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With the Biden-Harris administration ’ s goal of decarbonizing the power sector by 2035 and the economy by 2050 , it ’ s more essential than ever to be able to control the supply chain . Achieving this goal requires us to more than double our solar panel installations . Meanwhile , we ’ ve seen massive delays and restricted supply due to issues with Chinese and Southeast Asian solar manufacturers . Many major players were under investigation for avoiding US tariffs and will begin paying additional import duties in June 2024 , making solar panels more expensive . Investigators have also found that many Chinese solar products are produced using forced labor , these products have since been banned .
Despite challenges from international solar product restrictions , these disruptions present an incredible opportunity to build up the United States solar energy market . We ’ ve seen significant government investment in this initiative . The Biden-Harris administration announced an $ 82 million investment in domestic solar manufacturing , a portion of which will be dedicated to R & D to promote cheaper and more efficient manufacturing methods . Even more astounding , the EPA announced a $ 27 billion grant in the form of the Greenhouse Gas Reduction Fund ( GGRF ). This fund will finance clean energy projects and $ 7 billion will be solely dedicated to expanding residential solar investment to lowincome communities . It ’ s clear that the US government is committed to supporting the development of solar manufacturing .
While the reshoring trend brings numerous advantages to the solar energy market , it is not without challenges . Companies need to carefully navigate factors such as initial investment costs , potential disruptions during the transition , and ongoing operational expenses .
American manufacturers impacted
While your first thought may be the impact on manufacturers of the panels themselves , the solar supply chain disruptions have a furtherreaching impact . MiddleGround ’ s portfolio company Attala Steel Industries is an ideal example . We invested in Attala in December 2020 , and it ’ s based in Mississippi . Attala is a manufacturer and distributor of steel foundation components for ground-mounted utility-scale solar PV installations ; they ’ re known for their high-quality , low-cost materials with rapid response and delivery times . As you can infer , alongside the increased demand for solar panels and further development of the supply chain , the need for installation tools , labor , and support solutions for utility-scale solar projects grows in parallel . Attala is well-positioned to absorb the demand and prides itself on the efficiency of its production processes , but the current landscape is challenging . Despite the government ’ s investment in industry and the push for decarbonization , domestic projects have experienced delays due to the lack of current domestic solar panel manufacturing capacity . This dynamic will be exacerbated when increased tariffs impact Chinese /
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