Bend-based PV Powered, the largest manufacturer of solar power inverter technology in Oregon, laid off less than 10 percent of its workforce — the company had a total of 60 employees — due to decreased market demand in anticipation of a federal investment tax credit (ITC) lapsing, Erick Petersen, vice president of sales and marketing for the company, told CBN.
The tax credit, which encourages individuals and companies to switch to solar power, is set to expire in December, and the lapse could have devastating effects on the solar power industry to the tune of $19 billion, according to industry observers.
Others, however, say the negative impact being experienced by PV Powered and other solar power component manufacturers, is short-term and that the industry as a whole is one of the few sectors of the U.S. economy that remains bullish during the current national economic nosedive.
Petersen said the layoffs in Bend are directly tied to Congress’ indecision related to renewing the investment tax credit, which totals as much as $2,000 for residential projects and 30 percent for commercial.
“We are already seeing impact — this is happening in real time,” Petersen said. “We are expecting a 50-60 percent decline, and people are already canceling jobs. Even if Congress comes back in September and extends the ITC before the (presidential) election, the damage really has been done. It’ll be shorter lived if it’s passed again, but a lot of these big projects take months of planning and then weeks or months to do the installation work. At this point people have no expectation of the ITC being renewed.”
Petersen said PV Powered’s status as a small company means it can’t afford to wait out the Congressional vote any longer, and that it was forced to make a decision about how to reserve working capital while demand for its products is suspended; solar power projects across the U.S. are being delayed in anticipation of Congressional action.
Congress is set to vote on renewing the tax credit in September, but some observers say it could hold off voting on the issue until a new administration takes office.
“No matter what happens with the ITC this is short term,” he said. “The solar power market is still an incredible opportunity with long-term potential, and there is no real concern that the ITC will not get passed (eventually). In fact, we might even get a better ITC next year. PV Powered remains bullish on where all this is going long term — plenty of opportunities remain here in Bend — but unfortunately in the short term we are experiencing a squeeze.
PV Powered, which industry observers time and time again refer to as one of the most important manufacturer of solar power components in the U.S., recently announced it would provide the inverter for a statewide, solar-power project that aims to power street lights at the Interstate 5 and Interstate 205 interchange in Tualatin. The $1.3 million project, which basically erects solar panels at a cloverleaf section of the freeway, is the result of a collaboration with Portland General Electric (PGE), US Bank and the Oregon Department of Transportation (ODOT), with materials and installation being provided by Oregon-based companies.
The project is expected to be completed and online this December.
