SolarEdge closes USD-40m tax credit sale for US-made inverters

Israel-based photovoltaic (PV) inverters supplier SolarEdge Technologies Inc (NASDAQ:SEDG) on Tuesday said it has closed its first sale of Section 45X Advanced Manufacturing Production Tax Credits, obtaining USD 40 million (USD 36.7m), net of discounts and fees.

The tax credits were generated from the sale of inverters produced in the first half of 2024 at the company’s facility in Austin, Texas.

SolarEdge interim chief executive Ronen Faier said the transaction is an important milestone in the maturation of the Section 45X credit transfer market and demonstrates the marketability of credits backed by US-made inverters.

“The liquidity provided by the sale of these credits will enhance our cash position, further strengthening our balance sheet and enable us to accelerate our investment in our United States manufacturing footprint,” added chief financial officer Ariel Porat.

SolarEdge’s Austin facility achieved a quarterly run rate of 500 MW of inverter production in the second quarter of 2024, produced more than 500 MW in the third quarter and is expected to ramp production in the final quarter of the year. The company’s second US facility near Tampa, Florida started shipping power optimisers in the second quarter of 2024.

The US Department of the Treasury recently released final rules for the Advanced Manufacturing Production Tax Credit, which confirmed that SolarEdge’s DC-optimised inverter systems qualify for the USD 0.11 per watt credit.

SolarEdge is due to report third-quarter results on November 6. In the second quarter, the company recorded net loss of USD 130.8 million after revenues experienced a 73% year-on-year drop.

(USD 1 = EUR 0.917)

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