December 02, 2011

Senate Passes Udall-Schumer 'Buy American' Solar Amendment for Defense Dept.

WASHINGTON - U.S. Senators Tom Udall (D-N.M.) and Charles E. Schumer (D-N.Y.) today hailed the passage of an amendment they sponsored to close loopholes that put American manufacturers of solar technology at a disadvantage to foreign competitors. The Buy American Solar Amendment, which passed Thursday night as part of the 2012 National Defense Authorization Act, will ensure that "Buy American" requirements apply to all photovoltaic (solar) devices that supply power Department of Defense property or facilities. The amendment was also co-sponsored by Sens. Jeff Bingaman (D-N.M.), Sherrod Brown (D-Ohio), Tom Harkin (D-Iowa), Joe Manchin (D-W.V.), Bernie Sanders (I-Vt.) and Debbie Stabenow (D-Mich.).

The Department of Defense is required to comply with the Buy American Act and purchase American-made goods, including solar panels. In practice, however, the Buy American requirements often do not apply to solar projects at military facilities because third-party producers procure, install and maintain solar panels, financed by innovative long-term energy contracts with the department. Since the Department of Defense buys the power, and not necessarily the solar panels, a loophole in Buy American requirements has emerged where the military can purchase power from producers who do not use Buy American compliant panels.

The Buy American Solar Amendment will close this loophole and create a level playing field for U.S. solar manufacturers.

"The Department of Defense is a leader on utilizing solar power-not only for environmental reasons, but for national security reasons by making its facilities less dependent on outside power sources," said Udall. "We are closing this loophole so that the Department of Defense always buys American when it funds solar projects for its energy security. China does not use U.S. solar panels at its military bases, so why should we use theirs at ours?"

"When it comes to charging up the American manufacturing sector and slashing our dependence on sources of foreign power, U.S. defense facilities should be using American-made solar panels in their clean energy initiatives without exception," said Schumer. "The 'Buy American' requirement could not have been clearer, and I'm thrilled that the Senate has closed the loophole that allows foreign solar panel manufacturers to unfairly compete their way into our defense facilities."

The amendment is supported by the U.S. Army and solar manufacturers with significant U.S. operations, including Sharp Electronics, Schott North America, Sanyo North America, Solar World Industries America, Suniva, Konarka Technologies, Kyocera Solar, and United Solar Ovonic. Schott Solar North America operates a significant manufacturing facility in Albuquerque, New Mexico. Despite the tough economic climate, more than 20 new U.S. solar manufacturing facilities have begun operations across America in 2010 and 2011. The U.S. solar industry employs more than 100,000 Americans, and is one of the fastest growing sectors in the economy.

"New Mexico companies, like Schott Solar, will greatly benefit from this amendment. It is also an important investment in our country's homegrown solar businesses," Bingaman said.

It is also supported by the International Brotherhood of Electrical Workers and the Blue-Green Alliance. It maintains all existing provisions of the Buy American Act, which is consistent with international obligations of the U.S. Other nations that provide equal access to their government procurement markets qualify under Buy American, but large solar producers such as China and Malaysia do not qualify.

The Fiscal Year 2011 National Defense Authorization Act attempted to close this loophole, but Department of Defense procurement actions over the last year showed that the provision (Sec. 846 of P.L. 111-383) failed to meets its objective, since it still required the department to become the ultimate owner of the solar device and use it "exclusively" for the "full economic life" of the device. The Buy American Solar Amendment eliminates those loopholes to ensure that the Department of Defense solar project meets "buy American" requirements.

The House-passed National Defense Authorization Act, H.R. 1540, also includes a provision to finally close the loophole.