WASHINGTON – Continuing its push to dramatically increase sales of electric vehicles, the Biden administration on Monday announced $ 3.1 billion in funding for U.S. companies that manufacture and recycle lithium-ion batteries.
The investments in last year’s 1 trillion infrastructure law differ from an executive order issued by President Joe Biden this spring, which called for the Defense Production Act to encourage the production of lithium and other important minerals used in electric vehicle power.
Energy Secretary Jennifer Granhome said the new program would provide grants to companies that now process or recycle battery components to augment the domestic supply of dominated markets in China and other countries. The grants will support Biden’s goal of strengthening U.S. energy independence and half of all vehicle sales in the U.S. by 2030 for electric vehicles, he said.
Electric cars accounted for 4.2% of new car sales in the first quarter of this year, according to Edmunds.com.
“Being at the forefront and center of the United States to meet the growing demand for advanced batteries is how we increase our competitiveness and electrify our transportation systems,” Granhome said in a statement.
Granhome, the former governor of Michigan, announced the battery initiative during a visit to his home state in November to highlight the provision for clean-energy in the bipartisan infrastructure law signed by Biden.
He said the grant program would “push our internal supply chain to make it more secure and less dependent on other countries,” while creating better-paying jobs and reducing global warming greenhouse gas emissions.
“We need a lot of batteries. And we want American workers to make these batteries in America,” Gina McCarthy, Biden’s climate adviser, told a separate briefing at the White House on Monday.
The ৩ 3 billion grant will be allocated to 30 companies, officials say, and represents about half of the $ 7 billion approved under the Infrastructure Act to improve the domestic battery supply chain.
Companies need to match grants on a 50-50 basis with a minimum investment of $ 50 million, the Department of Energy said. The money will go to companies that could create new, retrofitted or expanded processing facilities as well as battery recycling programs, the department said.
The focus on battery processing and recycling is part of a larger effort to move the country from gas-powered vehicles to electric vehicles and fight climate change.
An executive order dated March 31 aimed at boosting lithium and other important mineral mines does not waive or suspend existing environmental and labor standards, the White House said. Or it doesn’t address the major barriers to internal mining growth: it takes a year-long process to get a federal permit for a new mine.
Nevertheless, the mining industry and supporters of Congress cheered Biden’s use of the Defense Production Act.
Rich Nolan, president and CEO of the National Mining Association, called it a historic step by the White House to “recognize the importance of minerals and push for the electrification of the car industry.”
But unless the administration takes swift action to approve new hard rock mines, “we run the risk of feeding mineral dominance to geopolitical rivals like China and Russia,” Nolan said.
As of March 31, more than 2.5 million plug-in electric cars had been sold in the United States, of which more than 800,000 had been sold since Biden took office, the Department of Energy said. Battery costs have dropped by more than 90% since 2008, while performance has increased.
“The future of mobility is electric,” said Sen. Gary Peters, D-Mitch, who attended the event with Granhome in Lansing, Mitch. The energy grant “could help Michigan stay at the forefront of innovation. Chain up our supply for the advanced battery technology needed to build the next all-electric fleet,” he said.
U.S. carmakers applaud the grant program.
“Ensuring a stable and reliable supply of locally made EV batteries, battery components and processed minerals will be vital as Ford leads the electric vehicle revolution,” said Steven Crowley, chief policy officer at Ford Motor Company.
“The United States is finally in the global battery race and the larger race for the future,” said Abigail Wolf, vice president of critical mining strategies at SAFE, an exchange group that favors U.S. energy and transportation security.
“It’s about getting the money out of the door of projects that now rely on the DOE that will make us stronger in the short and long term,” he said.