What’s next for American battery manufacturing

The passage of the Inflation Reduction Act set in motion a nationwide push to reshore clean energy manufacturing. But the recent change in administration has left the industry wary of what lies ahead in a volatile trade environment.  

A group of solar and storage executives recently gathered at the Intersolar and Energy Storage North America conference in San Diego, California, to discuss the opportunities and challenges for manufacturers navigating the present moment. The panel was moderated by Yogin Kothari, the chief strategy officer at the Solar Energy Manufacturers for America (SEMA) Coalition. 

Panelists noted that, without the IRA, domestic production would not be as financially viable; the policy has provided a greater sense of certainty and stability in a volatile trade environment. Companies that previously relied on offshore production have since been able to expand within the States.  

And the bill has attracted international companies of all shapes and sizes.  

“The driving factor to go to America was the IRA, but it was on the sales side,” explained Thomas Gösswein, the CEO of BESS manufacturer Fenecon Inc. Gösswein heads the first international subsidiary of Fenecon International, which originally hails from Germany. “All the products have incentives, and you get those 30% price reductions.”  

Selecting a site for a manufacturing facility also requires significant financial and logistical planning; some companies prioritize access to policy incentives and governmental support, while others opt for regions known for their industrial expertise.  

Gösswein explained that he chose Greenville, South Carolina, as Fenecon Inc.’s new home thanks to its founding-friendly environment. He wanted it to be as straightforward as possible to get the company off the ground.  

The company took a leaner approach by renting space and keeping initial investment low to mitigate financial risk while scaling its battery storage production. 

“Our product isn’t rocket science,” he said. Fenecon takes EV modules from OEMs that include battery management systems and other assets and perform software and hardware engineering to create new storage systems. “It’s like assembling a sandwich or Lego bricks.”  

But panelists expect trade policies and import restrictions to continue shaping manufacturing decisions. While tariffs have made it more attractive to build domestically, companies still face challenges related to raw material costs and equipment sourcing.  

CEO Martin Pochtaruk of solar manufacturer Heliene noted that aluminum prices are rising at home and abroad, further complicating the decision between sourcing materials domestically or internationally.  

Opinions differed on the best equipment sourcing strategies. Though Chinese equipment is often more cost-effective and technologically advanced than domestic materials, the logistical aspects are giving many companies pause. And domestically produced assets are seen favorably from a political and marketing perspective. 

Storage companies are also increasingly recognizing the value of collaboration as the industry expands.  

Panelists emphasized that industry peers should work together rather than view each other as competitors. With policy uncertainty remaining a factor, stable regulatory support and workforce development will be essential to ensuring long-term growth.  

“Your network is everything,” Gösswein said, adding that building a network of community members, political officials and other companies in the industry is critical, as it fosters learning. “Without the network, I wouldn’t have had any chance. Go where you want to go and see everyone as important. You don’t know who you’ll need next.”