(Bloomberg) -- Startup Swift Solar Inc. wants to build a US factory for manufacturing its futuristic panels in the next two to three years amid government plans to bolster the sector against China’s dominance.

The California-based company aims to produce cells with a material known as perovskite, which can allow panels to capture energy from the sun’s rays more efficiently. Durability, though, remains an issue. 

Swift plans to open its first plant with the initial capacity to produce 100 megawatts annually of technology that pairs perovskite with traditional silicon photovoltaic cells. For comparison, the average Chinese plant churns out about 10,000 megawatts per year while US projects tend to be in the 1,000 to 3,000 megawatt range, according to BloombergNEF solar analyst Jenny Chase.

The company has received $44 million in financing, as well as a recent $7 million award from the US Energy Department as part of a Biden administration initiative backing innovative projects announced last month. Swift has received more than $16 million in federal and state grants, it said a statement.

The venture capital arm of Eni and Fontinalis Partners also just led a $27 million Series A round. Swift is looking at sites in Northern California for its plant, though it said it’s not limiting its search to the area.

Pairing perovskite with silicon can increase efficiency up to 30%, according to a paper published in Science last year, as well as reduce costs. After losing solar manufacturing dominance to China, the US government is trying to play catch up by imposing tariffs on imports, and offering tax credits and incentives to make locally produced equipment more competitive. It’s also investing in new technology.

“We’re developing this tandem technology that is an opportunity for the US to bring that next generation home,” Swift Chief Executive Officer Joel Jean said. “China is tilting the playing field with subsidies. And those subsidies drive overcapacity across China and Southeast Asia, and they distort the global market.”

Swift is one of the firms that supported solar manufacturers’ petition in April asking the US government to slap higher tariffs on equipment imported from Southeast Asia. The country is inching closer to imposing the duties following the US International Trade Commission’s vote last week concluding that cheap imports are harming local manufacturers. It’s the first of the four major steps to review the industry’s petitions. Preliminary duties could be imposed as soon as three months from now.  

“Chinese manufacturers are scaling up perovskites already,” Jean said. “They’re investing in it, and the question for the US now is, do we want a seat at that table?”

The scale remains small in China, with Chase noting “there’s no real commercial production.” And while the process to make perovskite is cheaper and shorter, the material faces major hurdles before it can be commercialized, including durability and stability.

“There are serious doubts about whether perovskite is the product that will ever come to market,” she said. The cells degrade very quickly and face numerous manufacturing challenges, which is why no company has made a breakthrough to commercialize the technology, Chase added. 

Swift said it has improved cell stability 10 times since late 2020 and made commercial-size tandem prototypes that are being tested independently and with third parties. The company is testing its latest modules outdoors in California and Colorado in conjunction with a perovskite research center led by Sandia National Laboratories.

--With assistance from Jennifer A Dlouhy.

((Updates with funding totals from state and federal sources in the fourth paragraph . A previous version included a correction to clarify company's funding breakdown.))

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