The U.S. Department of Energy’s (DOE) loan-guarantee program – part of the American Recovery and Reinvestment Act (ARRA) – has had an undeniably positive effect on solar project deployment and equipment manufacturing in the U.S. However, ARRA qualification requirements have often been a source of confusion for developers and manufacturers.

Over the past couple of years, many solar equipment providers have set up shop in the U.S. in order to comply with the ARRA’s Section 1605 Buy American provisions, which impose certain domestic-content requirements on projects backed by ARRA funding. “ARRA-compliant!” quickly became a golden term in product marketing.

Of course, under many PV cell and module manufacturers’ current labor models, cell fabrication and module assembly may not take place under the same roof – or even within the same country.

U.S.-assembled modules may contain cells manufactured abroad, and U.S.-manufactured cells may be integrated into modules produced elsewhere. Which types of modules are eligible under the ARRA’s rules? What about balance-of-system components?

These distinctions are the subject of a decision issued last week by the DOE’s Energy Efficiency and Renewable Energy (EERE) office. The ruling extended a waiver – originally issued Sept. 30, 2010 – that excludes certain types of solar equipment from Buy American rules until Aug. 6, 2011.

The EERE’s decision means that both U.S.-manufactured modules containing foreign-manufactured cells and their opposite – foreign-manufactured modules comprising U.S.-manufactured cells – remain exempt. The ruling also waives so-called ancillary items and equipment, including charge controllers, combiner boxes, wiring and racking equipment, and other items (except inverters and batteries) used in solar installations.More info at

“The Assistant Secretary has determined that application of Section 1605 restrictions would be inconsistent with the public interest for incidental and/or ancillary solar photovoltaic equipment, when this equipment is utilized in solar installations containing domestically manufactured PV cells or modules,” the EERE writes in its memorandum of decision.

“What the DOE has tried to do is live within the spirit of the law, while also allowing companies to make the best market-based determinations they can,” Salo Zelermyer, an associate in the Environmental Strategies Group at law firm Bracewell & Giuliani, tells Solar Industry.

The memorandum explains that complications inherent to multi-site, multi-country PV module manufacturing can make it difficult to determine where “final manufacturing” – for the purposes of ARRA compliance – takes place.

Consequently, the EERE says it teamed with the National Renewable Energy Laboratory to conduct “extensive research” into the nature of solar manufacturing to explore three possible rulings: requiring only domestic module assembly, mandating that both cells and modules be made in the U.S., or allowing either cell manufacture or module assembly to count for compliance.

The third option – the agency’s chosen ruling – “recognizes EERE’s determination that the manufacturing process for cells and the final PV module production represent distinct and significant stages in the solar PV manufacturing chain,” the memorandum says. “Conducting either of these discrete activities in the United States creates roughly equal numbers of American jobs.”

Not surprisingly, Suniva, a Norcross, Ga.-based monocrystalline solar cell manufacturer, immediately spoke out in support of the EERE’s interpretation of “American” modules.

“This is an important step by the Department of Energy to support American companies manufacturing the part of the solar supply chain that contains the highest value and most intellectual property – the cells,” said Bryan Ashley, Suniva’s chief marketing officer, in a statement.More info at

The company, which received a $15 million working capital loan guarantee from the Export-Import Bank Of The United States last November, exports approximately 90% of its annual production to countries in Asia and Europe, according to a 2010 press release.

Zelermyer says that the solar market as a whole – not just Suniva and other firms with an explicit stake in the EERE’s ruling – can expect to benefit from the waiver’s extension.

“This frees up project developers to source their projects according to a more market-based decision, while maintaining the spirit of the provision: supporting U.S.-backed manufacturing,” he explains. “Ideally, when you don’t place constraints on the market, the industry is free to source its components in the most cost-effective manner.”

Zelermyer, who has previously served as counsel to the DOE, says we may or may not see another extension of the waiver when it reaches its Aug. 6 expiration. He predicts that the agency will base its decision on the progress made by existing stimulus-funded projects.

“Most stimulus awards have already been given out, but some larger projects take longer to put into place,” he notes. “Depending on how companies are proceeding with their procurements, we may see another waiver, or the DOE may determine it’s not necessary.”


Željko Serdar
Head of association


CROATIAN CENTER of RENEWABLE ENERGY SOURCES (CCRES)• was founded in 1988 as the non-profit European Association for Renewable Energy that conducts its work independently of political parties, institutions, commercial enterprises and interest groups, • is dedicated to the cause of completely substituting for nuclear and fossil energy through renewable energy, • regards solar energy supply as essential to preserve the natural resources and a prerequisite for a sustainable economy,• acts to change conventional political priorities and common infrastructures in favor of renewable energy, from the local to the international level, • brings together expertise from the fields of politics, economy, science, and culture to promote the entry of solar energy, • provides the opportunity to play a part in the sociocultural movement for renewable energy by joining the association for everyone, • considers full renewable energy supply a momentous and visionary goal - the challenge of the century to humanity. Zeljko Serdar Head of CCRES association
This entry was posted in ALTERNATIVE, ALTERNATIVE ENERGY, GREEN ENERGY, PASSIVE ENERGY, RENEWABLE ENERGY, RENEWABLE ENERGY CENTER SOLAR SERDAR, SOLAR SERDAR and tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s