SolarEdge has closed its 1st transaction for 45X Advanced Manufacturing Tax Credits in the US
This involves the sale of its solar inverters produced at the company’s Texas factory
The $40 million value of this transaction strengthens its liquidity and improves the balance sheet
Israel-headquartered global solar PV inverter supplier SolarEdge Technologies has closed its maiden transaction for the sale of 45X Advanced Manufacturing Tax Credits, which it says were generated by the sale of eligible, US-made inverters in H1 2024.
The total value of these credits is around $40 million, according to the company. It produced these solar inverters at the company’s factory located in Austin, Texas.
SolarEdge Interim CEO Ronen Faier said, “This sale represents an important milestone in the maturation of the §45X credit transfer market and demonstrates the marketability of credits backed by U.S. made inverter technology.”
This sale enhances liquidity while strengthening the company’s balance sheet, said SolarEdge CFO Ariel Porat. He added that this will accelerate its investment in the US solar manufacturing industry.
The US Treasury released the final rules on Section 45X in October 2024, providing investment certainty to the solar PV manufacturing industry (see Final Rules For Section 45X Advanced Manufacturing Production Credit).
SolarEdge’s Texas fab reached a target quarterly run rate of 500 MW of inverter production in Q2 2024. It produced more than 500 MW of inverters in Q3 this year and is expected to ramp production in the last quarter.
The company also produces power optimizers at its US fab near Tampa, Florida. This is SolarEdge’s 2nd US factory that started commercial operations in Q2 2024. It is expected to roll out close to 2 million power optimizers/quarter. It is adding commercial inverter and power optimizer production starting from Q1 2025.
SolarEdge has been undershipping in an attempt to clear mounting inventories, which has been impacting its financials. In January 2024, it announced a restructuring plan to cut jobs. In August 2024, CEO Zvi Lando stepped down and was replaced by the company’s outgoing CFO Ronen Faier on an interim basis (see SolarEdge Chief Executive Officer Zvi Lando Steps Down).
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