South Korea’s Hanwha Group has significantly increased its investment in the United States this year, aiming to expand its local solar business and maximize the benefits of the Inflation Reduction Act (IRA), while also ramping up efforts for defense exports to the U.S.

According to a semi-annual report released by Hanwha Corp., the holding company of Hanwha Group, on Friday, the conglomerate has established a total of 26 new subsidiaries in the U.S. since the start of this year. In comparison, only 10 new subsidiaries were established in Europe, another key overseas market for Hanwha.

Among the new U.S. subsidiaries, a substantial majority of 20 are focused on solar energy business. Leveraging the incentives provided by the IRA, which came into effect last year, Hanwha Solutions, the leading player in the U.S. solar module market, is eligible to receive subsidies of 7 cents per watt for solar equipment manufactured in the country. As a result, Hanwha Solutions benefits from a tax reduction exceeding 1 trillion won ($745 million) annually.

Hanwha Solutions, the solar business arm of Hanwha Group, is currently investing a total of 3.2 trillion won to build Solar Hub, an integrated solar production complex, in Georgia, with the goal of completion next year. Once completed, Solar Hub will increase the company’s U.S. module production capacity to 8.4 GW, equivalent to the annual power consumption of over 1.3 million U.S. households.

A significant portion of the new U.S. subsidiaries, around 10, are responsible for solar power generation projects, including installations for residential and commercial properties. Additionally, six subsidiaries were established early this year as part of the energy storage system (ESS) partnership between LG Energy Solutions and three Hanwha Group companies.

Hanwha Solutions said that it anticipates the rapid growth of the U.S. grid ESS market, and thus established battery-related companies to prepare for future energy storage integration in their solar projects.

Two new installment finance companies were also established to provide installment financing services to customers installing residential solar PV.

The expansion of U.S. operations is under the leadership of Hanwha Group Vice Chairman Kim Dong-kwan. In March this year, Hanwha Futureproof, an organization for U.S. business operations, established by Kim, received investments totaling 1.3 trillion won from Hanwha Solutions (solar) and Hanwha Aerospace (defense). These investments are aimed at developing projects related to solar, batteries, ships, and liquefied natural gas.

By Oh Soo-hyun and Minu Kim

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]