WALBRIDGE, Ohio—Solar panels are part of any formula for fighting climate change, yet the U.S. makes few of them, since subsidized manufacturers in China dominate the market.

First Solar Inc. is trying to change that. It has just committed to building a new $680 million panel factory in Ohio. A key reason is the company’s confidence that Washington will have its back.

After years of decline, the fragile American solar industry is hoping for a turnabout bolstered by President Biden’s plans to make the U.S. electric grid carbon-free by 2035, and his insistence on a made-in-America transition that would create jobs and bolster industries deemed critical.

In seeking to “reshore” manufacturing that has moved offshore, the Biden administration is initially focusing on four industries to bolster with tax breaks or other government support. One is pharmaceuticals, whose importance the pandemic shows. The other three—semiconductors, advanced batteries and minerals crucial for electronics—are important for next-generation renewable energy. Many of the plans would require congressional approval.