Nextracker has announced the opening of the company’s third dedicated steel line in the U.S. Through a partnership with BCI Steel, the historic Bethlehem steel manufacturing factory in Leetsdale, Pennsylvania, just outside of Pittsburgh, will reopen to produce solar tracker equipment for Nextracker’s utility-scale tracker operations.
According to Nextracker, the steel processing plant will incorporate both new and reshored equipment shipped back to the U.S. from factories in Malaysia and Brazil. Solar tracker products produced at the factory will serve rapidly growing markets in Pennsylvania, Indiana, New York, and Ohio.
According to Nextracker President Howard Wenger, the reopening of the Bethlehem steel manufacturing factory will create 40 to 70 jobs directly, however the plant alone doesn’t represent the full employment impact of Nextracker opening operations in the area.
“It catalyzes a number of indirect jobs, and jobs further upstream, for the manufacturer of the steel itself, US Steel in this case, creating more demand for them,” explained Wenger. “Of course, there’s the job trucking and transporting the product. Plus, [the location of the plant] it enables faster delivery and faster construction and solar plants. So in our ecosystem that we’re building out, we believe that we’re going to create over 1000 direct and indirect jobs, when you look at our entire manufacturing footprint.”
Supply-chain relief
The move to sourcing American-made steel is one that became a necessity for Nextracker due to the pandemic and the resulting supply-chain and international shipping difficulties. According to Wenger, the company watched shipping and logistics costs skyrocket to more than 10-times pre-pandemic levels, while the cost of sourcing steel tripled. Even when the components could be sourced, material delivery had slowed to a crawl, hampering Nextracker’s ability to deliver its products to customers on time.
“We really hit a threshold, and that got us moving quickly,” explained Wenger. “But it turns out that it’s something we should have thought about before the pandemic, honestly, because it’s turning out to be a really good strategy for us. And we’re going to keep our international manufacturing. So we have both working in tandem, which provides a natural hedge for us. If steel costs go up in one region versus a logistics cost shift in another, we can toggle between regions. But, we are really targeting for the majority of our domestic U.S. demand to come from domestic manufacturing.”
Securing steel fabrication to alleviate supply chain concerns and shipping volatility is an emerging trend in the tracker and racking space, one that could hold momentum if the aforementioned market concerns persist. Another prominent name in the space, Terrasmart fabricates its own steel structures in house. In a prior interview with pv magazine, Terrasmart President, Ed McKiernan said that such an approach allows his company to switch up their operations “on a dime,” and to accommodate design and timeline changes for customers.
According to Wenger, the company’s main focus is keeping a consistent American supply chain of steel, as the logistics and availability of other tracker component materials have not been as disrupted.
Shortly after the announcement was made, the company also hosted a reopening event, attended by U.S. Secretary of Energy Jennifer Granholm, U.S. Senator Bob Casey, and leaders from some of the world’s largest clean energy companies, including the CEO of EDPR Sandhya Ganapathy and the Chief Operating Officer of Lightsource bp Ann Davies.
“I think having sent Secretary Granholm speak, and Senator Casey speak at our event, it’s a strong indication of the importance of of bringing renewable, clean energy jobs, and bringing a robust U.S.-made supply chain to life,” said Wenger.
Low-carbon steel
The reopening of the Bethlehem steel manufacturing factory marks the third steel manufacturing line that Nextracker has announced so far in 2022. In May, the company announced the launch of a line dedicated to producing steel tracker components for use in utility-scale solar power plants at Atkore’s Phoenix, Arizona facility, which was expanded and reconfigured with new capacity dedicated to Nextracker products. In April, Nextracker and JM Steel, a division of JENNMAR USA, announced a partnership under which a dedicated solar tracker production line was built on the campus of a new Steel Dynamics manufacturing facility near Corpus Christi, Texas.
According to Wenger, each location was specifically chosen to help Nextracker better serve some of its strategic growth and development markets across the U.S.
“We started first with where the projects are, because our strategy is to get our product, within one or two days, to our customers in the United States,” explained Wenger. “We started there, and then we mapped out where the steel manufacturing capacity is, and there is a really good intersection. I think the significance is that the U.S. has become a wide market. It’s not just in the Sunbelt, or its southwest. We have so much business now in the Midwest, in the northeast, in the heartland, that it really necessitated us to be there locally and making our products there for that market. I think that’s really significant for the industry.”
The Steel Dynamics facility in Texas utilizes electric arc furnaces in its manufacturing, which can lead to electric arc furnace facilities being up to 75% less carbon-intensive than traditional blast furnaces.In concert with this, Nextracker also shared that the steel that will be supplied for manufacture in the Bethlehem plant, which is being purchased from U.S. Steel, is produced entirely by electric arc furnaces, as is the steel supplied to Nextracker’s line at the Atkore plant in Arizona.
“Steel is like, 7% of the climate change problem, so if we can reduce the carbon content of our product by 10x, that’s very exciting and needed,” said Wenger.
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