With surprising speed, and with the help of ample public incentives, a solar-energy manufacturing center has emerged in the upper Midwest that is helping to supply the world’s growing demand for clean power.

Michigan is clearly leading the way, followed closely by Ohio. But clean-energy supporters in both states worry that November’s elections, which replaced many Democrats who support such incentives with Republicans who oppose them, could dim one of the few economic bright spots each state enjoys.

The new manufacturing activity is showing up across both states.

Near Midland, Mich., Hemlock Semiconductor is completing a $1 billion expansion of its polycrystalline silicon production plant to supply a basic raw material in the manufacture of solar photovoltaic cells, which convert sunlight to electricity. The Hemlock plant is adding 300  new jobs by year-end.

Some 320 miles south, in the central Ohio city of Circleville, DuPont is building a $175 million, 162,000-square foot solar materials manufacturing plant that will employ 70 people.

In between the two plants are nine more new solar manufacturing facilities—six in Michigan and three others in Ohio.

The new solar manufacturing sector takes advantage of the upper Midwest’s history of advanced manufacturing, and the fact that many of the basic materials used to produce photovoltaic panels—polycrystalline in mid-Michigan, glass in the Toledo region, plastic films in Ohio, and machined parts in both states—were already being made in the region.

Both Michigan and Ohio have an abundance of shuttered manufacturing plants that can be readily converted to new uses and are close to highway, rail, and shipping supply lines in the center of the country. And both states have an army of unemployed or underemployed skilled manufacturing workers who had previously expressed their view in public and at the ballot box for a new economic development strategy that showed promise of putting people back to work. 

The new DuPont plant, part of which encompasses an existing facility that was idled in 2009, seems destined for expansion.

“Frankly, an even bigger challenge we’ve had is to invest quickly enough to keep up with market demand,” said John Odom, the global business director for DuPont Photovoltaic Fluoro Materials.

A Big Boost for Michigan
This year the world will generate 36,000 megawatts of energy from the sun, 14,000 megawatts more than last year, according to a number of market research firms. The growth in the industry’s generating capacity is equivalent to 14 large coal-fired power plants.

In comparison, in 1997 global demand for solar photovoltaic equipment totaled just 125 megawatts. Sales of photovoltaic cells and panels reached $24 billion in 2010, according to the European Photovoltaic Industry Association.

Much of that market is supported by public incentives in the United States, Europe, and Asia to build and install photovoltaic equipment.

Michigan has done extraordinarily well, leveraging the 2009 federal stimulus bill and an array of state manufacturing incentives, tax credits, and other public aid to produce $4.1 billion in public and private investment in the state’s solar manufacturing industry in the last three years, said Gregory Main, the chief executive of the Michigan Economic Development Corporation, a state agency.

In a national census of solar industry employment released last month, the Solar Foundation found that, with 6,300 jobs, Michigan ranked fourth in solar sector jobs behind California, Pennsylvania, and Texas.

In fact, a national center for the solar industry is emerging in Michigan’s Saginaw Valley, around Hemlock Semiconductor’s polycrystalline silicon plant. The Hemlock expansion, which involves constructing multiple facilities on a 500-acre site, is being built with the help of a $350 million state energy tax credit, Mr. Main said.

Nearby, in Midland, Dow Solar, a unit of Dow Chemical, plans a $249 million photovoltaic plant to make residential solar shingles, which generate electricity while serving the same purpose as a conventional roof. The plant will be built with $141 million in various state, federal, and local incentives.

Also in Midland, Evergreen Solar, a Massachusetts company, built a $25 million, 54,000-square-foot solar products plant that opened last year and employs 17 people. And in nearby Saginaw, Global Watt, a California manufacturer, began production this year in a $177 million, 70,000 square-foot plant that received $64 million in state tax credits and other incentives.

More plants are on the way, Mr. Main said. Suniva is awaiting a decision on its application for a $141 million federal loan guarantee to build a $250 million solar plant in Saginaw. And Clairvoyant Energy last year committed to a partnership with Ford Motor Company to install a solar manufacturing facility in a shuttered Ford auto assembly plant near Detroit.

Ohio Ramps Up
Ohio continues to ramp up, too. DuPont received $50.1 million in federal manufacturing tax incentives from the 2009 American Recovery and Reinvestment Act. It also gained $7 million more in state aid. That and other efforts, according to the Ohio Department of Development, has created 1,500 jobs in the state’s nascent solar manufacturing sector. The state also counts 100 other companies in Ohio’s solar sector supply chain, and anticipates the industry will continue to grow.

Toledo, Ohio, has become a center for producing flexible sheets of photovoltaic cells, called thin film, that were developed from research programs at the University of Toledo. The sheets combine layers of hair-thin semiconductors with non-silicon materials to generate power. First Solar just finished a 500,000-square-foot, $141 million addition to its existing photovoltaic thin film plant in Perrysburg, a Toledo suburb. The company, awarded a $16 million federal manufacturing investment tax credit, added 200 workers, bringing the plant’s employment to 1,100.

Xunlight, another new thin-film photovoltaic maker, received $5 million in state incentives to open a 122,000-square-foot, $20 million plant in Toledo that employs 200 people.

Early this year, Willard & Kelsey Solar Group is scheduled to start production in a 280,000 square-foot, $250 million thin film plant in Perrysburg that will employ 100 people and was built with nearly $20 million in state support.

Michael J. Cicak, the company’s chief executive and chairman, said that the company had already sold out all its production from the plant and added that Willard & Kelsey was looking 50 miles north to Tecumseh, Mich., for a second manufacturing plant.

Danger Ahead?
But an industry that relies on government incentives and assistance is also vulnerable to the winds of political change.

In both states, solar executives and political leaders expressed concern that the Democratic lawmakers both states sent to Washington, as well as the governors of both states who helped launch the solar initiatives—Jennifer Granholm in Michigan and Ted Strickland in Ohio—have been replaced by Republicans who’ve expressed skepticism about publicly financed incentives.

Michigan’s gubernatorial race generated scant debate on that or most other issues, largely because the contest was so lopsided in favor of Republican Rick Snyder. Mr. Snyder, a former computer company executive with no governmental experience, mostly touted bipartisanship and innovation as keys to Michigan’s comeback. And while he did mention “green collar” jobs in his campaign platform, the new governor has yet to take a clear position on the incentives that former Democratic Governor Jennifer Granholm leveraged.

In Ohio, however, the value of public incentives and two-year-old state legislation to support solar and other clean energy manufacturing became issues in the tight governor’s race. Now-former Governor Strickland, a Democrat, argued that state grants, loans, and tax incentives in the last three years helped to prompt nearly $750 million in new solar investment in Ohio and hundreds of new jobs.

But his successful Republican challenger, John Kasich, said that Ohio’s 2008 clean energy standard, which requires utilities to produce 25 percent of their electricity from solar and other “advanced sources” by 2025, would raise costs and was a government intrusion.

“You can’t mandate invention,” Mr. Kasich said.

China Syndrome
Further complicating the issue, particularly in Ohio, is a thorny dispute with China over its own incentives and support of solar manufacturing. China produces half of the solar panels in the world and has announced its intent to build 13 clean energy industrial zones and pay up to half the price of equipment in solar power projects while also supporting solar-powered electrical plants with a subsidy equivalent to 60 cents to 90 cents per watt of generating capacity.

In October, just prior to the election, the United States Trade Representative’s office announced it would investigate Chinese government support for manufacturers of solar, wind, and other clean energy products that compete with similar equipment now made in the Midwest. Chinese officials responded that the investigation could set off an economic impasse the United States could not win.

In an interview, Senator Sherrod Brown of Ohio, a Democrat and one of Capitol Hill’s strongest supporters of clean energy manufacturing, said he was concerned that so many Republican candidates in and outside Ohio had campaigned against incentives to encourage renewable energy manufacturing.

“Capital markets need to be assured,” Mr. Brown said. “It’s tough enough to raise money to build these plants.”

Solar industry analysts said that a confrontation with China could hit DuPont hard. The company’s new plant will manufacture Tedlar, a durable plastic film used to seal out effects of the weather from solar photovoltaic panels.

In an American industrial equivalent of a man-bites-dog story, most of the Tedlar produced in Ohio will be sold to manufacturers in China, who are now making half of the solar photovoltaic panels in a global market that is growing 30 percent annually.

While the tussle over China’s trade policies continue, however, clean energy advocates in Ohio have heard some encouraging words. Rob Nichols, a spokesman for the governor, said Mr. Kasich did not oppose Ohio’s renewable energy standard and would not seek to repeal it.

And, in Michigan, success may be prove to be the best advocate for clean energy manufacturing.

“I know some people have said some negative things, but I suspect that we will continue to pursue alternative energy production,” said Mr. Main, of Michigan’s development agency. “The track record in job growth has been so strong in our state. I can’t imagine us walking away.”

A version of this article appeared recently in The New York Times, and is used with the author’s permission. Mr. Schneider founded the Michigan Land Use Institute in 1995, lives in Benzie County, and is senior editor of Circle of Blue, a Traverse City based online news organization that reports on the global freshwater crisis. Read Keith’s blog about growth, environmental, and energy issues at Mode Shift.