Buy American Act Compliant PV Modules – How to Know?

The US PV industry as a whole is grappling with the solar import tariff petition by Solarworld which presents an interesting set of American made, American protectionist, and

Which Modules are BAA compliant for Government Procurement?

wider global trade issues. A great recap with citations of this complex situation which may result in substantial tariffs on solar PV modules that contain crystalline solar cells made in China can be found here.

Within the US federal agency PV market there is another set of complex American content regulations called the Buy American Act (BAA). (Not to be confused with the now expired and poorly written ARRA Buy American clause which governed rapid release of stimulus funds) The BAA requires that products purchased by the federal government must contain 50% or more US content, with finally assembly done in the US.  It sounds simple, but is highly complex to execute, with numerous contradictory requirements and a number “if this, but not this, then this” situations.

Solar PV modules that are sold to federal agencies fall under the BAA.  Fortunately, when it comes to crystalline PV modules, determining which modules are BAA compliant is slightly less complex.  The following is meant to clarify the basic situation but does not dive down into the many permutations and “what if” scenarios.

Example BAA Compliant Module BOM for Federal Agency Installations

To gauge whether a solar PV module is a fully BAA compliant product, the bill of materials (BOM)   needs to be examined. As the example industry average BOM to the left demonstrates, if the solar cell is not made in the US with final assembly in the US, the module cannot be BAA compliant. This is because the solar cell makes up at least 65+% of the completed module, depending on module design and provider.

While it’s fairly clear from this example which solar PV modules should be BAA compliant, the situation is confused by wording sometimes found in solicitations from US government agencies, such as: “ Products and materials employed to fulfill this project must be Buy American Act compliant but applied in a manner consistent with United States obligations under international trade agreements.” These trade agreements include World Trade Organization Government Procurement Agreement (WTOGPA), General Agreement on Tariffs and Trade (GATT) and other international trade agreements all of whose products are treated equally with American made goods provided certain requirements are met.  A good overview of the laws can found here which includes a list of countries with whom the US has signed agreements. Notably for the PV industry, China is not included.

As there is currently no guidance for which modules comply in which circumstances, it may be helpful to think of the situation in tiers, which prioritize the intent of the BAA act:

Tier 1 BAA Compliant PV Modules: Solar cells are made in the US with US final assembly

Tier 2 Trade Treaty Compliant PV Modules: Solar cells made in treaty country with final assembly in US

Tier 3 Trade Treaty Compliant PV Modules: Solar cells made in treaty country with final assembly in treaty country

This is admittedly a simplified explanation but puts the majority of module companies in easy to understand buckets.

Unfortunately there is no official BAA module list vetted independently under direction from a qualified agency. The US Department of Energy has provided a vetted list of lighting products which meet BAA and performance claims, so that government procurement and industry have a clear guideline on which lighting products are acceptable for a given procurement.  An agency such as DOE or DoD  energy should create a similar vetted list for PV modules, given the expansive planned use of PV in the next 10 years.

This topic is becoming increasingly important as PV systems are deployed in public private partnerships such as PPA, ESPC, UESC and other models where the government buys the energy from the system but not the system itself. This type of procurement puts the onus on the project awardees to self-certify BAA compliant modules with no guidance, oversight or penalties from the procuring agency.

And with many non- trade compliant PV module companies boldly claiming BAA compliance with modules made completely outside the US but with simple junction box installation in the US, now would be the time to put a vetted BAA qualified list in place before the problem escalates both programmatically and publicly.

 

Share this:
Facebooktwitterpinterestlinkedin

Leave a Reply