OCI to Expand US Solar Plant to 1GW... Expected to Benefit 800 Billion KRW from IRA

OCI US Subsidiary Mission Solar Energy
Self-Supply of Core Material Polysilicon

[Asia Economy Reporter Choi Seoyoon] OCI is strengthening its competitiveness in the U.S. solar power business by expanding its solar module production subsidiary Mission Solar Energy (President Yang Jaeyong), located in Texas, USA, to 1GW.

On the 24th, OCI announced that its U.S. subsidiary Mission Solar Energy will expand its solar module factory production capacity from 210MW to 1GW. With a total investment of $40 million (approximately 57 billion KRW), the product lineup will be expanded from existing residential modules to commercial and industrial modules, producing M10 (18.2cm x 18.2cm) modules, which are high-output and high-efficiency products compared to existing ones. Expansion will begin in the fourth quarter of this year, with commercial production starting as early as the end of 2023.

Starting with this expansion, OCI plans to proactively respond to the growth trend of the U.S. solar market, where continuous demand increase is expected following the passage of the U.S. Inflation Reduction Act (IRA). The Inflation Reduction Act is legislation supporting large-scale investments in renewable energy projects within the U.S. to address climate change. OCI will receive up to approximately $560 million (about 802.5 billion KRW) in module production support benefits over 10 years starting in 2023. OCI expects to gain a more advantageous position in cost competitiveness of module products and expansion of market share in the U.S. market due to the benefits from the Inflation Reduction Act.

With expanded tax benefits under the Inflation Reduction Act, up to 50% investment tax credits are provided for solar installations in the U.S., and U.S. solar demand is projected to grow significantly from 15GW annually in 2022 to about 38GW by 2025. OCI plans to actively respond to the increasing local module demand in the U.S. through this expansion and establish a stable supply chain by self-procuring polysilicon, a key material for solar modules currently produced at its Malaysia factory.

The Malaysia factory produces low-carbon polysilicon through eco-friendly hydropower, securing a competitive edge in carbon neutrality compared to Chinese polysilicon manufacturers primarily relying on coal power. Especially, as demand for modules made from non-Xinjiang polysilicon has recently increased, OCI expects to secure both stable raw material supply and competitiveness of module products.

OCI plans to use the Inflation Reduction Act as an opportunity to expand its U.S. solar downstream business, including module production and solar power generation projects. OCI entered the U.S. solar power market by successfully constructing the world’s largest solar power plant at the time, the ‘Alamo Project (650MWdc),’ in 2012.

Since then, OCI has been recognized for its capabilities in the solar power industry by winning numerous solar projects in major global markets such as the U.S., China, and Korea. Including ongoing projects, the total order volume reaches 2.4GWdc. Currently, through its U.S. subsidiary OCI Solar Power, it is developing a total of five solar power generation projects and one ESS project in Texas, USA, and plans to actively invest based on the abundant experience and know-how accumulated over the past decade.

OCI Vice Chairman Lee Woohyun said, “With the expansion of Mission Solar Energy’s module factory, we have secured product competitiveness in the U.S. solar market,” adding, “In line with the passage of the Inflation Reduction Act and global renewable energy support policies, we will enhance our capabilities in the U.S. solar downstream business and further strengthen our market leadership.”

This content was produced with the assistance of AI translation services.