First Solar Reveals Final Sale Amount of 2024 Section 45X Advanced Manufacturing Tax Credits
First Solar, has officially announced the final sale amount of Section 45X Advanced Manufacturing Production tax credits generated through the production and sale of solar modules in the United States in 2024. This transaction, initially disclosed on December 11, 2024, represents a significant financial milestone for the Company and underscores the critical role that tax incentives play in bolstering domestic manufacturing and renewable energy production.
The transaction involves the sale of $857 million worth of tax credits, stemming from two distinct Tax Credit Transfer Agreements that were first made public in December 2024. Under the terms of these agreements, a third party has committed to purchasing the credits from First Solar at a rate of $0.955 per $1.00 of tax credits. The agreements encompass a fixed transaction valued at $645 million, which was completed in two separate payments on December 6 and December 30, 2024.
Additionally, there is a variable transaction valued at $212 million in supplementary tax credits, which is expected to be finalized by February 28, 2025. Once the full transaction is completed, First Solar anticipates receiving approximately $819 million in gross cash proceeds.
Mark Widmar, Chief Executive Officer of First Solar, emphasized the importance of the Section 45X tax credits, stating, “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.
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.” His comments highlight the direct correlation between the tax credits and the expansion of U.S.-based solar manufacturing, demonstrating how government policies can be leveraged to strengthen domestic industries and job markets.
Alex Bradley, First Solar’s Chief Financial Officer, elaborated on the financial impact of the transaction, noting, “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. As it relates to the 2024 financial year, we expect a pre-tax impact to earnings of approximately $39 million and a post-tax impact to earnings of approximately $45 million. This is expected to reduce our diluted earnings by approximately $0.42 per share for the year.”
The tax credits being sold are directly associated with the production of photovoltaic (PV) solar modules in 2024 at First Solar’s U.S.-based manufacturing facilities. These include three established factories in Ohio, as well as a newly operational facility in Alabama. First Solar’s manufacturing process is unique in that it is fully vertically integrated, meaning that thin-film wafers, cells, and modules are all produced in a single streamlined process.
This process efficiently transforms a sheet of glass into a fully functional solar panel within approximately four hours. Such an approach ensures quality control and production efficiency while maintaining high levels of domestic content in its products.
Since its inception in 2002, First Solar has positioned itself as a leader in PV solar technology and manufacturing in the United States. It remains the only one of the world’s largest solar manufacturers headquartered in the U.S., distinguishing it from its competitors, many of whom are based in Asia. As the largest solar manufacturer in the Western Hemisphere, First Solar continues to expand its operations.
The Company is on track to achieve 14 gigawatts of annual domestic energy technology manufacturing capacity by 2026. According to a study commissioned by First Solar and conducted by the University of Louisiana at Lafayette, this expansion is projected to support over 30,000 direct, indirect, and induced jobs across the country, contributing nearly $2.8 billion in labor income.
Each of First Solar’s manufacturing facilities plays a crucial role in local and national job creation. Every factory employs more than 800 individuals, with an average manufacturing salary of $80,000 per year. This wage level provides a stable, well-paying career path for many American workers, reinforcing the economic value of clean energy manufacturing. By offering competitive wages and career opportunities, First Solar has become a key player in fostering economic growth and industrial revitalization in regions where its facilities operate.
Beyond the direct employment created within its factories, First Solar’s operations support a vast network of workers across various industries throughout the United States. The Company relies on the contributions of thousands of hardworking professionals, including soda ash miners in Wyoming, silica miners in Michigan, and copper miners in Utah. Additionally, First Solar’s supply chain is deeply intertwined with the American steel industry, with steelworkers in Alabama, Louisiana, and Ohio playing a vital role in providing the necessary raw materials for solar panel production.
Furthermore, glass workers in Illinois, Ohio, and Pennsylvania, as well as woodworkers in Indiana, contribute to the materials required for First Solar’s manufacturing process. The solar industry’s expansion also benefits a nationwide network of truckers, railroad workers, and logistics personnel who ensure the efficient transportation of raw materials and finished products.
By securing significant tax credit transactions, First Solar demonstrates the effectiveness of Section 45X incentives in bolstering domestic solar manufacturing. These tax credits enable companies to reinvest in infrastructure, technological innovation, and workforce development, fostering an ecosystem that is both economically and environmentally sustainable. The Company’s continued commitment to expanding its U.S. manufacturing presence aligns with broader national objectives of energy independence, reduced carbon emissions, and economic revitalization.
The future looks promising for First Solar as it advances toward its goal of expanding production capacity and enhancing technological capabilities. With its robust balance sheet strengthened by this tax credit transaction, the Company is well-positioned to accelerate its research and development initiatives. These initiatives aim to improve solar panel efficiency, reduce manufacturing costs, and increase energy output, ensuring First Solar remains at the forefront of the global solar industry.
As the clean energy transition gains momentum worldwide, First Solar’s strategic investments and financial maneuvering underscore the importance of policy-driven incentives in shaping the renewable energy landscape. The $857 million tax credit transaction not only enhances First Solar’s financial stability but also reinforces its role as a leader in the U.S. solar manufacturing sector.
By leveraging these tax credits effectively, the Company sets an example for other manufacturers seeking to scale operations while maintaining a commitment to domestic production and job creation. Looking ahead, First Solar is expected to continue its trajectory of growth and innovation, fueled by a combination of government incentives, private sector investment, and a steadfast dedication to sustainability. As the demand for clean energy solutions rises, the Company remains at the forefront of providing high-quality, American-made solar technology that will power homes, businesses, and communities for decades to come.
