The Inflation Reduction Act (IRA) has been abuzz over the past 2 years, particularly regarding the proposed Section 45x tax credit, which has piqued manufacturers’ interest and fueled onshoring and domestic content manufacturing growth. In October 2024, the U.S. Department of the Treasury (Treasury) and IRS finally released final regulations for Section 45X of the Internal Revenue Code that became effective on December 27, 2025. These final regulations present even more promising prospects for domestic content manufacturing than previously proposed. Decisions on which guideline to follow will be made on a project-by-project basis, largely dependent on planning and construction commence date.
As an US manufacturer in Houston, TX, Imperial Star Solar continues to navigate industry challenges with agility, leveraging its vertically integrated supply chain and strategic partnerships to secure domestic components for its modules. With a combination of long-term, strategic thinking and the ability to quickly adapt to new regulatory environments, we maintain sustainable growth and remain steadfast in the delivery of reliable products to our customers. We are proud to promote American-made solar modules, supporting local industries while contributing to a cleaner, more sustainable energy future.
Safe Harbor Method: New Updates and Implications
The latest iteration of the policy reflects clarification on various definitions, terms, and criteria, along with additional guidance for the Production Tax Credit (PTC) and Investment Tax credit (ITC) - the updates serve as a catalyst for the domestic content era, building upon the prior Safe Harbor provisions and incentivizing upstream manufacturing through credit incentives, should clean energy developers or EPCs opt for these routes. According to the Department of Energy (DOE), the default values in Safe Harbor have been revised to better align with specific project and/manufactured components. Moreover, the Safe Harbor guideline now accounts for PV modules that encompass domestically-produced wafers, further incentivizing onshoring of upstream components.
The following table illustrates the updated applicable percentage for project components for Safe Harbor via the Ground-Mount Method, as outlined in the latest IRS Notice Update 2025-08 applicable to projects starting January 16, 2025 and are under construction by the end of 2026, utilizing US modules with domestic-eligible cells and wafers. Comparably, the previous Safe Harbor in Notice 2024-41 table here is applicable to projects slated to construct by April 15, 2025.
In the updated table, module and tracker categories generally represent a larger share of potential domestic content compared to the 2024 table, while smaller subcomponents saw only a slight increase, if any. We interpret this shift as the U.S. government prioritizing the onshoring of core subcomponents for modules and trackers, placing greater emphasis on these key elements to secure domestic manufacturing. In the same vein, Production in the new table decreased from the prior, regardless of whether domestic c-Si PV Cells & Wafers are utilized, further emphasizing the focus on onshoring upstream components. On the other hand, the revised table shows a decrease in the potential contribution from inverters for domestic eligibility.
We also note that in the case of “a mixed source item” - project sourcing from both US and foreign manufacturers, any U.S.-made panels with domestic cells and wafers in addition to any cells from abroad, the domestic content will be assigned the weighted average using the c-Si PV column for calculation.
In other instances where portions of the modules are not made with domestic wafers but domestic cells, then companies in that scenario would utilize the normal column (without c-Si PV Cells & Wafers) to calculate the domestic content based on the percentage sourced.
Like all provisions, the Safe Harbor elective and related policies come with caveats. We recommend that companies consult third-party advisors to navigate these complexities, though we're happy to share our insights and knowledge based on our experiences.
Imperial Star Solar's Commitment: Bolstering U.S.-Made Modules
Amid the evolving solar landscape, we understand the challenges in securing the bonus adder. While securing the IRS credit bonus is not guaranteed, our expertise in navigating both the Direct Cost or Safe Harbor Methods allow us to effectively support our clients. We collaborate with our clients to streamline the 10% ITC bonus adder application process, ensuring it is as seamless as possible for our clients.
Since the inception of its U.S. presence, Imperial Star Solar has been dedicated to producing domestically eligible content, advancing our mission to drive excellence in American solar. We actively pursue strategic partnerships to increase the percentage of domestic content in our modules as demonstrated with our recent cell and frame collaborations with Suniva and CZT, respectively. We are also on track to introduce even more domestically eligible components this year, continuing to elevate the standard for American solar.
Additionally, our 2GW Houston, TX, facility marked a major milestone at the end of last year with the launch of domestic-eligible module production, ushering in a new era of homegrown manufacturing, with even more developments expected on the horizon. From domestic Cells and Frames to Junction Boxes and Encapsulants, we are working on prioritizing these U.S. components, all aimed at helping clients achieve full compliance with IRA and Safe Harbor standards. The picture above highlights the celebratory milestone of our first-ever domestically eligible module production.
Imperial Star Solar, perpetually focused on building strategic partnerships, was proud to host Erthos’ Chief Operating Officer and Director of Procurement for a tour of our Houston facility on January 6th, 2025. They took note of Imperial Star’s state-of-the-art facility and automation process, as they walked through the entire production process from raw material handling, assembly, lamination and various stages of stringent testing and quality control. The picture above captures a moment of awe and joy during the facility tour.
The tour with Erthos is one of many examples of Imperial Star forging meaningful partnerships while exploring areas of collaborations. Erthos, along with many other clients, has visited our facility to explore new avenues for collaboration, and we are excited about the possibility of more partnerships emerging from these insightful discussions.
Ready to learn more? We welcome you to schedule a tour of our state-of-the-art facility in Houston, TX to see firsthand how we manufacture American-made high-quality, reliable solar modules with precision and to further discuss how our U.S.-made solar modules can elevate your project and help you meet your compliance goals.
Domestic Content: What's Next?
The final Section 45x publication, along with the revised Safe Harbor calculation, underscores the U.S. government's commitment to onshoring solar manufacturing in response to increasing demand as developers, EPCs, and IPPs seek domestic-eligible content for their projects to obtain the 10% domestic content adder. Combined with the Trump inauguration and the current shortage of U.S.-based component manufacturers, the future of the Safe Harbor and the recent updates to 45x remain uncertain, but are likely to have a positive outlook as they incentivize domestic production and attract investment into the solar manufacturing sector.
The following are key takeaways from the recent policy change:
Incentivizes U.S.-made modules with domestic wafer component for 2025-2026 construction projects
Generally increases percentage of domestic subcomponents for modules and trackers, coupled with a reduction in contribution from inverters
Imperial Star Solar’s dedication to the U.S.-based manufacturing underscores our willingness to help clients navigate IRA compliance and obtain the 10% ITC bonus adder with streamlined process
Imperial Star Solar is an agile company, and we stand at the forefront of changing solar policies, navigating policy idiosyncrasies; thanks to our proactive planning and strategic foresight, and continuous efforts to enhance our capabilities and deepen our understanding. We go to great lengths to provide our clients with reliable, high performing American-made PV modules.
We’re excited to explore this topic (or any other) with you in person at Intersolar 2025 in San Diego, CA! Join us at Booth #425 to connect with us and our partners offline.
Intersolar 2025 | San Diego, CA
Amid the new inauguration, the shifting policies, and domestic content - we’re excited to explore these topics (or any other) with you in person at Intersolar 2025 in San Diego, CA!
Join us and our partners offline to explore the latest innovations in solar manufacturing, stay ahead of industry trends, and get up to speed on new regulations! Drop by Booth #425 and be part of shaping the future of solar energy. See you in San Diego!
At Imperial Star Solar, we are committed to advancing the solar industry with reliability, transparency, and deep sector expertise. We value your feedback and encourage you to stay informed by following us for the latest updates.
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News & Media
American-made solar wafers given more weight in latest domestic content bonus guidance
What does “safe harboring” mean for the solar industry?