Solar Energy Manufacturing for America Act

II 117TH CONGRESS 1ST SESSION S. 2140 To amend the Internal Revenue Code of 1986 to establish the advanced solar manufacturing production credit. IN THE SENATE OF THE UNITED STATES JUNE 21, 2021 Mr. OSSOFF (for himself, Mr. WARNOCK, Mr. BENNET, and Ms. STABENOW) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Code of 1986 to establish the advanced solar manufacturing production credit. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Solar Energy Manufac- 4 turing for America Act’’. 5 SEC. 2. ADVANCED SOLAR MANUFACTURING PRODUCTION 6 CREDIT. 7 (a) IN GENERAL.—Subpart C of part IV of sub- 8 chapter A of chapter 1 of the Internal Revenue Code of 9 VerDate Sep 11 2014 06:34 Jun 24, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S2140.IS S2140 kjohnson on DSK79L0C42PROD with BILLS 2 •S 2140 IS 1986 is amended by adding at the end the following new 1 section: 2 ‘‘SEC. 36C. ADVANCED SOLAR MANUFACTURING PRODUC- 3 TION CREDIT. 4 ‘‘(a) IN GENERAL.— 5 ‘‘(1) ALLOWANCE OF CREDIT.—There shall be 6 allowed as a credit against the tax imposed by this 7 subtitle for any taxable year an amount equal to the 8 sum of the credit amounts determined under sub- 9 section (b) with respect to each solar component 10 which is— 11 ‘‘(A) produced by such taxpayer, and 12 ‘‘(B) during the taxable year— 13 ‘‘(i) sold by the taxpayer to— 14 ‘‘(I) an unrelated person, or 15 ‘‘(II) a related person for the use 16 of such person in their trade or busi- 17 ness (with the exception of any trade 18 or business related to resale of such 19 solar component without any subse- 20 quent modification, assembly, or inte- 21 gration into a project), or 22 ‘‘(ii) placed in service or operation by 23 the taxpayer or any other person. 24 VerDate Sep 11 2014 06:34 Jun 24, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S2140.IS S2140 kjohnson on DSK79L0C42PROD with BILLS 3 •S 2140 IS ‘‘(2) PRODUCTION AND SALE MUST BE IN 1 TRADE OR BUSINESS.—Any solar component pro- 2 duced and sold by the taxpayer shall be taken into 3 account only if the production and sale described in 4 paragraph (1) is in a trade or business of the tax- 5 payer. 6 ‘‘(b) CREDIT AMOUNT.— 7 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 8 the amount determined under this subsection with 9 respect to any solar component shall be equal to— 10 ‘‘(A) in the case of an integrated module, 11 an amount equal to the product of— 12 ‘‘(i) 11 cents, multiplied by 13 ‘‘(ii) the capacity of such module (ex- 14 pressed on a per direct current watt basis), 15 ‘‘(B) in the case of a photovoltaic cell, an 16 amount equal to the product of— 17 ‘‘(i) 4 cents, multiplied by 18 ‘‘(ii) the capacity of such cell (ex- 19 pressed on a per direct current watt basis), 20 ‘‘(C) in the case of a photovoltaic wafer, 21 $12 per square meter, 22 ‘‘(D) in the case of solar grade polysilicon, 23 $3 per kilogram, and 24 VerDate Sep 11 2014 06:34 Jun 24, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S2140.IS S2140 kjohnson on DSK79L0C42PROD with BILLS 4 •S 2140 IS ‘‘(E) in the case of a solar module which 1 is not an integrated module, an amount equal 2 to the product of— 3 ‘‘(i) 7 cents, multiplied by 4 ‘‘(ii) the capacity of such module (ex- 5 pressed on a per direct current watt basis). 6 ‘‘(2) PHASE OUT.— 7 ‘‘(A) IN GENERAL.—In the case of any 8 solar component sold after December 31, 2028, 9 the amount determined under this subsection 10 with respect to such component shall be equal 11 to the product of— 12 ‘‘(i) the amount determined under 13 paragraph (1) with respect to such compo- 14 nent, as determined without regard to this 15 paragraph, multiplied by 16 ‘‘(ii) the phase out percentage under 17 subparagraph (B). 18 ‘‘(B) PHASE OUT PERCENTAGE.—The 19 phase out percentage under this subparagraph 20 is equal to— 21 ‘‘(i) in the case of a solar component 22 sold during calendar year 2029, 70 per- 23 cent, 24 VerDate Sep 11 2014 06:34 Jun 24, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S2140.IS S2140 kjohnson on DSK79L0C42PROD with BILLS 5 •S 2140 IS ‘‘(ii) in the case of a solar component 1 sold during calendar year 2030, 35 per- 2 cent, and 3 ‘‘(iii) in the case of a solar component 4 sold after December 31, 2030, 0 percent. 5 ‘‘(c) DEFINITIONS AND OTHER RULES.—In this sec- 6 tion— 7 ‘‘(1) SOLAR COMPONENT.—The term ‘solar 8 component’ means any property described in para- 9 graph (2). 10 ‘‘(2) OTHER DEFINITIONS.— 11 ‘‘(A) INTEGRATED MODULE.—The term 12 ‘integrated module’ means a solar module pro- 13 duced by a single manufacturer through the 14 conversion of a photovoltaic wafer or other 15 semiconductor material into an end product 16 which is— 17 ‘‘(i) suitable to generate electricity 18 when exposed to sunlight, and 19 ‘‘(ii) ready for installation without ad- 20 ditional manufacturing processes. 21 ‘‘(B) PHOTOVOLTAIC CELL.—The term 22 ‘photovoltaic cell’ means the smallest semicon- 23 ductor element of a solar module which per- 24 VerDate Sep 11 2014 06:34 Jun 24, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2140.IS S2140 kjohnson on DSK79L0C42PROD with BILLS 6 •S 2140 IS forms the immediate conversion of light into 1 electricity. 2 ‘‘(C) PHOTOVOLTAIC WAFER.—The term 3 ‘photovoltaic wafer’ means a thin slice or sheet 4 of semiconductor material of at least 240 5 square centimeters produced by a single manu- 6 facturer— 7 ‘‘(i) either— 8 ‘‘(I) directly from molten solar 9 grade polysilicon, or 10 ‘‘(II) through formation of an 11 ingot from molten polysilicon and sub- 12 sequent slicing, and 13 ‘‘(ii) which comprises the substrate of 14 a photovoltaic cell. 15 ‘‘(D) SOLAR GRADE POLYSILICON.—The 16 term ‘solar grade polysilicon’ means silicon 17 which is— 18 ‘‘(i) suitable for use in photovoltaic 19 manufacturing, and 20 ‘‘(ii) purified to a minimum purity of 21 99.999999 percent silicon by mass. 22 ‘‘(E) SOLAR MODULE.—The term ‘solar 23 module’ means the connection and lamination 24 VerDate Sep 11 2014 06:34 Jun 24, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S2140.IS S2140 kjohnson on DSK79L0C42PROD with BILLS 7 •S 2140 IS of photovoltaic cells into an environmentally 1 protected final assembly which is— 2 ‘‘(i) suitable to generate electricity 3 when exposed to sunlight, and 4 ‘‘(ii) ready for installation without an 5 additional manufacturing process. 6 ‘‘(3) RELATED PERSONS.—Persons shall be 7 treated as related to each other if such persons 8 would be treated as a single employer under the reg- 9 ulations prescribed under section 52(b). In the case 10 of a corporation which is a member of an affiliated 11 group of corporations filing a consolidated return, 12 such corporation shall be treated as selling compo- 13 nents to an unrelated person if such component is 14 sold to such a person by another member of such 15 group. 16 ‘‘(4) ONLY PRODUCTION IN THE UNITED 17 STATES TAKEN INTO ACCOUNT.—Sales shall be 18 taken into account under this section only with re- 19 spect to solar components the production of which is 20 within— 21 ‘‘(A) the United States (within the mean- 22 ing of section 638(1)), or 23 ‘‘(B) a possession of the United States 24 (within the meaning of section 638(2)). 25 VerDate Sep 11 2014 06:34 Jun 24, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S2140.IS S2140 kjohnson on DSK79L0C42PROD with BILLS 8 •S 2140 IS ‘‘(5) PASS-THRU IN THE CASE OF ESTATES AND 1 TRUSTS.—Under regulations prescribed by the Sec- 2 retary, rules similar to the rules of subsection (d) of 3 section 52 shall apply. 4 ‘‘(d) REGISTRATION.— 5 ‘‘(1) IN GENERAL.—The Secretary shall require 6 any person claiming tax benefits under the provi- 7 sions of this section to register with the Secretary at 8 such time, in such form and manner, and subject to 9 such terms and conditions, as the Secretary may by 10 regulations prescribe. A registration under this sub- 11 section may be used only in accordance with regula- 12 tions prescribed under this subsection. 13 ‘‘(2) REGISTRATION IN EVENT OF CHANGE IN 14 OWNERSHIP.—Under regulations prescribed by the 15 Secretary, a person (other than a corporation the 16 stock of which is regularly traded on an established 17 securities market) shall be required to re-register 18 under this subsection if after a transaction (or series 19 of related transactions) more than 50 percent of 20 ownership interests in, or assets of, such person are 21 held by persons other than persons (or persons re- 22 lated thereto) who held more than 50 percent of 23 such interests or assets before the transaction (or 24 series of related transactions). 25 VerDate Sep 11 2014 06:34 Jun 24, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S2140.IS S2140 kjohnson on DSK79L0C42PROD with BILLS 9 •S 2140 IS ‘‘(3) DENIAL, REVOCATION, OR SUSPENSION OF 1 REGISTRATION.—Rules similar to the rules of sec- 2 tion 4222(c) shall apply to registration under this 3 section. 4 ‘‘(4) INFORMATION REPORTING.—The Sec- 5 retary may require— 6 ‘‘(A) information reporting by any person 7 registered under this subsection, and 8 ‘‘(B) information reporting by such other 9 persons as the Secretary deems necessary to 10 carry out this section.’’. 11 (b) CONFORMING AMENDMENTS.— 12 (1) Section 6211(b)(4)(A) of the Internal Rev- 13 enue Code of 1986 is amended by inserting ‘‘36C,’’ 14 after ‘‘36B,’’. 15 (2) Paragraph (2) of section 1324(b) of title 16 31, United States Code, is amended by inserting 17 ‘‘36C,’’ after ‘‘36B,’’. 18 (3) The table of sections for subpart C of part 19 IV of subchapter A of chapter 1 of the Internal Rev- 20 enue Code of 1986 is amended by inserting after the 21 item relating to section 36B the following new item: 22 ‘‘Sec. 36C. Advanced solar manufacturing production credit.’’. VerDate Sep 11 2014 06:34 Jun 24, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6211 E:\BILLS\S2140.IS S2140 kjohnson on DSK79L0C42PROD with BILLS 10 •S 2140 IS (c) EFFECTIVE DATE.—The amendments made by 1 this section shall apply to components produced and sold 2 after December 31, 2021. 3 Æ VerDate Sep 11 2014 06:34 Jun 24, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6301 E:\BILLS\S2140.IS S2140 kjohnson on DSK79L0C42PROD with BILLS