, in part by procuring large amounts of solar power.

NextEra also said it expects about 2.1 to 2.8 gigawatts of its solar and energy storage projects to grow from 2022 to 2023 in the United States.

(READ MORE: TVA responds to congressional criticism over costs and pollution)

The US Department of Commerce decided earlier this year to investigate whether Chinese manufacturers were circumventing US rules on solar imports from China by shipping components through subsidiaries in four neighboring countries – Malaysia, Thailand, Cambodia and Vietnam – where the panels are assembled for export to the United States These four countries account for more than 80% of solar panel imports, according to the American Clean Power Association.

“This decision has created market uncertainty that threatens the deployment of solar projects in the Tennessee Valley,” Gil Hough, executive director of the Tennessee Solar Energy Industries Association, said in a statement Friday. “This happened when the entire energy market was already suffering from supply, fuel and logistics problems due to COVID and the war in Ukraine. This is causing delays in the two construction projects already under contract and delays in signing new contracts for projects”.

But solar proponents point out that supply chain disruptions slow future solar installations but do not hinder existing solar production.

“The renewable energy sector has been hit by supply chain disruptions like everyone else,” Stephen Smith, executive director of the Southern Alliance for Clean Energy, said in a phone interview. “It’s about slowing down future construction due to supply chain issues, but it’s not disrupting existing capacity. There are no moving parts with solar power and existing capacity is working well. “

Smith said delays and cost overruns for new solar installations will likely still be much lower than what Georgia Power and other Plant Vogtle owners face trying to complete construction of two new nuclear reactors, which will are now years behind the original schedule and now expected to cost over $30 billion.

— Compiled by Dave Flessner

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