Technology

US charges up home-grown green battery market with $7bn fund for supply chains

Washington opens coffers on first $3bn-plus tranche aimed at weaning country off unstable global supply chain while building domestic battery manufacturing sector

. Battery energy storage.
. Battery energy storage.Foto: The Bureau of Land Management courtesy of NextEra/Flickr https://creativecommons.org/publicdomain/mark/1.0
  • Tim Ferry
The US Department of Energy (DoE) will begin deploying the $60bn allotted it under the bipartisan infrastructure law passed year with more than $7bn going into strengthening the country’s battery manufacturing supply chain as demand gears up for electric vehicles (EVs) and power storage systems.

The DoE will offer the first round of $3.16bn to boost advanced battery manufacturing and recycling as part of the Biden administration’s ambitions of reorienting the automobile market towards electric vehicles (EVs) by 2030 while reducing national carbon emissions. The remainder is to be awarded in future financing rounds.

The Biden administration’s targets of 50% of US auto sales in EVs by 2030 and 100% clean power production by 2035 both depend heavily on large supplies of lithium-ion (Li-ion) batteries, most of which are manufactured outside of the US and require critical minerals often sourced from hostile or politically unstable nations.

“President Biden’s historic investment in battery production and recycling will give our domestic supply chain the jolt it needs to become more secure and less reliant on other nations—strengthening our clean energy economy, creating good paying jobs, and decarbonising the transportation sector,” said Energy Secretary Jennifer Granholm.

“Positioning the US front-and-centre in meeting the growing demand for advanced batteries is how we boost our competitiveness and electrify our transportation system.”

Secretary Granholm touted the battery supply chain initiatives at a ribbon-cutting for the Facility for Rare Isotope Beams at Michigan State University. Michigan remains a hub for US auto manufacturing, and US carmakers have recently unveiled new EV product lines.

“The future of mobility is electric – and this support could help to ensure Michigan remains on the forefront of innovation by shoring up our supply chains for advanced battery technologies necessary to deploy the next all-electric fleet,” said US senator Gary Peters, of Michigan.

The Battery Materials Processing & Battery Manufacturing initiative aims to bolster domestic battery and component manufacturing supply chains through investments into new, retrofitted, and expanded commercial facilities as well as manufacturing demonstrations and battery recycling.

Global demand for Li-ion batteries, used in everything from EVs and consumer electronics to large-scale energy storage systems, is expected to skyrocket over the next decade. But critical materials necessary for their production are often sourced from either hostile or politically unstable governments. A report issued by research firm S&P IHS Markit found 62% of graphite comes from China, while 76% of cobalt is mined in central Africa, both critical materials for the Li-ion anodes and cathodes, respectively.

“Responsible and sustainable domestic sourcing of the critical materials used to make Li-ion batteries – such as lithium, cobalt, nickel, and graphite – will help avoid or mitigate supply chain disruptions and accelerate battery production in America to meet this demand and support the adoption of electric vehicles,” the DoE said in a statement.

The DoE also announced a $60m initiative to support second-life applications for batteries, which aims to explore new processes for recycling key materials back into the supply chain and eliminating the need for new extraction.

The funding opportunities are the first to be released through a collaboration of the DoE's Office of Energy Efficiency and Renewable Energy and its newly established manufacturing and energy supply chains office.

The supply chains office emerged as part of the DoE’s restructuring this year to facilitate the goals of the bipartisan infrastructure law, which includes $7.5bn for EV chargers and $10bn for electric transit and school buses.

China produced 76% of the world’s Li-ion batteries last year, compared to 8% from the US, according to the Federal Consortium for Advanced Batteries. The consortium, led by the DoE, includes the departments of defence, commerce, and state, and lays out a plan for the US to take a much larger slice of the battery manufacturing sector

So critical is the sector that Biden last month invoked the Defence Production Act (DPA) to spur greater domestic output of metals and minerals necessary to manufacture batteries for electric vehicles and utility-scale clean energy storage systems.

This little-used law empowers the president with emergency authority to prioritise development of certain commodities, products, and productive capacity to strengthen the country’s industrial capacity.

(Copyright)
Published 4 May 2022, 16:35Updated 16 October 2023, 17:26
DOEJoe BidenEVsJennifer GranholmChina