All right, thank you. We're happy to welcome Jeff Spittel from T1 Energy today. Jeff, you know, really happy you could make it. I'm sure you had a busy day.
A little bit late. Better late than never.
Do you want to give a quick intro on yourself and your background?
Sure. So I'm the EVP of Investor Relations and Corporate Development at T1. I've been with the company since the start of our public journey. Our predecessor was FREYR Battery. We've had a pretty significant strategic pivot over the course of the last 12 to 18 months, and we're now in the solar business. We're the largest American-owned manufacturer of polysilicon solar modules in the United States.
We've got a facility that we acquired from Trina Solar in Dallas, Texas. We call it G1 Dallas. That's a five-gigawatt module facility that is fully up and running, and then we just started construction of a five-gigawatt, first phase of a five-gigawatt solar cell facility, which we're calling G2 Austin in Rockdale, Texas. We're not at full financial close there, but we'll get into a little bit of that, but we've got dirt moving.
And so the goal is to build an integrated end-to-end polysilicon solar supply chain in the United States where the raw material never has to leave the country. And hopefully, if things go according to plan by 2027, we'll be delivering modules with domestic content of north of 70%.
Great intro. So to start, I guess, you know, what attracted you to the Trina asset, like the pivot from Freyr to module manufacturing? What was it about the Trina asset and the Trina technology that drew you guys in?
Sure. So when you look at the top of the solar food chain globally, Chinese companies like Trina have run with technology that's been developed elsewhere in the world, including TOPCon, which originally came out of Germany, and they've come pretty close to perfecting it. From a manufacturing, supply chain management perspective, what have you, they're really good at what they do. We were in a situation where, as a battery company, we were going through the initial stages of production hell.
When we were FREYR, we were trying to scale up a novel U.S. tech stack. We're trying to do that as a public pre-revenue company. And then the price of LFP batteries collapsed while we were doing that. The cost of money went through the roof, and the quantums that you would need to commercialize a business model like that evaporated.
So the board, at some point in 2024, said, "We're going to need to try to figure something else out." And we were presented with this opportunity to finally get to your question, look at this Trina facility, and we said, "This is everything that we're not today and everything that we aspire to be as a pre-revenue public company. This is industry-leading technology. It's been validated at industrial scale.
This is a company that is highly bankable. It has a history of operating in the United States. This is a manufacturing facility where there's plenty of complexity and automation, but it's something that, after you have tried to make batteries, feels like child's play making solar panels." And it gave you immediately a chance to graduate and have revenue and customers and contracts and all that good stuff.
So I think we also had a perspective coming from the seller of saying, "The days of foreign entities operating in the U.S. and clipping 45X coupons were most likely going to come to an end, irrespective of how the general election went." So you really had the perfect marriage of buyer and seller. And then we consummated that deal in November of 2024.
We closed it right around the holidays of last year. And then, you know, 2025 was really our first year in the market trying to scale up the facility and deal with, you know, a lot of the things that had been going on on the policy front, which had commercial implications. So at times it felt like, you know, there was a lot going against you in 2025, but I think we've come out of that feeling pretty good where we are. And then the back half of the year certainly went a lot more smoothly.
I think that the kind of first question that everyone asks and that you've addressed recently is just the FEOC concerns. So can you walk us through the steps you've taken to de-FEOC and where you are in that process and how you feel about it? And then the kind of the second part of that is like, you know, where is Trina still involved in the entity at all?
You know, that process really started closer to 50 years ago. I'm from Union, New Jersey. Dan's from New Rochelle. Evan's from Philly. Nobody's perfect, right, in Evan's case. But we're American, right? This is an American company. We're listed in New York here on the NYSE. You know, the ownership structure is predominantly American. And by predominantly, I don't mean 51%. I mean like north of 75%, right? This is a U.S. company.
Our strategy has been to partner with an industry leader. And, you know, I guess some of the residue of that, though, from a regulatory standpoint, once the big beautiful bill was passed, was that, look, there's an obvious motivation for the government to say, "We don't want Chinese companies collecting incentive dollars from taxpayers in the United States." Everybody understands that. Our message is pretty simple. The administration wants reshoring of manufacturing.
They want us to shore up critical energy supply chains that are strategic to the interests of the United States. They want job creation and organic investment in their states, and that's what we're bringing to the table, so to us, this is solar was invented in the U.S. in the 1950s. This is how you take it back, right?
There is an incumbent who's an industry leader in a great company that they have their own technology, but it doesn't touch the polysilicon supply chain, and we think that's an interesting angle where you say, "What problem is T1 trying to solve?" We're trying to shore up the traceability and the security of the solar energy supply chain in the United States, but we're also putting a foundation in place for a polysilicon supply chain to start to gestate in the U.S. too, which has implications beyond what goes on in the solar market, and yes, I'm talking about chips.
So to your supply chain point, can you talk about some of the supply chain partners you've lined up so far?
Yep.
And then kind of how you get to the 70% domestic content, like where those different stacks are?
Sure. So part of the philosophy here is try to build a coalition of American companies, right? If you're going to try to establish an end-to-end supply chain, you're not doing it on your own, particularly as the time that we embarked on this, right? $200 million market cap, that dog wasn't going to hunt. We needed to do business with partners and vendors in the U.S. anyway.
So, and we had a domestication strategy of our supply chain and bill of materials. So all that dovetailed well with some of the deals that we've announced. So when we made the initial acquisition, we got G1 Dallas, but we also got a contract with Hemlock Semiconductor for polysilicon at scale. And so that we think is interesting strategically for us. And we can get into 232 at some point. I'm sure we'll touch on it.
We've also now signed a contract with their parent company, Corning, to source wafers that are made at their new plant in Michigan as well. And then you've got some other arrangements with suppliers like NextPower, our friends there, where we're going to be sourcing U.S. frames made with steel made in the United States. We think that it's actually a better solution and a better product than what you can get today in terms of aluminum frames made outside the U.S.
So checking a number of boxes, right? And now we've also got an offtaker, right? We announced recently that Treaty Oak was our first offtake customer. So we've got a partnership with them now where they've committed to 900 megawatts of offtake from G1, which will be fed with the future cells that are coming out of G2. So that feels pretty good, right?
We're working on a second offtake contract, which we think is the final precondition to getting a financial close for the first phase of G2 Austin, so starting to build that coalition of the willing American companies, right? And, you know, Dan will say things like Dan Barcelo, our Chairman and CEO, "We're building America, right? This is American infrastructure.
These are American companies working together," and yes, we've got a partnership from overseas too that's helping us get all this stood up, but again, we couldn't have done it on our own, and we don't just rely on Trina, right? These are our American partners. They're going to help us grow as a company and become increasingly independent.
And so until you get G2 online, the path for your polysilicon is what? Like your wafers here to cells, what does that look like? And you brought up Section 232. What are you hearing there? And how, you know, how could Section 232 impact your business today before even G2 comes online?
Sure. So the polysilicon supply chain. Corning is ramping up a couple of different paths. So let's start with where it goes predominantly today. Starts in Michigan, goes to a wafering facility that Trina owns in Vietnam, make a wafer out of that. Then now, post-2026 or post January 1, it will no longer go to a Trina cell facility overseas. It'll go to a non-FEOC third-party vendor.
And we've said publicly that we expect to source 3.1-4.2 gigawatts for this year. 2026 is a bridge year to get to G2 when we have our own domestic cell capacity. So once you make the cell overseas, right, from one of those third parties, it comes back to Dallas, and then we assemble everything into a module at G1. Let's talk maybe future state, right? Polysilicon starts with Hemlock in Michigan. It goes to Corning in Michigan.
It goes to G2 in Austin, and then it goes to G1 in Dallas, and it never leaves the United States, right? So 232, what is the implication there? That contract with Hemlock, I would consider a call option that we bought on polysilicon that isn't necessarily going to be the cheapest that you can find. It's very high quality, but it's domestic.
If the 232 ruling puts a tariff on foreign polysilicon, that call option is flipped to in the money. And it just creates one less headache for a customer to deal with, right? And of course, if you have a full U.S. supply chain, everything is traceable, right? And you know who's making this stuff. So, you know, we think that's pretty attractive. And we'll see, right?
The proof will be in the pudding commercially as we start to mature the business and then probably when we get to the second phase of G2 as well. In the meantime, we may leave some capacity from the first phase of G2 to preserve a little spot exposure depending on how this ruling goes, right? If it has some teeth in it, presumably you would think there's a positive price signal for a module made with U.S. polysilicon.
That's awesome. All right. And then just today or your visibility to offtakers, so like kind of the stack of offtake contracts that you have, you hit on G2, but just like what you have today and kind of how that pathway flows through?
Sure. Sure. So we have a, and this has all been publicly filed.
I don't know if they're like cost plus or like maybe kind of how the contracts are set up.
We have a cost plus contract of one gigawatt a year with Trina Solar US. That's a sales distribution force. And again, as we've been standing up T1's business and organization, they've been helpful. That runs for another four years. That is cost plus. It's a good margin contract, right? It's part of what was used to underwrite the G1 facility and fund it, right, before we came along.
So that's a nice economic contract that extends for another four years, as I said. There's your baseline. We just signed 300 megawatts a year, right, for three years with Treaty Oak Clean Energy. And then we've got another one that we're working on that, you know, similar quantum and duration to that. So we're looking forward to hopefully announcing that pretty soon. So let's say all in for your first phase of G1, you're at 2.1 gigs of U.S. cells.
We should have the lion's share of that contracted hopefully pretty soon here. And so once you do that, you can get hopefully a fairly vanilla piece of debt would probably be what we'd put on G2 to get to full financial close. We've already started construction. We've already been spending money. And, you know, we've shared footage of the bulldozers moving, the infrastructure work that started at the site.
And we started to order some steel, right? And this would get us to full speed ahead, production line equipment, some of the other items, which aren't necessarily the long lead items. We're on the critical path from a timing standpoint, but they're the chunkiest dollars that you're going to spend. So hopefully in the near term here, we'll be cooking on that.
The idea would be to have G2 completed by year-end and then ramping.
That is the plan.
27?
Yes. You know, if we keep moving in accordance with the timeline I just laid out, then we should have that up and running and then a brief ramp period early in the year next year. But we should be making our first cells hopefully before the end of this year.
Okay, and around the offtakers, I know originally the plan was to kind of lean on the Trina sales force a little bit, but just maybe some of the moves the company's taken to in-house some of that sales and what you're seeing in terms of demand and interest for what you're offering in the market.
Yep. So I mean, some of this is growing up as a public company, right? When we first made the acquisition and closed it, we had to introduce ourselves to these customers, right? And I think there's probably a healthy amount of skepticism as a new company of, you know, can I rely on you guys to deliver? What are your technical bona fides?
And, you know, what do you bring to the table here, right, that it wasn't getting already? So that indoctrination process lasted a large portion of last year. And, you know, truthfully, the sales force is lean and mean as we're trying to run as we're standing things up last year is the C-suite and a couple of EVPs like me are going out and introducing ourselves, telling our stories, right? That's where that sales support was helpful.
I think now we're starting to graduate into having direct conversations. And it's not stepping on one another's toes, but the introductions have been made. I think we're starting to make some waves in the market, right? We've been active through various communication channels publicly. So we no longer need to say, "Hi, we're from T1. Here's what we're up to." And I think so there's a natural process where it's evolving where, you know, we spend more time face to face with the customer now.
Just go back to the way it's set up and the offtake contract. So phase one's 2.1 gigs. The G1 is five gigs. Like is the plan to then provide, you know, non-FIOC, non-domestic cells for that three gig or blend? And like how do you get that?
Yeah. Yeah. And I mean, I think this is going to be interesting to see how this plays out commercially because this won't surprise anybody, but developers are always pretty focused on ASPs and cost. If we think about it as a menu, the fully domesticated supply chain is the premium product, right? You're taking headaches and risk off the table, tariff exposure.
You're creating eligibility for domestic content stacking bonuses, which is a serious economic carrot, right? 48E, if you're delivering a module north of 50% domestic content, qualifies the customer for an investment tax credit that's up to 10% of the cost of the total project, right? So that's pretty powerful right there.
Having said that, some customers will say to you, "I would like to have 50.001% domestic content to qualify for the bonus." And then I like the flexibility of being able to blend and order through the global supply chain that you have access to through the Trina relationship, right, to keep the overall cost down. So we'll see as we get G2 up and running what folks want to do in terms of blending.
And I think there are a number of wild cards in there, right? Who is still eligible for 45X now that these more stringent restrictions have kicked in after the first of this year? What's the overall demand picture look like, right? How squishy is some of the data center queue? Or is this all going to materialize, right? So if the market's short, you feel like people are going to worry a little bit less about what the domestic content piece costs, right? But TBD.
I know like everyone's trying to do their due diligence on the de-FIOKing and then just your like ability to manufacture at scale. We can get into that. But how should we think about the level of due diligence that the off-takers are doing before they sign these contracts? Like maybe that's where things we're not seeing, but what that speaks to.
No, we were talking about this last night. It's fairly invasive and it should be, right? And I think about it from a standpoint of we're a new company. We haven't made modules with U.S. cells, right? The facility isn't funded. And yes, it's under construction, but it doesn't actually exist today. So the initial offtakers need to get very comfortable about everything you're doing, right? QA, QC, and HSE, all that stuff is table stakes. You better be good at that, right? Your balance sheet. We've gone a long way toward getting people comfortable with the capital formation that we've done since October, right? We've raised north of $400 million, north of $440 million since October.
So that's definitely been helpful of saying, "Okay, look, what I want is when I'm signing a contract that starts in early 2027 for a facility that isn't yet funded or built, I want to make sure that these modules are going to show up and that they're going to show up with QA, QC that I expect," right?
So this first offtake contract with Treaty Oak, these conversations have been going on for a long time, right? The folks that are behind them in the queue, you know, well north of a year. So, you know, we think we've gone through a lot of gates to get people comfortable that we're for real. And, you know, we just keep our head down, right, on the next few.
Yeah. Great. And then you brought up the balance sheet. So like today, where do you stand? Maybe like how much you think you need to still finance with G2 and major milestones on G2?
Yeah, I think for G2, you know, the balance sheet is in much better shape, right? So we've done a concurrent convertible and common equity deal in December that the gross proceeds were $322 million. We just went through a transaction, right? We retired $305 million of face value debt for $273 of cash out the door, right?
So a lot of that money has already gone back out as part of the De-FEOCing transactions we announced before the end of the year. But we also just announced a $160 million 45X sale to a third party. That's the first time we were able to achieve that. So that added some liquidity. You have offtake deposits, right? We've got one in the door here. So the balance sheet's in good shape. Liquidity's in good shape.
We do want to put a piece of debt that is, you know, certainly something cost palatable we would hope for and not particularly heavily structured on to get to full close for G2, so that's really the next item on the list is get this offtake, close on G2, do that quickly, and let's get moving.
Cool. Around the, well, when you did the first deal, you kind of gave some long-term guidance around potentially build a. I guess that was a, I think that was like five gigs G2, five gigs G1, I forget.
Yeah.
But like just kind of maybe the core framework around that, like what did that imply for gross margins, pricing? Like, and then like, are you seeing, like are you still on the path for that? Or is, are you seeing something different?
The $650-$700 million EBITDA guidance number, that's an annualized run rate. And to be clear, that's both phases of G2, right? That's five gigs solar cell integrated with five gigs of solar module in the U.S. Pricing assumptions aren't radically different from where we are today or where the first offtake was signed.
There's probably even, you know, potentially even upside if things go really well commercially or if 232 is meaningful. But we're on track in terms of, right, the contracts that we're signing today will get us in the sweet spot with guidance, right? The interim guidance on phase one of G2 and with G1 is three something to four something, right? We'll see. And we'll get all this refined over the next few months as we continue to sign contracts.
But, you know, I think the message is we're one offtake contract away and financial close on phase one to putting together a pretty definitive path at some point in 2027 to be generating EBITDA on at least a run rate basis that's, you know, hopefully around $400 million.
I didn't talk about the ASPs, but the cost side of that, your bill of materials this year or last year in 2025. I think probably moved around a good bit and like onshoring some stuff. Just kind of do you feel like that's at more of a steady state? And as you scale, you get some benefit there?
I absolutely do, right? And you had a lot of noise last year, particularly in the middle of the year as you started to have reciprocal tariffs kick in and, you know, particularly for folks who are learning the solar manufacturing business on the fly. Okay, this is why they call it the solar coaster, right? You have certain inputs of subcomponents that are inflating a couple thousand percent overnight, right?
So that was a difficult several months of saying, you know, costs are inflating. The market was pretty stagnant from a commercial standpoint before the bill was actually crafted. But during that process, right, we started to get our arms around it. Things started to settle down, right? That's been true into the start of this year. We feel like we know where our costs are now. The bigger picture goal is what a U.S.
company can bring to the table to the manufacturing from Trina and from their brethren, the automation at these plants, particularly the one we acquired, we think is the most advanced automated module plant on earth. Just until the next one gets built, right? But it's a pretty stunning facility, but there are opportunities to upgrade the software that supports all that really cool hardware and I think become increasingly cost efficient over time.
That's part and parcel of the work that we're doing with Palantir is to identify how somebody from the States can bring a little secret sauce into a plant like this and make it more economically efficient. That's going to take a while, right? To be clear. So we know where our costs are today. We know where the targets are a few years out.
We feel pretty good about the way it's playing out over the next year or so until we can start to make some of those bigger picture structural modifications the way we do things at G1. But yeah, we have a better handle on it now certainly than we did, you know, six, eight months ago.
And then pricing, not something we can control, but you feel relatively good about the domestic content proposition, stackable 45X credits, bringing something that really doesn't exist today, that end-to-end poly module to the U.S. That, you know, hopefully is going to have favorable pricing implications is more so as we get into phase two for G2, right?
Yeah. And then I know the team's been engaged in a lot in Washington, but like anything around policy or just kind of like something interesting maybe you're hearing around policy that could be something to think about?
I think it's a grassroots program, right? Engaging with lawmakers is a full-time job when you're in this business, and so we spent a lot of time in front of lawmakers both in Austin at Capitol Plaza and then on Capitol Hill. Dan's there today in DC, and it's just telling a story of, look, this aligns with, as I said earlier, reshoring, advanced manufacturing, creating jobs, critical energy supply chains, you name it, right?
This is what T1's up to. Initially, you have to introduce yourselves and, you know, be honest, maybe the political climate wasn't that favorable for somebody who just announced that they acquired a Chinese facility and they're in solar. That didn't necessarily carry a lot of favor in DC at times last year.
But now when you start to unpack the story and people get to know you a little bit and get to know, hey, these are Americans, they're working with American companies, they're trying to do something positive, I think we're getting there. So, you know, you never call all clear on policy, but I think one element of our story that's resonating is the polysilicon angle, right?
Of saying the chips market is not that far adjacent and making solar wafers isn't like a huge leap for what you could do in the chips market. So if you can stand up a more robust polysilicon supply chain in the U.S., it's only a matter of time where you might be able to take the chips market in-house as well, right? But this is the test case. And to be clear, very different grades, right? Different levels of complexity.
But, you know, this would be the foundation of doing something like that.
That's great. I think we're all out of time. So definitely appreciate the time today.
Thanks to me. Thank you for having us though.
Thank you, Jeff.
Appreciate your time.