91ÊÓƵ

A provision included in the , signed recently by President Obama, requires the U.S. Department of Defense to buy solar photovoltaic devices made in the U.S.

But it’s unclear how the provision will affect solar manufacturers in Oregon, where global companies like SolarWorld and Sanyo have contributed to industry growth.

The DOD is the nation’s largest energy consumer. It is now looking at solar alternatives for more than 300,000 facilities, and in war zones where transportation of fossil fuels can be difficult and dangerous.

China accounted for approximately half of the world’s photovoltaic production in 2010, and nearly all of its exports go to the U.S. and Europe. Now the playing field has been leveled somewhat for Oregon solar companies, according to Glenn Montgomery, executive director of the Oregon Solar Energy Industry Association.

“Clean tech is one part of Oregon’s economy that has continued to grow as everything else has shrunk,” Montgomery said. “It is safe to say we’ll see an uptick, economically, from such a policy. The intent behind the provision is economic fairness; whether we achieve it is yet to be determined.”

Annual sales of solar panels in the U.S. total approximately $1.6 billion, an amount that could grow if companies like Hillsboro-based SolarWorld were to capture solar contracts from the DOD. The company is presently working on two DOD projects, one at Pearl Harbor in Hawaii and one at Buckley Air Force Base in Colorado, according to Ben Santaaris, spokesman for SolarWorld.

“We imagine this provision could help us, but it would be some time before any contracting shakes out,” Santaaris said. “There are fewer and fewer solar companies producing their panels on U.S. soil. What this means to our business and Oregon plants remains to be seen.”

The provision could be mere window dressing because the DOD likely would purchase American-made panels anyway, according to John Audley, deputy director of the Renewable Northwest Project. The DOD values communication and access, Audley said, and both can be provided by companies producing panels in the U.S.

The “Buy American” provision for solar may simply be a strike against China, which is drawing fire from U.S. trade organizations. In sent to President Obama in September, U.S. Rep. Earl Blumenauer said that more than 80 Chinese laws, regulations and practices used in the country’s green technology industry violate its membership in the World Trade Organization. The U.S. has since opened a World Trade Organization case against Chinese wind turbine manufacturing subsidies.

Instead of aiding Oregon solar manufacturers, the provision could actually have an adverse effect, Audley said. Some Oregon solar companies rely on relationships with Chinese-based companies, and this provision could draw ire from the Chinese government and strain those ties.

“The short-term impact could be positive for Oregon manufacturers,” Audley said. “The long-term implications of a trade war could make markets outside the U.S. difficult for Oregon companies to access.”

Some critics say the provision doesn’t go far enough. Sanyo North America Corp. operates a wafer production plant in Salem. While some solar companies import or procure wafers and ingots, Sanyo manufactures its components in the U.S., ships them to Japan to be printed, and then ships them back to the U.S. to be assembled. The components of a panel, according to Aaron Fowles, a Sanyo spokesman, should also be considered under the “Buy American” provision.

“At this point, everything we make is made in the U.S.,” Fowles said. “We’re manufacturing in energy markets where these components will be sold. Without these components, you don’t have a panel. We’re working with the Solar Energy Industry Association to petition for a ‘Buy American’ rule that includes ingots and wafers.”

Of course, anything that may increase economic activity or add manufacturing jobs in Oregon is welcome at a time when the state faces 9.9 percent unemployment. Eugene-based Grape Solar, which last month landed a $1 million contract for a DOD project, plans to hire 20 new employees this year, according to company president Ocean Yuan. With this new provision, Yuan anticipates more contracts to come his way.

“We have submitted multimillion(-dollar) quotes for projects at Hawaiian and Virginia military bases,” Yuan said. “All of a sudden, our competitors who are direct importers from China, Germany and Japan are excluded and there are fewer suppliers available to the military. It’s just the beginning.”