Canadian Solar (CSIQ) Inks Supply Deal for 7 GW of Solar Modules
Canadian Solar Inc. CSIQ recently secured an order to supply 7 gigawatts (GW) of its latest high-efficiency N-type TOPCon solar modules to EDF Renewables North America. The modules will be manufactured at Canadian Solar's new factory in Mesquite, TX.
Per the agreement, Canadian Solar is accountable to supply EDF Renewables solar modules for its U.S. project pipeline during the 2024-2030 period. This implies a consistent inflow of revenues for CSIQ over a long period.
Canadian Solar’s Focus on Capacity Expansion
With a proven history of successful manufacturing in Canada, China, Brazil, Thailand and Vietnam, Canadian Solar announced its first U.S. manufacturing facility in June 2023.
The state-of-the-art facility in Texas, which boasts an investment of $250 million, has the capacity of manufacturing an annual output of 5 GW, which is equivalent to almost 20,000 high-power modules per day. The facility is expected to reach commercial operation in the fourth quarter of 2023.
The United States is positioned to exhibit strong demand growth for solar and associated components. Per the report from the Solar Energy Industries Association, the total capacity of the solar industry in the United States is likely to triple by 2028.
In light of such growth expectations, the recent capacity expansion by Canadian Solar is prudent as it would also ease supply-chain disruptions in the solar market and improve delivery times. This is expected to fetch a handful of returns for the company.
Peer Moves
Considering the widening growth prospects, other solar companies that are expanding their production capabilities within the United States are as follows:
Enphase Energy ENPH added an automated line at Flex's factory in Romania in the first quarter of 2023. This line has a quarterly capacity of approximately 750,000 microinverters.
Enphase is also planning to open six manufacturing lines by the end of 2023, adding a quarterly capacity of 4.5 million microinverters. This will bring its total quarterly capacity to more than 10 million microinverters by the end of 2024.
First Solar FSLR recently unveiled plans to construct its fifth manufacturing facility at the Acadiana Regional Airport in Iberia Parish, LA. As part of its expansion plans, First Solar intends to invest up to $1.1 billion in this facility, which is projected to boost FSLR’s solar module manufacturing capacity by 3.5 GW.
FSLR is also on track to expand and upgrade its Ohio Series 6 factories to achieve an additional aggregate annual throughput of 0.9 GW. The additional capacity is expected to come online in 2024.
SolarEdge SEDG is currently planning to establish manufacturing capabilities in the United States by using contract manufacturers and establishing its manufacturing facility.
SEDG expects to ramp up the shipments of inverters from a contract manufacturer's U.S. manufacturing site toward the end of 2023.
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