US battery and solar factories surged last year

Washington D.C. Correspondent
Source: 2024 Sustainable Energy in America Factbook, Bloomberg NEF and The Business Council for Sustainable Energy.

Battery and solar factories are driving the build-out of domestic cleantech manufacturing in the United States following the passage of the 2022 Inflation Reduction Act, a new report by Bloomberg NEF and the Business Council for Sustainable Energy shows.

Despite headwinds posed by high interest rates, supply chain disruptions, permitting and grid connection challenges, the number of announced cleantech manufacturing facilities in the U.S. continued to rise throughout 2023, primarily thanks to the IRA.

The law has so far doled out more than $50 billion in tax credits, loans and grants to boost domestic clean manufacturing, including $30 billion in tax credits specifically to ramp up the solar, wind and battery sectors, according to the Blue Green Alliance.

By the end of 2023, the number of factories planned in response to the law rose to 104 total, drawing over $123 billion in investments. Solar and batteries dominated with 34 factories each, followed by 14 each for wind and electric vehicles, seven for electrolyzers and one mining facility.

With $303 billion in clean energy spending, the U.S. was the second largest investor in the energy transition in 2023 after China, which spent more than twice that amount, according to the report.

The clean energy transition is now “hardwired” into the U.S. energy economy, with federal policies sending clear signals to the market, and the market responding in kind, Lisa Jacobson, the council’s president, said at a press briefing about the report in late February.

To meet climate goals though, Jacobson said the U.S. will need to iron out the permitting and infrastructure challenges holding it back.