US regulations have prompted solar companies to halt cooperation with Chinese-affiliated companies, spreading uncertainty over investment in newly built US factories and supply chains. The procurement policies and financial moves of companies including Sunrun remain in focus.
After the US government adopted new regulations limiting the involvement of Chinese-affiliated companies, major solar companies and financial institutions have increasingly moved to halt cooperation with them. This has reportedly frozen investment in newly built factories in the United States and increased disruption and uncertainty across supply chains.
Sunrun has strengthened its policy of limiting procurement from Chinese-affiliated suppliers and is working to prioritize other companies, including First Solar, as alternatives for panel supplies. Palmetto, a North Carolina-based company, has also indicated that it will avoid Chinese-affiliated manufacturers.
With the Treasury Department’s interpretation not yet finalized, banks including Morgan Stanley and JPMorgan are scaling back financing for some projects because of the potential impact on tax credits related to factory costs. Insurers are also tightening underwriting because of the risk that tax incentives could be withdrawn.
Chinese-affiliated solar manufacturers account for most domestic factories, and more companies are seeking to comply with conditions including a minimum 25% ownership threshold, localization requirements and a ban on effective control. As long as Treasury guidance remains unclear, the prevailing view is that these affiliations could determine eligibility for the credits.