The other thing is a portion of that off-take is going to be for self-consumption for their development arm, no different than the factory in Ohio, which as an equity investor that is looking to take a meaningful amount of that volume for their own development pipeline. That creates a different perception to some of our partners around why do I want to buy a technology or modules from the competitor, right? Somebody that’s going to be competing with me, which our primary business model is to be a developer, finer business model is to be the IPP, the utility to own the generating assets to get the return on investment against the project to feed my competitor. To better position them to take market share from me is not in a position of strength that a lot of our partners choose to be in.
And there’s still uncertainty. I mean there’s a lot of things that are changing. As it relates to — I mentioned already, the potential duties supposed on true aluminum coming in from China and Southeast Asia. That’s another risk profile that somebody has to be willing to expect they could be glass specs. I mean, who knows what the next step in the journey is going to be. And all our partners know is that with First Solar. They completely de-risk those dimensions, and they’ve got a great partner who’s going to deliver a great product, great technology at a great price on top. So that’s a sense of where our customers, I think, view us. And our contracts, yes, we have penalties and there’s ways to potentially pay those penalties and customers potentially could break a contract and we’ll take those penalties, and we’ll get to sell that technology done into the marketplace to somebody else.
But, when they step back and reflected the significant amount of risk that they would be taking for small nominal impact that is uncertain whether it’s even a meaningful impact. It could even be a worse opposition for them, especially if they’re jeopardizing the domestic content on your ITC. Why would you want to do all that brain damage for potentially roll as any benefit or make yourself — put some in a worse position? As it relates to the factories and the start-ups, I mean the ROIC — every one of these factories that we start up sooner just accelerates the ROIC, especially for U.S. manufacturing. That means we get dollars faster — and so anything we can do to get product into the market faster just enhances the return on invested capital.
And as we see that ability — then as we think about alternatives for another factory, yes, we’ll factor that in and say that our ability from announcement to high-volume manufacturing if it’s a shorter time line than it potentially creates a lens that says that the payback obviously, could be more attractive for factoring.
Alexander Bradley: Just about a couple of numbers around the 7 Asian fees. We tenor Analyst Day that about 14% of the megawatts in our backlog at that point was subject to a termination convenience closed. If you look at that, I mean 86% of our alt scenario development that put themselves in a very difficult position because they have ongoing to see an contractual breach, which will make it very hard for them to seek financing and tax equity for a project going forward. But for the vast majority of our backlog, there is no ability to terminate for convenience. For those contracts that we do have that clause, which typically is when we have larger long-dated contracts, and we have a small portion of that contracts where we have subject some of the megawatts to nation book convenience.
We then have an agreed fee typically up to 20%, which we look to collect and the idea there being that we could then resell those modules and be at least may follow on that transaction. So just to give you some color on the numbers.
Operator: Our final question comes from Andrew Percoco from Morgan Stanley. Please go ahead.
Andrew Percoco: Thank you so much for taking my question. Mark, you sort of answered my question already, but I kind of just want to dive into the cost of capital environment. Obviously, having an impact on the market or the perceived economics of renewable. I’m just wondering if you’re seeing any developers or customers that maybe haven’t been big for solar customers historically that are maybe turning to your technology because maybe they see your technology and your supply chain as more bankable than someone else? [ph]UFLPA, ADCVD combined with a more expensive cost of capital environment. I’m just wondering if that’s becoming a bigger competitive advantage than it maybe was a year or two ago? Thank you.
Mark Widmar: I think Alex actually referenced it in his section, but if you look at our bookings this last quarter, we highlighted three large contracts that were over a gigawatt at that total booking time. One of them is a return customer that we made an announcement on with Longwood Energy. I think we made that right around September, around the September time frame. But then we announced there was two other new customers. One is an IPP and another is effectively an asset management entity with a portfolio company and multiple developers both new customers. We’re very happy with those in the first step of our journey of developing a deeper partnership with those counterparties. Look, they’ve come to First Solar for understanding of the unique value proposition and what we can provide.
Unique value proposition and what we can provide. One of them, in particular, I know who’s would have liked to have gotten on First Solar’s books earlier. We just didn’t have capacity. And so now when they look forward and they see there is some supplies you get out of ’27, 28, ’29. They want to secure some of that supply. They were lumped even on the books and ’24, ’25 and ’26, in particular, we did it on supply. So yes, I do think that the environment that we’re in right now and first solar capabilities to proposition, I think, are more compelling and is driving new customers into our portfolio and our overall contracted backlog, which is now north of 80 gigawatts. I mean just that can reflect on that number. I mean that’s a huge multiyear contracted backlog and commitments with dozens of different partners that uniquely understand First Solar and understand the value proposition that we can trade that enable the success of our business model.
Operator: And this concludes today’s conference call. Thank you for your participation, and you may now disconnect.
