0:00

Solar is the fastest-growing electricity-generating technology in

0:02

history. It took coal 32 years to

0:05

grow from 100 terawatt hours of generation

0:07

to 1,000 terawatt hours. It

0:10

took fossil gas 28 years, wind was a

0:12

dozen years, and it took solar 8 years

0:14

to hit that milestone. We

0:16

will surpass a terawatt of PV manufacturing

0:19

capacity this year. And that

0:21

scale was the result of squeezing cost reductions

0:23

out of every step of production. But

0:25

there's one critical piece that hasn't changed much

0:27

— frames — which now make up one

0:30

quarter of the cost of a module.

0:32

The one component of a PV module

0:34

that had not seen dramatic reductions in

0:36

cost or performance. We said there's got

0:38

to be a way to do it.

0:40

That was it. Greg

0:44

Patterson is the CEO of Origami Solar. He's

0:46

a former VP at Hewlett-Packard, who got into

0:48

the solar business in 2007. He

0:51

ran an inverter maker and a

0:53

distributed battery developer, both of which

0:55

had successful acquisitions. And four

0:57

years ago, he teamed up with a

1:00

group of fellow solar veterans to focus

1:02

on replacing aluminum with recycled steel for

1:04

frames. We started before COVID. We started

1:07

before Ukraine, before

1:09

any of the geopolitical tensions had gotten

1:11

as high as they were now. And

1:14

as those real-world

1:16

events played out, it

1:19

became clear that aluminum frames

1:21

is an Achilles heel for solar.

1:23

In the years after a pandemic

1:25

and a war pushed aluminum prices

1:27

to historic highs, supply chains for

1:29

all types of imported materials and

1:32

equipment were upended. And America's trade

1:34

tensions with China — a country

1:36

that happens to control nearly 60

1:38

percent of aluminum supply — also

1:40

worsened. The evolution of

1:42

the world around us has

1:44

created such a

1:46

significant risk to

1:49

imported aluminum frames. We saw

1:51

a confluence of these supply

1:53

shocks for solar. I mean,

1:55

we had everything from polysilicon

1:57

shortages, of course, the issues

1:59

with solar. international trade and

2:01

shipping meant that those

2:03

bottlenecks increased shipping costs for solar modules

2:05

as well. MJ Shao is the VP

2:08

of supply chain and manufacturing at the

2:10

American Clean Power Association. That's a trade

2:12

group pushing for policies that support domestic

2:15

clean energy. He worked at a major

2:17

solar manufacturer during that rough time and

2:19

he experienced the mess firsthand. And

2:22

so when there is that

2:24

over concentration of supply,

2:26

then that means when there

2:28

are these policy, trade,

2:31

even just logistical whiplashes

2:33

that are happening, the

2:36

industry becomes far more vulnerable.

2:38

And given the dominant supply

2:40

position globally that China has

2:43

on aluminum, and given

2:45

the rapid growth that solar is

2:47

being tasked to fulfill, we

2:50

realize that this is increasing

2:53

the risk of staying with the

2:55

incumbent. It may sound simple to

2:57

just swap out a different metal for frames. It

2:59

is not. It takes years of designing

3:01

and testing and then convincing manufacturers and

3:04

developers to make the switch. But

3:06

a combination of domestic content rules, new

3:08

tariffs on Chinese metals, reliability problems with

3:11

bigger modules, and a focus on embodied

3:13

emissions of clean energy products are setting

3:15

the stage for a shift in how

3:17

those frames are built. And as it's

3:19

played out, it's like the perfect solution

3:21

at the perfect time. I'm

3:26

Stephen Lacy, and this week we've got

3:28

a conversation I held with Greg Patterson

3:30

of Origami Solar and MJ Shao of

3:32

the American Clean Power Association. It was

3:35

recorded live as part of our Frontier

3:37

Forum series. And we asked, what would

3:39

it take to replace foreign-sourced aluminum with

3:41

US-made recycled steel? And why does it

3:43

matter? This conversation isn't

3:45

just about frames. It's a story

3:47

about geopolitics, trade, the complexities of

3:49

manufacturing, and the urgency of improving

3:52

the reliability of solar. So

4:00

did you start by

4:03

evaluating recycled steel first? How

4:06

did you like tackle the problem initially? Steel

4:08

is a better metal. The thing

4:11

that we had to solve first

4:13

and foremost was corrosion concerns, steel

4:17

rusts, perceptions, aluminum doesn't.

4:20

And aluminum is a really good corrosion solution,

4:23

especially anodized aluminum. But

4:25

we realized that if you could solve corrosion,

4:28

which I'll walk through in detail how we

4:30

did that, as well as

4:32

the weight, because steel is much,

4:35

much denser than aluminum. And

4:37

that's where the design challenge was,

4:39

is how do you really minimize

4:42

to a point of immateriality, the weight

4:45

gain of a steel frame versus an

4:47

aluminum frame? And so, and

4:50

the increasing focus on decarbonizing

4:52

solar, it was

4:54

just a natural with the

4:56

opportunity of the robust regional and

4:59

special domestic recycled steel industry. Because

5:01

recycled steel is the vast majority

5:03

of the steel used in the

5:05

US today and Europe and most

5:07

other regions. And so it

5:09

was a wonderful blend of the

5:11

opportunities and steel's inherent

5:14

fatigue resistance, higher strength.

5:18

It's truly just a better metal than

5:20

aluminum for a steel frame application. So

5:23

we're gonna dig into each of those

5:26

things a little bit deeper throughout

5:28

the conversation. MJ, I wanna roll

5:30

over to you and ask about some of

5:32

these macro trends that we just

5:34

set up. So ACP's mission is to support

5:37

the build out of a

5:39

domestic clean energy industry. You're

5:42

a supply chain expert, worked in

5:44

the industry. You have also

5:46

been an analyst in the industry. What is your take

5:48

on some of the risks that

5:51

I outlined and that Greg outlined?

5:54

You've outlined a lot of the categories

5:56

of risk and I'd also add that

5:59

this is... is an opportunity as

6:01

well for the industry. But as

6:04

far as the risk is concerned, any

6:06

procurement lead out there will tell

6:09

you that a diversity of supply

6:11

options is necessary to ensure that

6:13

you have a resilient, secure supply.

6:17

And the unfortunate reality of today

6:19

for the solar supply chain is

6:21

that there are parts, components of

6:24

the core solar supply

6:26

chain that are heavily dominated

6:28

by manufacturing in China, and

6:30

that makes the industry vulnerable

6:33

to supply shocks. And

6:35

this is a lived experience for the industry.

6:37

And so, I think there's

6:39

an opportunity here too, not

6:42

only just to de-risk that, but

6:44

also, we are in

6:47

the beginnings of a historic

6:49

expansion of US

6:51

clean energy manufacturing capacity. Just

6:55

for solar alone, we've seen 85 new or

6:58

expanded solar manufacturing facilities being announced

7:01

in the US. That's over

7:03

28,000 jobs. That's

7:07

tens of billions of dollars of

7:09

investment in local communities. And that

7:11

is also part of

7:14

the solar industry story

7:16

that I think is really

7:18

exciting too. This is no longer about

7:21

necessarily just buying foreign materials,

7:23

but it's also having solar

7:26

reinvest in the community, not just

7:29

from the perspective of having low

7:32

cost, reliable, clean

7:35

electricity, but also putting

7:37

long-term manufacturing jobs in

7:39

these communities as well. Greg,

7:42

tell me more about what the

7:44

most, the highest value propositions are.

7:47

Tell me about cost comparisons. How

7:50

much are you factoring in like

7:52

emissions and the move

7:54

to factor in embodied emissions and

7:56

the development and purchase of solar

7:59

products? What are the most significant

8:01

value propositions that potential customers are

8:03

interested in? Steel

8:06

frames is a very

8:08

strategic way to de-risk the supply

8:10

chain. It's not the whole supply

8:12

chain for a module or

8:14

for a project, but it is

8:16

material being number two or three on the

8:19

old bomb. And so I

8:22

think if you look at the value

8:24

proposition, it's stacked, but I'd say de-risking

8:26

the supply chain is first and foremost.

8:29

Because when you have

8:31

the existential threat of interruptions

8:34

or arbitrary price increases because

8:36

of tariffs or

8:39

political decisions made on either side of the

8:41

Pacific, that's really

8:43

hard to manage. It's really hard to

8:45

hedge. So that's it. And

8:48

you get a great combo given

8:50

the domestic content that the IRA

8:52

provides in terms of the tax

8:54

credit, you get a material impact

8:57

on increasing your domestic content as

8:59

you de-risk the

9:02

supply chain from Asia. The

9:05

next one that's really starting to play out,

9:07

and this has been coming, I'd say the

9:09

last six to nine months, there's an increasing

9:11

focus on module

9:13

fragility. The

9:17

reality is the size of modules

9:19

have increased over 40%. At

9:23

the same time, there's been cost down

9:25

efforts on both glass and frames to

9:27

reduce the material and thus

9:30

the structural capabilities. And

9:32

so we have this perfect storm

9:36

of cost reduction, the

9:38

core structural elements. At

9:41

the same time, we're seeing more

9:43

and more weather, extreme weather events,

9:45

be it wind, snow

9:48

or hail that is

9:50

requiring a higher performance structural

9:52

support for modules. And

9:55

so with steel frames, we've already

9:57

demonstrated third party tested and we're

10:00

making lots of public

10:02

statements and visibility and talking about it

10:04

all the time. The steel

10:06

frames are higher performance because it's a better

10:08

metal and we've designed a really, really good

10:10

steel frame. And so

10:13

that performance improvement

10:15

to deal with the reality

10:17

of our future solar market

10:19

and environment is key. And

10:22

then finally, it is the decarbonization. When

10:24

we got into it, we didn't realize how

10:27

big it was. We knew it would be material, but

10:29

we never realized it would be a 90% reduction over

10:33

imported aluminum frames. And it's

10:35

not just the transit from Asia to

10:37

the US or Europe. It

10:39

truly is just that aluminum

10:41

is an insanely dirty metal.

10:45

And so the ability to do

10:47

that and the growing focus on

10:49

decarbonizing solar has to lead that.

10:52

And so it truly has been

10:54

an incredible evolution and

10:56

expansion of the value proposition

10:59

over the last four years.

11:01

Especially the first two points, de-risking

11:04

and technical performance, those

11:06

are intertwined as well.

11:09

For example, I was speaking with

11:11

someone earlier this week who had

11:13

dozens of megawatts of modules that

11:15

were broken through tennis

11:17

ball size tail. And

11:21

that in the middle of the current environment

11:23

where there's uncertainty with

11:25

tariffs, there's kind of

11:28

a moving policy with what's

11:30

happening again, non-trade. That

11:33

means that replacing those panels isn't

11:36

a simple exercise of just calling up

11:38

the same manufacturer anymore and there's redesign

11:40

work. So there is

11:43

this interconnectiveness between having

11:46

that resilience of the actual technical module

11:48

as well as of the supply chain

11:50

as well. As we've

11:52

been presenting at conferences and shows

11:54

and to customers and

11:57

just interested parties.

12:01

We're getting anecdotal feedback

12:03

on wind and

12:05

snow damage that is material.

12:08

And so we're seeing all

12:11

the big players, DNV, CEA,

12:14

starting to elevate this concern. And

12:17

so I believe this is an

12:20

emerging and material impact.

12:23

And the cost down dogma is,

12:27

we got to do it selectively. Cost

12:30

is always going to be important, but we got

12:32

to do it selectively. And we now have virtually

12:36

insufficient margin to deal with

12:38

a much more turbulent climate

12:41

future. How did you land

12:43

on this 90% reduction

12:46

in GHD, in body GHD

12:49

emissions in production of these

12:51

frames compared with aluminum module

12:54

frames? This

12:56

was a report that you put together with

12:59

Boundless Impact Partners.

13:04

So tell me about that analysis and the

13:06

actual comparison and how you came to those

13:08

numbers. Yeah, we did. We realized

13:10

that just like with our

13:12

testing results, we want to use third

13:15

parties, very, very credible third parties. And

13:18

Boundless Impact is a very focused

13:21

engineering consulting firm that does life

13:23

cycle analytics. And

13:25

so we basically just told them

13:27

the characteristics of

13:29

our steel frame, and then they

13:31

researched aluminum frames. And

13:34

they developed this. And that

13:36

90% reduction per average

13:38

size module is

13:40

based on their analysis. And

13:43

we've updated it with actually our definitive

13:45

supply chain, and it got a little

13:47

bit better. But it

13:49

really is a rigorous analysis. And

13:55

that 90% reduction, which is a really

13:57

big relative number, translates also to

13:59

a about a 90 kilogram

14:02

carbon footprint reduction per module.

14:06

And if you scale that to

14:08

gigawatt scale, I think it's like 180,000 metric tons of

14:14

carbon avoided per

14:16

gigawatt. And so that is

14:19

absolute materiality if you

14:21

look at it. And so we're

14:23

also working very closely with the

14:25

Ultra Low Carbon Solar Alliance, we're

14:27

members, and they have

14:30

been pushing the EPEAT EcoLabel. And

14:32

we are literally geared up

14:35

and with literally third-party validated

14:38

reductions. What

14:40

we're able to do is provide to

14:42

our customers that buy the module manufacturers

14:45

a absolute data-driven reduction that

14:47

they could go and try

14:49

to achieve the EPEAT criteria

14:52

that I think is gonna become increasingly more

14:55

important going forward. Cause we're seeing a lot

14:57

of attention and focus on

14:59

Ultra Low Carbon and the

15:01

EPEAT standard. MJ, why do embodied

15:03

emissions matter? And of course they matter for

15:06

the planet. Like we should all be thinking

15:08

about the emissions

15:10

from producing products, but are

15:12

companies actually demanding low embodied

15:15

emissions products along the supply chain?

15:17

And where does the policy component

15:19

come in? Like if

15:22

I think about Europe's carbon border adjustment tax,

15:25

why could that potentially influence

15:28

investments in lower embodied emissions

15:30

products? Solar and clean

15:32

energy should really lead on this, right?

15:34

It doesn't make sense if we're, it

15:37

doesn't make sense for a fitness instructor to be

15:40

like, well, I teach other people how to be

15:42

healthy, but I do and eat

15:44

whatever I want, right? So as

15:46

the clean energy industry, we should also be leading on

15:49

this front. But

15:52

beyond that, I mean, that's not convincing

15:54

enough. There are reasons

15:56

why this is becoming important. First of

15:58

all, of the end

16:01

users are starting to look more and

16:03

more into scope three emissions. And as

16:05

they set their carbon reduction

16:07

targets, their net zero carbon

16:09

targets, the embodied carbon

16:12

in their supply chain matters

16:15

more and more and more. So if

16:18

that goes for folks that

16:21

are, whether they're buying the

16:23

modules themselves or they're buying

16:25

the electricity generated from a

16:28

solar power plant, the carbon

16:30

intensity of actually producing that

16:33

solar energy also matters.

16:36

I think secondly that you're seeing it

16:39

as a way for folks either

16:41

to address their trade or carbon

16:43

priorities as well as looking at

16:46

the carbon intensity of supply chains.

16:48

So for example, right now, the

16:51

EU has a carbon border adjustment

16:53

mechanism in place. So for key

16:56

industries, they are actually looking at

16:58

the embedded

17:00

carbon of the importer product

17:02

and if the origin

17:05

or the source of that product doesn't have

17:07

a price or some sort of inclusion on

17:11

carbon in that

17:13

whole market, then they're going to put a tariff

17:15

on it. It essentially is

17:17

a trade mechanism to enforce

17:19

and ensure that the product

17:21

coming into the EU is

17:24

at the same, has the same

17:27

climate standards that they put on their

17:29

own industries. And so this is

17:31

going to be important for anybody that obviously

17:33

wants to trade with the EU

17:35

in those sectors and it's being discussed in

17:38

other places, the US included. So

17:40

that brings us to a bigger policy

17:42

conversation that I suspect a lot of

17:45

people are going to be very interested

17:47

in. And as we

17:49

said, de-risking the supply

17:51

chain is one of the biggest value

17:54

propositions here. And

17:56

I want to reflect on the current

17:58

environment policy. as a

18:00

backdrop to this. So the Biden administration

18:03

recently unveiled new tariffs

18:05

that will cover about $18 billion worth of

18:08

imports under section 301 of the 1974 trade act, Chinese EVs, EV batteries,

18:13

solar modules, steel, and aluminum.

18:16

MJ, give us an overview. What are these

18:19

tariffs designed to do and how

18:21

do we separate them from the ongoing

18:23

ADCVD case on finished

18:25

aluminum products? As

18:28

you say, there's an alphabet soup of tariffs

18:30

here. So help us to sort of understand

18:33

the policy backdrop. It's all my

18:35

line, Steven. But

18:37

yes, there is- I gave you credit for it

18:39

though. Right. There's also the classroom of 201, 301,

18:42

all sorts of numbers of tariffs as well. But

18:48

starting with the section 301 tariffs,

18:50

so just as quick history, these

18:53

were originally implemented under

18:56

the Trump administration, really

18:58

targeting products imported from

19:00

China. They were

19:03

maintained by the Biden administration when

19:06

Biden was elected and these

19:08

were recently refreshed. And

19:11

there are some changes made to what

19:14

was included or raised or added

19:16

to those tariffs as well. And

19:19

it just highlights that

19:22

while there are some of some

19:24

detailed and nuanced differences in policy

19:27

and focus, it's very clear that

19:30

competitiveness with China is a bipartisan

19:32

issue in this country. It is

19:34

going to remain a priority

19:37

for either administration in

19:40

the new year after the election.

19:42

And really the challenge is

19:45

clearly broader than just setting up

19:47

some domestic manufacturing of goods. It

19:49

really is how do we do

19:52

risk and transition the dependence on

19:55

China for many of our supply chains, not

19:57

just solar energy. So

20:00

I think that when you talk about

20:02

focus is really the focus there. In

20:05

terms of its impact on clean energy itself,

20:07

not to toot our own horn here, but

20:12

I think we at ACP

20:15

have been pretty proud of how we

20:17

helped to shape some of the 301

20:19

tariffs that apply to clean energy. For

20:22

example, with our counterparts at SIA, we

20:25

worked really hard with our battery manufacturers

20:27

looking at cells versus module

20:29

manufacturing in this company and

20:32

saw that there was a lag in cells

20:34

and was able to really support a

20:36

case for this delay in non-EV

20:39

cell tariffs going up in

20:42

2026 instead of immediately for EV

20:44

battery cells. And I think

20:47

another thing that's in there that wasn't

20:50

broadcast as much, but I think is really

20:52

beneficial and more relevant to this conversation is

20:54

that there are these exemptions

20:57

for solar

20:59

manufacturing equipment, and that

21:01

is going to directly help a lot of

21:03

the domestic solar manufacturers that

21:06

are buying equipment right now, bringing it into

21:08

this country, and now

21:10

don't have to pay a 25% tariff, which

21:14

reduces the CAPEX and, again,

21:16

increases the competitiveness,

21:18

lowers the cost of domestic

21:20

manufacturing. So I think there

21:24

are good things that are embedded for

21:26

clean energy in these tariffs. I think

21:28

when we look broadly at tariffs in

21:32

general, though, the challenge

21:34

has always been that there's a

21:37

great deal of uncertainty that comes

21:39

with these tariffs. They're not surgical.

21:41

A lot of times the rules

21:44

and regulations don't necessarily allow them

21:46

to provide a lot of visibility

21:48

ahead of time. And

21:50

I think that is something that, for

21:52

example, the Biden administration has been helpful

21:56

in thinking about how do you create

21:58

some transition periods for these

22:00

tariffs. industry. The solar industry, I

22:02

think, is remarkably resilient and able

22:06

to change

22:08

supply chains, but it needs

22:10

the time. And so we've seen that with, for

22:12

example, the two-year tariff moratorium

22:14

on Southeast Asia imports when

22:16

the OXIN investigation was first

22:18

starting up two years ago.

22:20

We saw that with,

22:23

again, this 301, one and a half

22:25

year delay for the sell

22:28

tariffs for batteries, even the Section 201

22:31

tariff. Although there's

22:33

a re-implemented tariffs

22:35

on bifacial module imports,

22:38

there's this 90-day safe

22:41

harbor for contracted goods. So

22:43

again, the signal is clearly to

22:46

de-risk from China to, in

22:48

many cases, help support domestic

22:51

manufacturing, but also allowing the

22:53

buyers, the downstream community, that

22:55

time to transition to for these

22:58

new policies as well. All right, so distill this

23:00

down for me a little bit more. There's

23:03

been this long running debate

23:05

in the industry over whether

23:07

these penalties will hurt

23:09

the domestic energy transition, raise

23:12

equipment costs, create further uncertainty,

23:15

or actually build the

23:17

real domestic industry. How's the

23:19

market reacting right now? What are

23:21

the really key pieces of fear,

23:23

uncertainty, and doubt? Yeah,

23:25

I mean, I think there's a

23:28

spectrum of reactions, right? In general,

23:30

it's the uncertainty that kills. So

23:32

first, the folks that

23:35

are more hedged, that are

23:37

more diversified, they may not

23:40

be feeling the pain as much as folks

23:43

that are over-indexed on

23:45

any particular part of the supply

23:47

chain, right? And that's,

23:49

again, that's always been the challenge is that there

23:53

is the challenge, if there

23:55

isn't a diversity of a supply chain, that these

23:58

whiplashes and policies. can have

24:00

a much greater impact on the

24:03

overall market, starts to feel more

24:05

existential when there is diversity, the

24:08

industry can be more resilient.

24:11

To chime in there, I mean, Origami

24:14

doesn't need the tariffs to build a business

24:16

case. MJ has forgotten more

24:18

than I could tell you about tariffs

24:21

and everything that is dynamically going on. But

24:25

what I will tell you in the last two

24:27

or three months is the aluminum AD CVD case

24:29

and the recent Biden administration,

24:31

Terrace on Steel and aluminum from

24:34

China. My

24:37

sense is talking to everybody and our

24:39

customers are the module makers in the

24:41

US, Europe and actually

24:43

India. It was the wake

24:45

up call and basically

24:48

bumped the need to de-risk because

24:51

the concentration, I mean, in our

24:53

three years of actively engaging the market,

24:56

we found just one crystal

24:59

and silicon module maker that wasn't

25:01

dependent on Asian based aluminum frames.

25:04

So it is 98% of the supply is

25:06

coming out of Asia, most

25:12

of it's China. And

25:14

they're realizing that they

25:16

can't manage the risk because when you have

25:19

the unpredictability of tariffs

25:22

and trade issues and tensions

25:24

across the Pacific, there's

25:27

no good way to hedge that risk.

25:29

And the beauty is with steel frames,

25:32

we can scale. We can scale

25:34

and there is no constraints, material

25:37

constraints with the

25:39

supply chain that we've put in

25:41

place. And so we can drive

25:43

a solution that brings a lot

25:46

of ancillary values like

25:48

domestic content, higher performance and lower

25:50

carbon. But

25:53

it's been amazing how we're

25:56

engaging with the market and

25:58

the vibration has grown dramatically. in

26:00

the last three months, just saying, this is a problem

26:02

we got to solve and solve quick. So

26:05

on the developer-installer side,

26:08

Greg, what are the

26:10

big questions people have? I'm sure they want

26:12

to know about corrosion. You know, you've just

26:14

gone through corrosion and load testing. So

26:17

what are the sources of uncertainty around

26:19

a new product? We are

26:21

actively engaging with all the big EPCs,

26:23

developers, asset owners, and we're actually at

26:25

CBA last, I think it was last

26:27

week. Really

26:29

trying to get everybody aware of the

26:32

value proposition of steel frames, get their

26:34

questions answered. And if

26:36

I just unpack this, the

26:39

EPCs love the

26:42

improvement in performance. We've

26:45

gotten lots of stories about how many modules are

26:47

broken just installing them

26:49

on trackers. And the

26:51

ability to give them a more robust

26:54

frame, that is, as one

26:56

said, doesn't feel like a pool noodle. It

27:00

is very, very, very

27:02

positively received. They're

27:04

concerned about the weight, but we can solve that. We walk them

27:06

through the exact increase in weights and

27:08

they say, okay, that's not an issue. And

27:11

so from an EPC perspective, we're getting

27:13

tremendous thumbs up on how a higher

27:16

performance steel frame can

27:19

improve the ability to get projects in the ground.

27:23

On the developer side, very excited

27:25

about the domestic content, surprisingly excited,

27:27

don't know how to monetize, but

27:29

surprisingly excited about the decarbonization, because a

27:31

lot of their money is coming for folks

27:33

that make that a priority. But

27:35

they're interested. They want to understand corrosion.

27:37

They're very excited about our performance issues

27:40

with weather, but corrosion. And so we're

27:42

spending a lot of time walking them

27:44

through why the

27:46

zinc aluminum magnesium coatings that

27:48

I'll shorten to ZAM, as

27:51

I talk about it more, it's been

27:53

around for decades. And it's

27:55

got industry experience

27:58

that gives everybody comfort. and a

28:00

whole library of third-party independent corrosion testing.

28:02

And we've been doing it, they've been

28:05

doing it. And so the

28:07

corrosion issue we have to address,

28:10

but we've never not gotten past that

28:12

as we get everybody educated. And

28:15

so the benefit there, and

28:17

as everybody starts internalizing, you

28:19

know, fragility issues as the cost down

28:22

on thinner glass and

28:24

smaller frames that

28:26

fundamentally reduce the

28:29

ability to withstand weather, this is one

28:31

of the main ways that this could

28:34

be solved. Also, just

28:36

talk about the difference in weight,

28:38

does that impact the performance of

28:40

trackers with a heavier frame? We've

28:42

talked to virtually every major tracker

28:44

company, and the increase

28:46

in weight is basically the

28:48

conclusion it's immaterial. There's more

28:51

project and site-related variables than the

28:53

weight gain that has

28:55

to be addressed. So it

28:57

truly is not a problem.

28:59

We're competing with aluminum, which

29:01

has got 60 years of

29:04

run-out to do. So there

29:07

are ways that we're going to improve

29:09

steel frames over time, both

29:12

in terms of cost, performance, and

29:15

optimizing things like weight that

29:18

will be showing up literally within a year

29:20

or two. MJ, we're going to

29:22

surpass a terawatt

29:24

of manufacturing capacity

29:27

globally. Talk about the complexities

29:29

of dropping a new frame

29:32

design into that very large

29:34

sector, and then I'll get Greg

29:36

to respond. Well, the

29:38

complexity is, you know, getting

29:41

folks to adopt something new at this

29:43

point. There's a lot of incumbency.

29:47

There's a lot of folks that feel

29:49

like, hey, this is something that

29:51

works and needs

29:53

to be shown, as I'm sure Greg and

29:55

his team are doing, the

29:59

data and the data. analysis that

30:01

shows that this is a superior

30:03

solution, both in terms of performance

30:05

but also cost, because the

30:08

cost pressures are still incredibly

30:10

prevalent in the industry as

30:14

a whole. That being said, I do

30:16

think that solar has always been

30:18

an industry that

30:20

when there is a

30:23

superior solution, it doesn't take long for

30:25

folks to start to adopt

30:27

and realize and try to adopt

30:30

it because they need to also respond

30:32

to those competitive pressures as well.

30:35

One thing that I think will

30:37

be exciting to watch too is

30:40

that something like origami solar with

30:42

a new technology, new

30:44

way of doing something, at the

30:46

same time ramping up as US

30:49

manufacturing as well, I

30:52

think that is something that will be, again,

30:54

exciting to watch because it's historically

30:57

been challenging for a lot

31:00

of the designs, a lot of the thoughts, a

31:02

lot of the US specific challenges

31:05

to be addressed when the manufacturing is

31:07

8,000 miles

31:09

away and the people that are designing

31:11

it are not in the

31:14

fields looking at US

31:17

specific topologies, climate issues,

31:19

hail damage. This

31:23

ability to have local manufacturing

31:27

for technology innovators in the

31:29

US to first of all be able

31:31

to visit a facility

31:33

down the road instead of 8,000 miles away requiring a visa

31:39

is going to help in terms

31:41

of accelerating the cost

31:43

down, the performance gains for those

31:45

innovations as well as help be

31:47

able to commercialize these innovations much

31:49

more easily. So I think that's

31:52

one of the really good knock

31:55

on effects of having local

31:58

manufacturing ecosystem build up. as well.

32:30

We have a lot of different types of framing

32:32

cell automation to be able to put the

32:34

frames on laminate. And they

32:36

sure don't want to have to go to market and

32:38

try to develop new standardized installation

32:40

methods on any segment

32:42

residential through utility. So

32:44

our design was absolutely developed

32:48

to make it a seamless transition. And

32:50

so that nobody's really going to see or

32:52

notice the difference between the aluminum frame

32:55

they mounted yesterday and the

32:57

steel frame they mount today. And

32:59

I also see the strategic benefits in

33:01

my 40 years of business and engineering

33:05

that when you get closer to your

33:07

customers, just like the automotive industry

33:09

did, when back in the 70s and 80s

33:11

when the European and the Asian, primarily

33:17

Japanese auto companies came to the US, they

33:20

got intimate with the market needs. And

33:22

I believe that'll happen as

33:24

we create regional supply

33:27

chains. You'll be able to understand exactly

33:29

what each region does because Europe and

33:31

the US and Asia and India are

33:34

all going to be really, really different markets

33:37

in terms of what you really need to solve.

33:40

We have another example of

33:42

a solar technology that has

33:45

been reshored and that is trackers. And

33:48

steel has been critical for the growth

33:51

of that industry. Greg, any corollaries

33:54

to the tracker market? Like

33:57

can module frames follow trackers? There's

34:01

absolutely similarities. One,

34:05

it's the proof buying that says how quickly

34:07

you can reshore and create the local

34:09

jobs and economic upsides without

34:11

any material negatives for the solar

34:13

industry. And in

34:15

fact, reshoring and using steel

34:19

accelerates and increases confidence in project

34:21

development and construction by

34:23

shortening the supply chain materially without

34:25

concerns about logistics costs or uncertainties

34:28

in delivery. And given

34:30

the bottlenecks we have continued to have

34:32

on all the ports and with the

34:35

random aspect of customs

34:37

quarantine, it gives confidence.

34:39

It actually improves

34:41

the execution in the region.

34:45

But the one difference between us and

34:47

the tracker company is that

34:49

we are taking advantage

34:52

of a material cost difference. We're

34:54

not just reshoring the same material

34:56

to the US.

34:58

We're actually reshoring using

35:01

domestic steel, which has traditionally

35:03

been about the cost of

35:05

aluminum. So we

35:07

get to bring in a new

35:10

metal, reshore

35:12

the production of that, build

35:14

the worldwide global competency center for it

35:16

here, instead of following

35:18

and hoping to leverage from the Chinese. But

35:22

how do we do that? And we can

35:24

do that because of the inherent benefits and

35:26

cost effectiveness of steel. We can do that

35:28

at parity and eventually materially lower cost without

35:31

sacrificing the performance and

35:34

the decarbonization that

35:36

comes with aluminum. I

35:38

want to just add here, on the tracker

35:40

side, if you talk to some

35:42

of the leading tracker players, they

35:44

had these plans to onshore more

35:48

manufacturing here before something like the

35:50

Inflation Reduction Act was even passed,

35:53

just for all the reasons that

35:55

Greg just talked about, carbon, logistics,

35:57

bringing supply closer to demand.

36:01

And then, of course, you add

36:03

the federal tax credits in the Inflation

36:05

Reduction Act, and suddenly, that

36:08

just accelerates everything. And similarly,

36:11

we've seen the same things for solar modules

36:13

as well. MJ, you

36:15

talked about some of the reshoring

36:18

generally that's happening in the US. I

36:20

guess just a blunt

36:22

question on that. Are domestic content requirements

36:24

working? How are they working? Yeah,

36:26

I mean, specifically focused on

36:29

the domestic content bonus credit

36:31

for the ITC, PTC, and

36:33

the Inflation Reduction Act talk

36:36

about more alphabet soup here.

36:38

I think we've had more clarity just in

36:41

the past couple of weeks with some additional

36:43

guidance that's out from Treasury. There's

36:45

this new elective safe harbor option that

36:50

really gives kind of certainty of values

36:52

that the tax equity community has really

36:55

been looking for. So as a result,

36:57

we do think that there are projects

36:59

that are going to be moving

37:02

forward as a result. It's

37:04

a step in the right direction, though. There's still a

37:06

lot of things that need to be fixed in

37:09

certain that Treasury and the folks that are

37:11

helping them pull together this, to

37:14

pull together a proposal

37:16

in the future are thinking about.

37:19

But one of the challenges is that right now, it's a

37:22

static table. It

37:24

doesn't really contemplate many

37:27

of the exciting innovations that are going

37:29

to come, whether it's things like tandem

37:32

solar cells or even just what origami

37:34

is trying to introduce to the

37:36

market. Right now, the values

37:39

are based off of a standard aluminum

37:41

frame. Well, what if origami brings something

37:43

different to the table? How is that

37:45

being looked at independently of the incumbent?

37:48

So those are some of the improvements

37:50

that we'll continue to work on with

37:52

the industry and with the folks in

37:54

the administration to try to solve

37:57

and really help domestic

37:59

content. reach its full potential.

38:01

And Greg remind us, how does the module frame

38:04

play into the domestic module

38:06

content tax credit? Well, it's material.

38:09

The only thing bigger, like I

38:11

say, let's say we're a tie with a glass. The

38:14

only thing bigger is the solar cells.

38:17

And so if you look at what

38:19

is the easiest low hanging fruit to

38:21

drive a material increase, it's

38:23

the frame. And shifting to steel

38:25

frames gives you all the ancillary benefits I've

38:27

mentioned. But it is material.

38:30

And I can't tell you how many

38:32

customers that we're talking to. And

38:36

they're telling the procurement team,

38:39

I need more domestic content. Get this

38:41

done. Because it's important

38:43

to their customers, the developers, ultimately

38:45

asset owners, et cetera, that

38:48

really want to take advantage of

38:50

that. The playing field is not

38:52

exactly fully clear, as MJ mentioned.

38:55

But the trend and the

38:57

strategic intent of that domestic

38:59

content is playing

39:01

out in terms of real decisions

39:04

and motivations on how do we drive

39:06

that domestic and reshoring effort.

39:09

So to wrap up with a big picture question, in

39:13

your op-ed Greg, you

39:15

asked a really simple question, which was, so

39:18

are we serious? Are we committed

39:20

to building a safe, secure, and

39:22

transparent domestic supply chain? Are we

39:24

serious about decarbonization? Are we

39:27

serious about shoring up our immense

39:29

vulnerabilities? When you ask, are we

39:31

serious, who are you referring to? Well,

39:34

it truly is the module manufacturers,

39:36

but it links to virtually the

39:38

entire industry, the people that are

39:40

going to be building these large

39:42

projects. They've got to

39:44

be, as I look, think about it, solar

39:47

has to mature the

39:49

hell up, if I use that term. If

39:52

we're going to be the backbone of the future grid,

39:54

which is what everybody believes is the right answer, we've

39:57

got to really understand. literally

40:00

how will it perform? So

40:03

we're asking the entire industry. And

40:05

to a degree, we're asking the

40:07

questions that says, can you scale

40:10

to be the backbone, first and

40:12

foremost? Two, will you deliver over

40:14

the long haul the performance you

40:16

need to be that backbone? And

40:19

are we gonna get really serious? Like MJ

40:21

said, I view the

40:23

carbon content as a brand

40:25

tarnisher. And we gotta

40:27

get out of that brand tarnishment

40:30

effort. And so we have to

40:32

get the entire industry aligned. But

40:35

the ancillary benefits that come with

40:37

these questions and the shift, not

40:39

just in frames, but across the

40:41

entire solar supply chain and technology

40:43

suite, it is we will

40:46

have a more robust, scalable,

40:48

higher performing energy

40:50

grid. And that's what we're looking for.

40:53

And so it's to the entire industry

40:56

that ultimately has to rally

40:58

around these fundamental questions. Whether

41:00

we're serious or not, we have

41:02

to be. Because these pressures are

41:05

just going to continue to come

41:08

at the industry. I think just from

41:11

looking at the past few years, there's

41:14

a much more serious engagement on

41:16

the topics of supply

41:19

chain diversity, security, being

41:22

able to know that we control

41:24

our own IP and destiny. That

41:28

is the direct result of all the

41:31

supply chain shocks that have

41:33

happened over the past few years. I

41:36

also think there's a level

41:38

of seriousness and maturity that we're

41:40

forced to take now. Steven,

41:43

Greg, I think we all join the solar

41:45

industry probably around the same time, probably

41:48

at this point, have close, if not more than

41:50

two decades in the industry. And

41:52

I feel like for so long in our

41:54

careers, we're always like, well, when is solar

41:56

gonna be at the adult table? We're always

41:58

at the kids' table. is the technology of

42:00

the future. Well, we're becoming the

42:03

technology of the now, which is in

42:05

some ways great, but it also means

42:07

that we are at the center of

42:10

policy, politics, big

42:12

forces, macroeconomic tensions,

42:14

macro trade tensions.

42:17

This is all centered around solar

42:19

because it is the technology

42:22

of the future. And so if we

42:24

aren't serious, then we don't have a

42:26

future. So I

42:28

think we're getting there. There's still

42:30

a lot of work, both for

42:32

policymakers, industry, all the stakeholders

42:35

around. In

42:37

some way or another, we're gonna force we get there. If

42:40

I'd summarize, there is no energy

42:42

transition without energy independence.

42:45

And there is no energy

42:47

independence without robust decarbonized domestic

42:50

supply chains. That's the

42:52

logical progression to me. There

42:54

you have it, a very

42:57

good wide ranging conversation about

43:00

these macro changes in the solar industry as seen

43:02

through the lens of the PV

43:04

module frame. And that was Greg

43:07

Patterson, who is the CEO of Origami

43:10

Solar. Greg, thank you so much. That

43:13

was great, Steven. I really appreciate that. And MJ,

43:15

I'd love hanging out with you. Anytime.

43:19

And MJ Shao is the VP of

43:21

supply chain and manufacturing at the American

43:24

Clean Power Association. Thank you, MJ. Thanks

43:26

for having me. This conversation was

43:28

recorded live as part of Latitude

43:30

Media's Frontier Forum with Origami Solar.

43:33

This was a lightly edited version

43:35

of the conversation. If you wanna

43:37

watch the full video, head on

43:39

over to latitudemedia.com/events and click

43:41

watch recording. And if you

43:43

wanna read some additional coverage about the transition to

43:45

recycled steel, we've got some links in the show

43:47

notes so you can follow up and do some

43:49

reading of your own. Thanks for

43:51

listening. I'm Steven Lacy. Thank

43:55

you, continue

44:00

you