Solar Manufacturing: The Problem with Canadian Competitiveness
This week, our guest is Paolo Maccario, President and CEO of Silfab Solar. Silfab Solar is a Canadian company headquartered in Mississauga that manufactures solar panels in Ontario, Washington State, and South Carolina. The South Carolina facility will manufacture solar panels and cells with operations expected to be online in the third quarter of 2024. Cells are a critical input to making modules, and the South Carolina facility will be the first of its kind in North America.
Paolo explains that with the significant incentives offered in the US Inflation Reduction Act (IRA), Canada is unable to compete with the United States to attract investment in solar panel manufacturing facilities.
Here are some of the questions that Peter and Jackie ask Paolo: Why have the share prices for publicly traded solar manufacturing companies fallen this year? How has solar panel pricing changed in the past year? Have the US tariffs on Chinese panels resulted in a boost for US domestic manufacturing? How impactful are the IRA incentives for solar manufacturing, both the production tax credit (PTC) and the investment tax credit (ITC)? How do the incentives in Canada compare with the United States? What is the efficiency of solar panels today, and is there room for improvement? How can manufacturers keep up with the rapid pace of technical innovation? What is the state of solar panel recycling? The Canadian government has offered more generous incentives for producing lithium-ion batteries, how do the jobs for manufacturing batteries compare with solar panels?
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Episode 219 transcript.
Speaker 1:
The information and opinions presented in this ARC Energy Ideas podcast are provided for informational purposes only and are subject to the disclaimer link in the show notes.
Speaker 2:
This is the ARC Energy Ideas podcast with Peter Tertzakian and Jackie Forrest. Exploring trends that influence the energy business.
Jackie Forrest:
Welcome to the ARC Energy Ideas podcast. I’m Jackie Forrest.
Peter Tertzakian:
And I’m Peter Tertzakian, and welcome back. Well, actually I think I’ll welcome myself back. I just came back from Europe yesterday afternoon.
Jackie Forrest:
And where were you?
Peter Tertzakian:
Well, I was in Madrid in Spain. It’s a wonderful city. I’ve never been there before. And the arts, culture and the food is just amazing, friendly people, so highly recommended.
Jackie Forrest:
Good. Well, I’ll have to put it on my list. I imagine Spain is sunny.
Peter Tertzakian:
It is. A little bit of cloud, but certainly sunny enough for solar power. And that is, not surprisingly, the subject of our conversation today.
We are delighted to have with us the CEO of Silfab Solar. I’ll mention his name in a minute, but I bet you didn’t know Canada has a solar panel manufacturer of pretty significant size.
Jackie Forrest:
No, I think most of our listeners would be surprised to know that. We think about solar panel manufacturing, I think most of us think of China.
Peter Tertzakian:
Well, and there’s a good reason for that because they are dominant. But we too here in Canada have a solar panel manufacturing company, and to tell us about it is the CEO, Paolo Maccario. Buongiorno Paolo.
Paolo Maccario:
Hey, Buongiorno, Jackie, Peter. A real pleasure to be with you. Indeed, here in Toronto is a lovely sunny day. And indeed, nobody should be surprised about the manufacturing solar panels in Canada, because Canada used to be the largest manufacturer of solar panel in North America, and Silfab the largest manufacturer on the Western Hemisphere, so let’s dispel those surprises.
Jackie Forrest:
Okay. Well, why don’t you tell us, tell our listeners a bit about how you got started and the history of how you became such a large producer here in North America?
Paolo Maccario:
Oh, absolutely. So Silfab’s been producing solar panel and solar projects in Europe now for over 40 years. And around 14 years ago there was a decision that it was time to help North America. That was indeed purchasing most of the modules and the solar panel and the cells from abroad. So, the decision was to start in Canada, mainly because our motto was at the time and continue to be, “First in sustainability,” and we wanted to have clean energy to produce clean solar panels. So, we chose originally Quebec for a silicon manufacturing plant. And that’s the name of the company, Silicon Fabrication. And then eventually we decided to start our first operation for producing solar module in Ontario, not too far from Toronto.
Peter Tertzakian:
Mm-hmm. And you also have manufacturing facilities in the United States and Washington State and in South Carolina.
Paolo Maccario:
That’s correct. There was a point in time in which we could produce the entire annual demand of Canada in a month. So, our major customers are indeed south of the border. The market there is so much larger than initially we started exporting and we continue to export everything we produce in Canada, but eventually we had to expand our operation with two solar plants manufacturing panels in the state of Washington, and now a gigantic one in South Carolina that is going to manufacture both solar cells that is a bit the engine of the solar module and solar module themselves.
Jackie Forrest:
All right. We’re going to come to your moves into the US but maybe we can just provide some context. What percentage of solar panels are produced in China versus North America today? Just to give people a sense of the scale of the North American manufacturing.
Paolo Maccario:
Great question. So, the growth is so huge that by the time I respond, the response will be obsolete. But let’s put it this way, typically there is, last year there were around 75% of the solar panels that were serving the world that were coming from China, while the US was around 3%, so minute.
Jackie Forrest:
All right. And what about the production of the key inputs? Because you kind of had mentioned that you’re assembling modules, but many of the components are coming from other regions of the world. When you look at things like the wafer production and cell production, how much of that occurs in China today?
Paolo Maccario:
Yeah, if you follow the value chain, let’s say the silicon is probably the one that is not as dominated by China, but still China produces 64, 65% of the silicon worldwide using solar. And then when you get to intermediate component like wafers and cells, there is where the danger lies because indeed China currently has over 99% of the production of wafers worldwide, and cell is at 80%. Or I should say that was in 2022. With the fact that there have been a technical evolution on the size of wafers becoming larger and larger, and technical evolution on the type of cells utilized by the industry, those new technology are almost 100% Chinese right now. We are trying to change that at Silfab.
Peter Tertzakian:
So, for the benefit of our audience, let’s just back up a minute and set the technical context of how solar panels, the components. So, silicon is the foundational element, and from silicon you make the wafers, and from the wafers you make cells. Many cells make a panel, and panels make modules. Is that how it works?
Paolo Maccario:
Well, you are correct. We just utilize modules and panels interchangeably, so it’s pretty much the same object. That is what eventually you will have on a large solar farms, connected in an array or on a solar rooftop.
Peter Tertzakian:
So Silfab does what? It does not make wafers, it makes?
Paolo Maccario:
No, we have been making and forever all the components in Europe. Here in North America, currently, we are making solar modules, and the plant in South Carolina will be making solar cells and solar modules, feeding those solar cells to all the other plants of Silfab.
Jackie Forrest:
And will that cell plant that you’re starting up, will that be the first of its kind in North America producing the cells?
Paolo Maccario:
Not only the largest and the first of its kind but is also the first to produce the new technology that we affectionately call TOPCon that is the newest, let’s say, type of engine, the one that generates more electricity, so to speak. So, we will be the first one outside of China to produce TOPCon.
Jackie Forrest:
And we’re going to talk a little bit about cell technology, because it does evolve very quickly, but before we get to that, you had mentioned that you were in Ontario, and I think there’s some advantage in producing product in a place like Ontario with clean electricity relative to maybe China. So maybe you could talk a little bit about that.
And I know you just released your first ESG report. We will put a link to that in the show notes, but I think there’s more details on your ESG advantages within that document as well.
Paolo Maccario:
Yeah, absolutely. And by the way, I just spent the weekend reading your ESG report, the ARC Report. That was quite informative.
And you’re absolutely correct. So, there are advantages in producing in North America specifically and in Canada over importing products from Asia. What you mentioned, everybody knows about the forced labor issues that have been prevalent and found in particular on the silicon value chain in the quartz mining rather than the creation of or the manufacturing of the pure silicon. But there are some additional advantages producing in North America. The production or the carbon footprint of making solar cells and a solar module in China or Vietnam or Cambodia is significantly larger and worse than producing it in North America. Also, that if you had a chance to read, the reports will explain those significant differences. But again, as we are trying to clean the atmosphere, it does make a lot of sense to produce a clean solar module with clean electricity.
Last and not least, I also want to remember that there are additional disadvantages in producing in areas of the world, as your report highlights, that is related to bribing and the general rule or laws that are different in Asia.
Jackie Forrest:
Good, and thanks for mentioning the ARC Financial ESG Report. We can put a link to that in the show notes for our listeners. ARC Energy Research Institute is an integral part of ARC Financial, and we just put out our report too, so we’ll put links to both reports in the show notes.
Peter Tertzakian:
Let’s switch over to the finance side of things for a minute. There’s at least eight other solar manufacturers in North America. You’re private. Some of these other ones are publicly traded. And the publicly traded ones in the stock market, and we talked about this, Jackie, I think in the last podcast or the one before, but a lot of the renewable energy companies or those related to renewable energy, the stock market has not been kind. The solar manufacturers have been down about 25% or so this year.
Paolo, do you have a sense of what the financial markets are thinking about solar and solar manufacturers? Usually when the market falls, it’s just usually a function of resetting of growth expectations. In other words, we’re not expecting to grow as much. What do you sense is going on?
Paolo Maccario:
Yeah, it seems to me like the financial market are certainly recognizing the long-term tailwinds of solar, and you will not find anybody questioning the tremendous exponential growth that solar has been receiving in the past few years and will continue to have in the next few years. It seems like there is some short selling, and there is certainly some trading that is happening right now, and well justified. I would say justifying particular for North America, from a confluence of a few events last year, and let’s talk just about solar panels. Last year, the demand was outstripping the supply. So, the market was growing quite significantly, and everybody was trying to create inventory of solar modules. Everybody was expecting that this year there will be an equal growth, mainly stimulated by the policies of the Biden Administration. And therefore, lots of inventories and also lots of supplier that were looking at finding, let’s say, the easy gold in the United States. And we have seen imports that have been growing for the past year. This year, we are seeing imports that are twice the one that we addressed here. Finding a market that has already saturated with inventory, in a market that is not as strong because some of those policies of the Biden Administration have yet to take hold.
Peter Tertzakian:
So, the resetting of growth expectations of profitability are coming in part from the top line. In other words, some price pressure because of changing supply demand, but also there’s cost pressures in many of the manufacturing industries. Is that also true in the solar business that the costs are rising?
Paolo Maccario:
It is true. It’s not only in the cost from an operational cost, but as I mentioned, there is almost a generational transformation of the technology that requires some significant investment that are happening this year. So, there is, in general, a demand for cash, and there is indeed a significant amount of growth.
Jackie Forrest:
Now, how is this impacting the price of solar panels? I was reading some Bloomberg research that was showing the price per watt is down quite a bit, and I wonder how that ties into this buildout of North American capacity. You’ve announced new capacity in the cell and the manufacturing, but others have as well. Do you think that’s going to slow down how fast some of that new North American capacity comes on because of this pricing squeeze?
Paolo Maccario:
Yeah, there is. Again, for pricing squeeze, you should consider that, mainly due to technology evolution, prices of solar panel tend to drop around 20% every year. And that is just because you generate more electricity with pretty much the same inputs, just improving the technology. But this year, indeed, we had a significant, almost 50% reduction since the beginning of the year. And that one is unusual. Will it affect the amount of installation or manufacturing in the US? Absolutely, yes. So, after the IRA was announced, there were over 100 gigawatts of, for example, module manufacturing capacity announced, a new capacity for the United States. And that is almost three times what the US install on an annual basis. I would say that expecting 50% to go through is probably optimistic, in part because there was an expectation of prices that was not realistic. Let’s realize, though, that that is the purpose of the IRA, the incentive provided were to decrease prices.
Peter Tertzakian:
So, I want to try and understand this just a little bit better. So, technology is driving the cost down, you’re saying cost per watt down by 20% per year. That’s the good news, but the bad news for manufacturers is that they have to spend more money to upgrade their manufacturing processes, and that this is part of the counterbalancing cost escalation. That’s the other thing that you were saying earlier. You had to spend more money to upgrade facilities to keep up with the technological changes. Is that what’s happening?
Paolo Maccario:
It is. Again, when I talk about generational changes, we are talking about significant quantification that happen every 10 years. So, for the past 10 years, we were, for example, utilizing a certain size of wafer and a certain size of cells. As the Chinese became better in producing equipment, and they realized that they can make larger cells and larger wafers and are less expensive. So, everybody should be very happy about that. But it does require changing almost everything. And the same is in the moment in which you can find the technology that allows to squeeze from the photons more electrons. As it is happening right now, there are also evolution that are on the pure processing of that cell. Both of them are happening at this time and have created quite significant increase in installation in China, for example, but all over the world.
Peter Tertzakian:
Yeah, it’s really fascinating because we tend to think about solar panels from a product perspective. The product and the technology are advancing dramatically, but the process innovation has to keep up, and that’s actually costly. And that there’s been a generational change that is happening. Well, in part, the technological locomotive, if you will, is a consequence of policy. And the US Inflation Reduction Act, which you mentioned, Paolo, has been really significant. And Jackie, it’s really affecting all types of renewable energy technologies. So, shall we move on to the IRA?
Jackie Forrest:
Right. Yeah, we want to talk a little bit more now. It’s interesting you’re in Canada, but you are building most of your new facilities, it sounds like, in the United States. So let’s just talk a little bit. Prior to the Inflation Reduction Act, when Donald Trump was president, the United States actually put in large tariffs to increase the cost of importing Chinese solar panels into the United States. So the IRA was not the first policy aimed at trying to increase domestic production of solar panels. Did that result in more growth of domestic manufacturing? And maybe that you could explain, is that why you’ve chosen to put more of your newer facilities into the United States, even before the IRA?
Paolo Maccario:
Yeah. Let’s say that the tariff that have been imposed, especially on China, started in 2012. So tariffs that are impacting or they’re penalizing, let’s say, the unfair trade practice seems to be working. Anti-dumping and countervailing duties have been in place and have been working. The Trump tariffs, at this point, do not work or didn’t work too well. I believe only 2% of the imports are currently paying those kinds of tariffs. And mainly because there has been a way to go around them. So either circumventing by starting to produce product still with Chinese input in other countries or just trying shipping product from China to other countries and changing the country of origin. Or indeed, because the administration has not been particularly wise in opening some exclusion based on product. And some of the product that were excluded from those tariffs are actually the majority of the product that are installed in the United States. So a strong no. The Trump tariff did not work and did not increase manufacturing. That is why they’re now, if the stick doesn’t work, they’re trying the carrot. Indeed, let’s help domestic manufacturing.
Jackie Forrest:
So, considering that, why did you build your manufacturing capacity in Washington State and North Carolina, then?
Paolo Maccario:
Well, there are two aspects to it. First of all, our customer tend to be mainly on the residential and commercial. And they do value not only the quality of the product but also the service that you can provide domestically in customizing the product or in just being able to be there when it’s needed. But the second aspect is because a lot of current incentives in the United States tend to favor domestic manufacturing. So there is a desire, there is a recognition that we cannot be dependent on China. We are more dependent on China in solar right now that we ever were, for example, from Saudi, for oil. And they recognize that, solar being the future, we need to have our own value chain. And so they have created incentive in producing the object. And that is why it’s very important for us to be in the United States.
Jackie Forrest:
Right. And that’s with the IRA, the new incentives that’s kind of really helped boost things. And you mentioned that the tariffs didn’t work because of the circumvention, that they were just kind of moving their manufacturing to other countries. But that’s going to change too. I think it’s in the next year we’re going to see that there’s much more tariffs, and many more products coming in are getting tariffs. Do you think that’s going to be helpful for your US manufacturing?
Paolo Maccario:
It should be. And again, assuming that the border is able to stop that flow, as of June, that circumvention should stop. So, it should be extremely helpful for the domestic manufacturers.
Peter Tertzakian:
Can you talk about the incentives of the IRA that got the switch from the stick to the carrot? What is the carrot as an incentive, and how is it paid to you?
Paolo Maccario:
Yeah. Well, the US is specific in providing two types of incentive. One incentive that is not dissimilar to the Canadian one is a tax credit that provides benefit to our customer in installing solar, but also provide an extra benefit, what we call an adder, if they choose a domestically made product. So extremely important, in particular as we proceed to manufacture in the US. The second type of incentive is probably even more important and is what is called a production tax credit or a PTC; something that we don’t have, and we should have here in Canada. That indeed it does not only provide you tax credit for something or for capital expenditures that you may have now for something that may or may not be in operation down the road, sometimes 10 years from now. But it provides a production tax credit. So, whatever you produce and sell almost in real time, you receive a tax credit. Something that is very important in my opinion also as a taxpayer, because I want those solar projects, I want those hydrogen projects, I want those battery to be happening and to be happening now and to start cleaning the atmosphere not 10 years from now. If they don’t happen, there is no expenditures or no cost to the taxpayer.
Jackie Forrest:
So that direct pay, so it’s not that you’d be able to forego future taxes that you would’ve had to pay, but you actually get cash in the bank account. Is that how it works in terms of those production tax credits?
Paolo Maccario:
It does. The way that is defined in the United States allow you to, let’s say over a 10-year policy period that is almost certain to be expanded, there is a choice that you can make for five of those 10 years to receive direct pay. So literally get a check from the IRS.
Jackie Forrest:
Then after that, it allows you to not pay taxes.
Paolo Maccario:
Yeah. Either to defray the taxes that you pay or, equal important, to sell those credit to somebody else that needed that possibility of different taxes.
Peter Tertzakian:
So in summary, in the United States under the IRA, a solar panel manufacturer gets tax credits for not only building a plant, the capital that goes into building the plant, but also on every panel that is produced. Whereas in Canada, you get only an investment tax credit for building a plant but not for producing.
Paolo Maccario:
Correct. What you said about Canada. In the US, you need to choose either or, so you cannot have them both. So if you choose to have the production tax credit, you need to forego the investment tax credit and vice versa.
Jackie Forrest:
Well, it’s worth talking about that. I think most people are taking the production tax credit because it’s much more meaningful in terms of your return on investment. Maybe just talk about the magnitude of subsidy that you get with option of the tax credit or the production tax credit.
Paolo Maccario:
The production tax credit for a solar module manufacturer or a solar cell manufacturer is almost 10 times what you would be getting from investment credit and is immediate or let’s say the following tax period, so to speak. So, on the cost of a solar module right now, it’s almost 20% of that cost is a production tax credit, so it’s gigantic. On a one-gigawatt solar factory, you may be receiving $30 million under an ITC. But in Canada and the US, you receive more than 10 times that over the next five years if you choose the production tax credit.
Jackie Forrest:
So being that Canada is only offering the investment tax credit, what are your expectations in terms of Canada building any manufacturing capacity in the coming years?
Paolo Maccario:
I’m afraid there will be no additional manufacturing capacity in Canada. Again, it’s a very logical conclusion for every board and every manager that first you go where the market is. I’m glad that Canada is trying to incentivize the local market, but not as much as they should. But also it’s where there is more money, so to speak, to be made for our shareholders. Indeed, the United States is a much better environment right now than the Canadian one. Something has to change in the Canadian environment as well. There is a need to help even from a government procurement to decide that domestic product should be chosen. There was a point in time which Ontario had the courage to reward the choice of domestic manufacturing. Domestic consumption is not happening right now, but hopefully looking what is happening south to the border, the Canadian will realize that they need something similar also here.
Jackie Forrest:
Well, Canada has said very clearly they don’t want to match the IRA in all areas as it’s too costly and they can’t afford to keep up with the US in all of those areas. But are there other things Canada could do that you think would help manufacturing more solar panels here?
Paolo Maccario:
Yes, absolutely. Canada has indeed stated that they will not match dollar for dollar, and it’s actually chosen certain technology and particularly I would say batteries and the small nuclear reactors as their focus. It’s an unusual choice because either from a technical point of view and from a risk point of view, they’re both longer in term of deployment and potentially fraud with technological changes. What we would ask and we ask the Canadian government is, should we consider what is available now? They have created the largest manufacturer of solar panels. Solar panel are in demand right now, so they just should introduce also the solar panel as one of those priority and focus for their programs.
There are some additional things that can be done. Nevertheless, there is no question that stopping product made with forced labor, requesting that customer and border service enforce not only the rules that are in place right now, but enhance provision that are common with the Modern Slavery Act will be important. We need to stop those trans shipment of dump material from China. I believe that production tax credit for clean energy manufacturer, similar to what has been done in the United States, it would be extremely important and not particularly costly. You only pay if that product is produced and sold domestically.
Peter Tertzakian:
Let’s go back to the technology. I’m intrigued by the trajectory of the improvement of solar panel technology. How much of the solar energy that hits a solar panel is converted into electricity? In other words, what is the efficiency of the solar panel today and where do you see that going over the next few years as technology improves?
Paolo Maccario:
There are different technologies already now with higher or lower efficiency, let’s say a good technology like the one that Silfab has, we generate already now close to 22% of that, let’s say transformation, transforming more than 22% of that sun heating the solar panels. The expectation is that we’ll continue. There are some physical limitations, but the creativity of the human mind is almost as good as the laws of physics. So there is certainly an expectation that we will exceed the 30% within the next 10 years, and that is coming from just being able to harvest a different spectrum of the light that currently are not being harvested. So there is improvement as we call in tandem, in which you will be able to have sandwiches of different materials that are already existing right now. This needs to be commercialized and that allow to foster all the different spectrum of light.
Peter Tertzakian:
So 30%, that really starts getting up there and that’s the good news. But again, for a manufacturer who has to keep up, at some point you have to do another generational change. When do you think the next generational step change is coming?
Paolo Maccario:
On the technology side, we would expect another six year of what we are just starting in the United States to be literally the state of the art. Then we would expect that we will start to have those new generation of tandem product.
Peter Tertzakian:
It’s about 160 watts per square meter of solar energy that falls onto the earth on a sunny day. Isn’t that what the number is? About 160 watts per square meter? So to put this 22% into context, so I’m just doing that’s about 35 watts per square meter of solar panel gets converted into electricity, but that could actually go up to 50 plus watts per square meter. Is this the math right, in terms of how that works?
Paolo Maccario:
Yes. So I would expect that we will have on the same size that we have right now, we will have a module that are producing 600 watts. While right now, they’re producing 400, 430.
Peter Tertzakian:
So, what does that mean for the solar industry that did lots of installations even five years ago that say maybe their efficiency was only 15% back then? It’s just moving so quickly that it has the potential to make prior investments obsolete very quickly.
Paolo Maccario:
There is no question that, again, once it is installed, let’s say the cost is there and that particular installation will continue to produce almost forever, I would say. Certainly, more than the 30 years of warranty that is given. So, it becomes an issue of marginal cost to generate it. It’s almost close to zero. But indeed, if you are on a residential solar installation and if you continue to have children that use more and more computers and other form of electricity in your house, and indeed, everybody will start using electric vehicle, there is the possibility that some of those installation that were done five years ago will be better off by replacing the solar panels. That creates an interesting opportunity because the solar panel will keep producing for another 25, 30 years, and there are population around the world that are in need of electricity. No, any kind of electricity, and ideally clean electricity. That is why at Silfab, a lot of those panels that come out from solar rooftop and because they require replacing or donated to population and municipality needs that clean electricity.
Peter Tertzakian:
Well, the whole thing begs some philosophical reflection, in a sense, okay, rooftops are one thing, but if we, say, take 100 acres of arable land and you can get twice as much electricity out of it than you could before because of the technological changes that are happening, how does that influence our thinking about what to do with the installation on that land, Jackie? It’s going to be interesting to see with a lot of these clean energy technologies, as the technologies improve, what all this means as rapid technological cycle in terms of broader sustainability issues, like land use, water use, and so on.
Jackie Forrest:
Well, I think Ontario is actually very interesting because they are getting to the point where they’re looking at repowering, they’re calling it, but basically replacing the wind turbines with new ones that are way better or solar panels that are way better. Now, most of them have gotten to the end of their useful life.
Peter Tertzakian:
But that brings about disposal issues, as well, and recycling issues and so on because the thought was, okay, certainly, when you and I installed solar panels on our roof, you think, “Okay, it’s going to work for 25 years and I don’t have any intention of changing them out,” but if you did prematurely change them out, it accelerates that recycling dynamic.
Jackie Forrest:
Yeah. That’s a good question, Paolo. That is a concern that gets brought up. We’re going to put all these solar panels in the landfill. Think of some of those utility-scale solar plants that we’ve seen and think of how much stuff would go in the landfill.
Peter Tertzakian:
Well, does it go to the landfill, though? Paolo, does it go to the landfill? Do they reclaim the silicon or what happens?
Paolo Maccario:
That’s a very, very important question because, obviously, the desire is to reutilize, reuse that material. Again, still, as I said, many, many years of possible use, but if indeed the decision was to recycle, there are finally some development also that are always spurred by volume. So there was not enough demand, but right now, there are development that are tending to reutilize most of the material. Some are easier than other, and that is also why it’s important to have certain module design for that recyclability. Some of our modules are able to be stripped apart with, for example, the copper rather than the glass, separated easily.
I would say that very, very little is allowed to be landfill. Even if, let’s say, the components of a solar panel you identified at the very beginning of this podcast, that is mainly silicone, none of those components, at least for the silicon-based modules, is offensive from an environmental point of view, but there are other modules that are based on different technology and film that should be kept away from the landfill.
Jackie Forrest:
Okay. So one of the issues is there hasn’t been much to recycle, but it sounds like you’re optimistic that that will be an option as we start to get more and more retirements out in time.
Paolo Maccario:
Yeah. Even in the United States, there have been option in Europe in the past, but again, the US is starting now to finally see the need.
Jackie Forrest:
Well, Paolo, we’re coming to the end of the time with you. It’s been really fascinating. I think one of the takeaways I’ve had is just Canada is quite challenged right now in terms of competing with the US when it comes to solar panel manufacturing. You talked about there’s things we could do, like enforce the modern labor laws that the government has put in in Canada, so that would stop some panels from coming in. But I had a question for you, you touched on it, just a final question. Canada has provided some battery manufacturing facility support for specific facilities. What do you think about that support? Would that be an option in Canada to support specific solar panel manufacturing facilities? And how do the jobs compare for the government? I’m sure they’re looking at jobs for subsidies. Do you think that investing in Canadian manufacturing of solar could provide as many jobs as the battery option?
Paolo Maccario:
Yeah, very, very good question. So, first of all, because some of those battery projects were incentivized utilizing production tax credit, so what I’m recommending for solar has been used for batteries. And as I said, a battery lithium base may or may not be the state of the art five years from now. So, it has a certain level of risk, but utilizing the same policy would be important for solar. And in term of jobs, also, please look at our sustainability report because we have a section on that specifically, but typically, solar generates seven times the number of jobs that storage and batteries generate. Right now, there is certainly a surge of jobs in battery related not necessarily to energy generation or storage, but related to electric vehicles that are not yet used as storage for the grid, but they could in the future, but normally, there is many more jobs in solar than there are on batteries.
Peter Tertzakian:
Well, that’s something interesting to consider because, also, there’s no question, as you talked about in the solar side, there’s going to be generational changes on the battery side. There’s solid state batteries and all sorts of different chemistries emerging that I’m sure Jackie will talk about on subsequent podcasts, but for now, Paolo Maccario, thank you very much. It really has been a fascinating conversation. And for those in Canada that did not know that we had leading solar panel manufacturers here, I hope it’s been an education. So, until next time, I will say arrivederci and wish you well.
Paolo Maccario:
Thank you, Peter. Thank you, Jackie. The sun is shining outside here and the modules are producing electricity. Thank you.
Jackie Forrest:
Great, and thank you to our listeners. If you enjoyed this podcast, please rate us on the app that you listen to and tell someone else about us.
Speaker 1:
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