News: Photovoltaics
21 February 2025
First Solar announces final sale amount of 2024 Section 45X Advanced Manufacturing Production tax credits
Cadmium telluride (CdTe) thin-film photovoltaic (PV) module maker First Solar Inc of Tempe, AZ, USA has announced the final amount for the sale (announced on 11 December) of Section 45X Advanced Manufacturing Production tax credits generated by the production and sale of solar modules in the USA in 2024 by its operational manufacturing footprint in the USA, including three factories in Ohio and a new Alabama facility.
The transaction for the sale of $857m of tax credits was the result of two separate tax credit transfer agreements announced in December, under which a third party agreed to pay First Solar $0.955 per $1.00 of tax credits. The agreements covered a fixed transaction of $645m of tax credits, paid for in two parts on 6 December and 30 December, and a variable transaction of $212m in additional tax credits, the sale of which is expected to be completed by 28 February. Upon completion of the transaction, First Solar expects to receive gross cash proceeds of about $819m.
“This is a case of the Section 45X tax credits working exactly as they were intended, creating and retaining billions in economic value in our country and supporting tens of thousands of American jobs,” says CEO Mark Widmar. “The value of the tax credits is directly tied to the volume of solar panels produced at our facilities in Ohio and Alabama for deployment in power generation projects across America, the highest volume we’ve produced in the US since we began manufacturing in 2002,” he adds.
“This transaction strengthens our balance sheet even as we continue to invest in our US manufacturing capacity and research and development infrastructure, which are crucial to our growth,” notes chief financial officer Alex Bradley. “As it relates to the 2024 financial year, we expect a pre-tax impact to earnings of approximately $39m and a post-tax impact to earnings of approximately $45m. This is expected to reduce our diluted earnings by approximately $0.42 per share for the year.”
Having manufactured in the USA since 2002, First Solar is the country’s leading PV solar technology and manufacturing company and the only one of the world’s largest solar manufacturers headquartered in the USA. Already the largest solar manufacturer in the Western Hemisphere, the firm is on track to achieve 14GW of annual domestic energy technology manufacturing capacity in 2026, by which time it is expected to support over 30,000 direct, indirect, and induced jobs across the country, representing almost $2.8bn in labor income, according to a study commissioned by First Solar and conducted by the University of Louisiana at Lafayette. Each of its factories employs more than 800 people, with an average manufacturing salary of $80,000 annually.
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