TL/DR –
First Solar, the largest US manufacturer of solar panels, has seen its profits and stock price increase significantly due to federal subsidies from the Inflation Reduction Act, passed by the Biden administration. The company had contributed $2 million to support Democrats in the 2020 elections, including $1.5 million to Biden’s campaign, and spent a further $2.8 million lobbying the administration and Congress following Biden’s inauguration. Critics argue that First Solar’s financial success demonstrates how campaign contributions and lobbying can yield significant returns for well-connected companies, with some describing the situation as wealth redistribution.
DC-based First Solar gains wealth amidst green energy focus
Green energy has been identified as a redistributor of wealth. In this regard, First Solar, a major domestic solar panel manufacturer and Democratic Party affiliate, is profiting immensely. AP reports indicate that the company donated heavily towards the Biden campaign and lobbied extensively post-election.
Following Biden’s Inflation Reduction Act in 2022, First Solar’s finances surged, with its stock price doubling courtesy of federal subsidies. This windfall also benefited Democratic donors who invested heavily in the company.
First Solar’s lobbying prowess was instrumental in shaping legislation that yielded large returns. Samantha Sloan, First Solar’s chief lobbyist, commended the Congressional staffers who ensured that the law delivered the intended benefits, notably for Biden’s campaign donors.
First Solar’s ties with Democrats date back to the Obama administration, which subsidized the green energy sector, including First Solar, through government-backed loans. One of these companies was Solyndra, which received the first clean energy loan in 2009, only to declare bankruptcy two years later.
First Solar executives met several times with administration officials in 2022 and 2023, playing a crucial role in the Inflation Reduction Act’s environmental provisions. The company stands to benefit significantly from the Act, which includes tax credits designed to make domestic clean energy manufacturers more competitive.
Last year, First Solar sold about $650 million of these credits to a tech company, resulting in a significant influx of cash. Major Democratic donors who have invested in First Solar have also benefitted from the company’s rising stock price. For instance, Farhad Ebrahimi, co-founder of Quark, made it to the Forbes billionaire list in 2023, partly due to the increasing value of his stake in First Solar.
Jim Simons, a Democratic mega donor and founder of hedge fund Renaissance Technologies, started buying First Solar shares when negotiations for the Inflation Reduction Act began. His hedge fund purchased more than 1.6 million shares, which were sold in 2023 after the company’s stock price soared.
First Solar has had its share of controversies. In 2012, Republicans scrutinized the company over strong-arm tactics used to secure over $2 billion in loans from the Obama administration. Additionally, the company recently settled a securities fraud lawsuit for $350 million without admitting any liability. Despite these issues, the company continues to play a vital role in achieving Biden’s climate goals.
According to Pat Parenteau, a senior fellow at the Environmental Law Center, First Solar, despite its imperfections, is a crucial player in the green energy sector. As the largest US-based solar manufacturer, it is a necessary ally for Biden to achieve his climate goals.
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