First Solar CEO: Solar energy is a 'strategic resource'

First Solar CEO Mark Widmar joins Yahoo Finance Live to discuss President Biden’s infrastructure plan and the outlook for clean energy.

Video transcript

AKIKO FUJITA: Well, President Biden is doubling down on renewable energy in his $2 trillion infrastructure bill, calling for a new clean electricity standard with the goal of making electricity carbon-free by 2035. So what does all of this mean for the solar industry? We've got First Solar CEO Mark Widmar joining us today from Arizona. Mark, it's good to talk to you today. Let's start with that goal the president has set forward-- carbon-free by 2035. When we're talking about the electricity grid, how realistic do you think that goal is?

MARK WIDMAR: Look, I think it's very realistic. I think we've proven our stuff in this industry over the last decade. If you look at where we started from, from a resource that was intermittent, uneconomical, and really was only secured solely on the basis of policies for the most part, and obviously, an emphasis on climate change, and we've made this in a short decade become a strategic resource.

It's the lowest cost new generation. We now have the capabilities of enhancing and improving the reliability of the grid with the capabilities of a solar utility scale power plant. We're now starting to see the integration of storage so now you can create firm dispatchable power. So I don't see any constraints moving us forward to hitting that type of objective.

And one of the things I like to say is, you know, we started off a decade plus ago and the industry was looked upon as renewable-- or excuse me-- new or alternative. And now it's mainstream. And so when you think, going forward, what are the new alternative sources of technology, it's EVs or it's hydrogen or it's carbon capture. And all that's going to be powered by renewable energy. Because it's become so mainstream at this point in time.

AKIKO FUJITA: You've heard the president package the spill as an American Jobs Act. But within the industry, there's been a lot of concern about the supply chain and how reliant it is on the Chinese. You yourself have written about this before. Speak to-- talk to me a bit about what concerns you have in terms of how the industry has been laid out and China's dominance largely on the back of subsidies from the government.

MARK WIDMAR: Yeah. If you think about the evolution of renewable energy, it was really this idea of this great liberation to get away from the dependency on oil or fossil fuels or to be dependent upon a cartel or small consortium of countries that could have significant influence as it relates to supply or access or pricing. Wind and solar is an abundant resource. It should create liberation that we should all have the ability to benefit from, which was a great inflection point for not only the US, but for all of nations around the world.

Unfortunately, what's happened is if you look at a decade plus ago, where there was relatively robust diversification, a number of countries and having capabilities not only here in the US, in Europe, in Asia, Japan, in a short decade, that all got decimated with the Chinese approach to wanting to dominate this industry and being heavily subsidized in order to make it happen. As you know, the normal process around their five-year planning process, they have a strategic intent. And they'll heavily subsidize whatever the priorities are in that five-year planning process.

And what's happened now is that the [? crystalline-silicon ?] supply chain-- which I also want to make sure it's clear and understood that First Solar is thin film-- it started off with a disruptive technology. We're the only one who's been able to really get that technology to scale and to be competitive on a global basis. So we don't have the dependency on the traditional supply chain that the Chinese have evolved. But beyond us, 90 plus percent of the supply chain, whether it sits at the module or it sits at the silicon level, is largely coming from China. And so that is going to be an issue that's going to have to be addressed as we move forward here in the US with creating our own capabilities.

AKIKO FUJITA: And where do things stand on that front? If First Solar is able to be largely independent of the Chinese, to what extent are you having conversations with the White House about how the US can be more self-reliant?

MARK WIDMAR: Yeah, we're having them daily. I'm spending a good portion of my time to help educate the new administration in terms of our capabilities and where we sit. When we-- we've made it a significant expansion in our Ohio facility. Our primary factory here in the US is outside of Toledo, Ohio. We tripled the capacity of that facility back in 2019. It was largely on the backdrop of the 201 safeguard tariffs that were put in place. When we made that decision, we actually acquired enough land to expand beyond.

So we sit with land and capability to put another three gigawatts of capacity into our Ohio campus, which will double where we are right now, a little bit more than double where we are right now. And we can do that within the matter of 18 months. What we need, though, is a stable policy environment and an understanding of ensuring a level playing field. The 201, when it first was put in place, and the intent of the 201 was to safeguard the domestic manufacturing industry, which would enable it to invest and not be attacked by dumping from the Chinese.

It lasted-- it was supposed to last four years. It lasted 16 months because it was undermined by an exemption that some others played their political cloud with to pass through an exemption that really undermined the 201 intent. So we've been waiting. And we're ready to go. And we can get a factory into Ohio very quickly.

AKIKO FUJITA: Mark, we hope to keep the conversation going. Certainly a lot more to discuss on this front. But it's good to have you on today. Mark Widmar, First Solar CEO, thanks so much for joining us today.