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With Georgia’s leadership in America’s energy transition increasingly reliant on international partnerships, U.S. Sen. Jon Ossoff has been racking up the air miles in an effort to ensure they stay strong.
The Democratic senator has led two Asian economic missions since his election in 2020, first to South Korea and recently to India, which he sees as key allies in positioning Georgia as “the renewable energy and clean tech capital of the United States” and opening global markets for Georgia firms.
Fresh off a September trip to India, Mr. Ossoff spoke with Global Atlanta and Indian community magazine Khabar after addressing the Georgia Indo-American Chamber of Commerce during a meeting hosted by the Gwinnett Chamber Thursday.
His tenure (and the trips) have coincided with a time of uncertainty, as the U.S. seeks to boost supply chain resiliency and national security after the pandemic, all while leading a clean-energy revolution centered on a transition to electric vehicles.
Georgia’s momentum in the EV sector began with SK On’s $2.6 billion battery plant in Commerce; now, the South Korean firm is building a second facility that will double that initial investment. The complex could eventually create more than 5,000 jobs.
Mr. Ossoff took a personal interest in the investment when an intellectual-property dispute between SK and rival LG Chem threatened the viability of the Georgia plant. He held meetings with both companies’ executives in Korea and Washington that he said helped broker a settlement.
SK eventually agreed to pay LG $1.8 billion before a trade court ruling that could have barred the importation of critical materials. Such a ban would have effectively shut down production.
“Early on, I was engaged in building those relationships directly with Korean business leaders to support Georgia’s interests and its economic development,” Mr. Ossoff told Global Atlanta.
The Korea trip in November 2021 was part of that effort. While there, he met with then-President-elect Yoon Suk-yeol and executives from Hyundai Motor, which would later announce at $5.5 billion dedicated EV and battery factory near Savannah, as well as Hanwha Group, whose QCELLS facility in Dalton has become the largest solar panel factory in the United States.
“I am leading international economic diplomacy on behalf of the state, helping to resolve disputes between major firms that threaten economic developments in the state and building personal relationships at the highest level in both Korean and Indian businesses who are potential investors in Georgia, while working to open foreign markets to Georgia producers,” Mr. Ossoff said.
IRA Complicates Equation for Foreign Car Makers
But Mr. Ossoff’s affections for South Korea and his energy and security priorities have collided in the Inflation Reduc\tion Act, the more than $369 billion climate, health and tax package President Biden signed into law Aug. 16.
The law includes ambitious solar manufacturing incentives that Mr. Ossoff initially introduced via separate legislation in the Senate. His plan includes tax credits not only for the production of solar panels, but also for polysilicon, cells, wafers and the modules themselves.
“Chinese industrial domination of the solar supply chain has become untenable,” he said, citing concerns of about forced labor in Xinjiang and the broader strategic value of solar technologies at a time of rising energy prices and climate concerns.
“Demand for these these technologies, products, components is growing at a very rapid pace, so we need that industrial base in the U.S., and the legislation is intended to support the development of domestic production at every phase of the solar supply chain.”
Solar producers including Georgia’s QCELLS and Gwinnett-based Suniva have long cheered domestic incentives as well as anti-dumping duties on Chinese producers.
Critics, however, have pointed out that incentivizing winners in the U.S. could raise costs and hurt installers, which employ far more people than manufacturers. Mr. Ossoff pointed more to the strategic nature of the sector as his guiding principle.
“Already we’re seeing, because my legislation has become law, (capital expenditure) announced in states across the country. That doesn’t mean that there don’t remain risks or that the development of that integrated domestic supply chain is assured, but that’s the strategic outcome that we’re seeking,” he said.
While the IRA has been a boon to solar companies, it also has frustrated Korean firms like SK, Hyundai and Kia Motors, who say that the law’s electric vehicle incentives could hit them hard just as they pour billions into American — and Georgian — manufacturing in this sector.
As written, the law’s $7,500 tax credit for buyers of new models only applies to EVs with final assembly in the U.S., Canada or Mexico.
Kia, Hyundai and Genesis all have plans to make EVs in the United States, but in the meantime, their made-in-Korea models have become relatively more expensive as a result of the law.
Mr. Ossoff’s Senate colleague, Democrat Raphael Warnock, last Thursday introduced legislation that would delay the final assembly requirement for three years.
Batteries are another battleground. Half of the incentive relies on battery being assembled in North America, while the other half requires at least 40 percent of the battery’s critical minerals be sourced from the U.S. or its free-trade partners. That percentage ratchets up by 10 percent per year until reaching 100 in 2029.
SK and many other firms still source many of their raw materials from China and contend that it will take years to find alternative sources or create a recycling chain.
Asked about this, Mr. Ossoff would only say he’s in “high-level discussions with Korean auto makers and the administration about how to maximize the benefit for the state of Georgia.”
India’s ‘Limitless Opportunity’
In India, where Mr. Ossoff met with industrialists from Georgia-invested conglomerates like the Birla Group, Tata Sons and Mahindra, the senator sees “limitless potential,” and not just in one direction.
“This isn’t just about the potential for Indian FDI in Georgia. This is also about Georgia farmers getting a fair shake to sell into the Indian market and in Georgia businesses gaining the the understanding and the access — both market access and just practical business access — to a 1.2 billion strong market,” he said, noting the prospects for the growth in Georgia’s “globally competitive” manufactured exports as well as services like fintech.
The U.S.-India relationship in technology, he said, could help provide a framework for setting global “terms of digital exchange,” including data privacy standards.
“The flow of data —proprietary business data and personal consumer data — has to be mediated by rules of the road that protect the integrity of that data, protect the privacy of consumers and protect the intellectual property of businesses.”
Through the trip he also hoped to strengthen strategic and security ties with the world’s largest democracy while underscoring the importance of interpersonal exchanges, underpinned in Georgia by an Indian-origin diaspora of more than 100,000 people.
“I think it was a great trip, not just because of the economic diplomacy, but because of the personal relationships that I built and the warmth of the people-to-people and cultural relationships that that can be built when you bring a delegation like that,” he said.
He told a Khabar reporter he believes Georgia should open a trade office in India, in either Mumbai or Delhi, both of which made his itinerary.
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