The Energy Department wants to pay companies to produce environmentally friendly solar panels.

In June, US solar cell manufacturer Qcells became the second company in the world to register its solar panels with EPEAT, a labeling system that sets sustainability standards for electronics manufacturers. In doing so, the company introduced an obscure regulation that requires federal agencies to purchase EPEAT-certified solar panels. If, say, NASA wants to build a solar farm to power a research facility, it must now purchase panels that meet stringent EPEAT sustainability requirements, including a first-of-its-kind cap on the carbon emissions associated with solar power production.

There’s just one problem: although EPEAT launched its solar energy standards in 2019, there are only six EPEAT-registered solar panels on the global market today. And there are currently no EPEAT-registered solar inverters, devices that convert the DC electricity produced by a solar panel into AC electricity that is used on the grid. This leaves little choice for the federal government or anyone else who wants to purchase green solar equipment.

That’s why in October the Department of Energy (DOE) created a new award that offers up to $450,000 to solar panel and inverter manufacturers that earn EPEAT certification for their products. As a new wave of domestic solar energy production gains momentum, the Department of Energy hopes this award will ensure companies use efficient processes, environmentally friendly materials, fair labor practices and low-carbon energy.

“The fact is, not all solar (products) are created equal,” said Patty Dillon, vice president of the Global Electronics Council, a nonprofit sustainable technology organization that administers the EPEAT eco-label.

Solar panels convert the sun’s rays into electricity without emitting any emissions. greenhouse gasesmaking them essential to combat climate change. To achieve net-zero emissions by 2050, the International Energy Agency estimates the world will need to add 630 gigawatts of new solar power annually by 2030 – up from 135 gigawatts installed in 2020.

But some solar panels are more climate-friendly than others. Polysilicon, which is used to make the sunlight-harvesting cells inside silicon panels, is produced using an energy-intensive process that often runs on fossil fuels. The frames holding the solar panels together are made of aluminum, which is typically smelted in China using electricity generated from coal. The manufacturing processes that turn these materials into a solar panel also require energy, which can lead to increased emissions. Globally, the difference between solar panels made with clean energy and solar panels made with fossil fuels could amount to tens of billions of metric tons of carbon pollution by the middle of the 21st century.

To minimize these emissions, as well as other environmental issues such as the use of toxic chemicals and solar e-waste disposal, companies must take a hard look at their supply chains and, in some cases, engage in complex cleanup work. The U.S. Department of Energy’s new Promoting Registration of Ecolabeled Inverters and Modules, or PRIME, award encourages companies to do so by completing the EPEAT registration process.

“EPEAT certification allows companies to demonstrate how they are taking steps to create cleaner supply chains and manufacturing processes,” Becca Jones-Albertus, who leads the Department of Energy’s Office of Solar Energy Technologies, told Grist.

Solar companies seeking EPEAT registration must meet a list of criteria covering four broad topics: climate change, sustainable resource use, hazardous chemicals and responsible supply chains. Depending on how many standards a manufacturer meets, it may receive an EPEAT Bronze, Silver, or Gold designation.

In addition, as of June, EPEAT-registered solar energy manufacturers must meet industry-first criteria for carbon content—the emissions generated during the production of a product. For every kilowatt of energy produced, the production of an EPEAT-registered solar panel can emit a maximum of 630 kilograms of CO2. That limit represents about 25 percent less carbon emissions than the global average, Dillon said. Solar panels that emit below the “ultra-low carbon” threshold of 400 kilograms of CO2 per kilowatt of power receive a special EPEAT Climate+ label.

“Essentially best in class,” Dillon said.

It is difficult to make a direct comparison with fossil fuel plants because most of their emissions come from operations rather than infrastructure construction. But other studies have shown that over their lifetime, solar power plants are significantly more climate-friendly, emitting about 50 grams of CO2 per kilowatt-hour of energy produced, compared with about 1,000 grams per kilowatt-hour of coal.

EPEAT compliance isn’t easy, which may explain why only two companies are currently listed on the registry: QCells and Arizona-based First Solar. And only two solar panels produced by First Solar have received the Climate+ eco-label. QCells, which manufactures two EPEAT-registered panels at a plant in Dalton, Georgia, spent about two years on a “very extensive” certification process that included collecting data throughout its supply chain and submitting it to a third-party audit, head of corporate communications Debra DeShong told Grist.

“It’s not an easy task,” DeShong said. “It takes resources and it takes will.”

Other companies may now be motivated to try. The inclusion of QCells in the EPEAT registry in June activated the Federal Acquisition Regulation, which requires the federal government to purchase products that meet standards set by the U.S. Environmental Protection Agency, except in limited circumstances where this is impractical. In the case of solar panels, this means products registered with EPEAT. The U.S. Department of Energy’s PRIME Award, which provides U.S. solar manufacturers $50,000 for starting the registration process and up to $100,000 per product (up to four products that complete it), offers an additional incentive. Jones-Albertus told Grist that the prize was intended to “roughly offset the cost of collecting all the data and going through the registration process.”

Solar companies “have told us they are interested in EPEAT certification but have not yet received it,” Jones-Albertus said. “We hope to provide incentives to get companies through the EPEAT registration process more quickly.”

Companies taking a closer look at their supply chains for the first time may find that they need to make some changes to comply with EPEAT registration requirements. To reduce carbon emissions from its panels, a solar power manufacturer may have to switch to a supplier of low-carbon polysilicon. (QCells, for example, sources its polysilicon from a facility in Washington state that produces the material using hydropower.) Or it could decide to replace virgin aluminum frames made overseas with recycled steel frames made domestically by Origami Solar, which can reduce frame-bound carbon dioxide emissions exceed 90 percent. To meet EPEAT’s additional recycled content criteria, a manufacturer may choose to begin purchasing recycled glass from a company such as SolarCycle.

Such changes in the manufacturing supply chain require time and money beyond what the new DOE award provides. But Dillon of the Global Electronics Council is optimistic that more companies will begin registering their products with EPEAT now that federal buyers require it.

Erik Petersen, chief strategy officer at Origami Solar, believes the Biden administration’s push for clean domestic production, coupled with growing consumer interest in supply chain transparency, will encourage more U.S. solar companies to ensure their products meet high sustainability standards.

“What’s interesting is that all these forces come together at the same time,” Petersen told Grist. “It really gives the industry an incentive to do the right thing.”

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