The Biden administration has announced the allocation of more than $3 billion to U.S. companies to enhance domestic production of advanced batteries and materials used in electric vehicles (EVs). This initiative is part of a broader strategy to reduce China's dominance in battery production for EVs and other electronics.
A total of 25 projects in 14 states, including key battleground states like Michigan and North Carolina, will receive funding. The grants, part of the bipartisan infrastructure law approved in 2021, mark the second round of EV battery funding. The previous round allocated $1.8 billion for 14 ongoing projects.
The administration's goal is to establish a comprehensive supply chain for batteries and critical minerals within the U.S., covering mining, processing, manufacturing, and recycling. This effort aims to lessen China's stronghold on the sector and promote U.S. manufacturing.
The awarded companies are involved in processing lithium, graphite, and other battery materials, as well as manufacturing components for EV batteries. The grants are a key component of President Biden and Vice President Harris's strategy to promote electric vehicle adoption as part of the fight against climate change.
The U.S. government has also taken steps to address China's dominance in critical minerals and battery production. Measures include higher tariffs on Chinese imports of key minerals and incentives for domestic sourcing of EV components.
The awarded projects are expected to create 8,000 construction jobs and over 4,000 permanent jobs. Companies receiving grants are required to match the funding on a 50-50 basis, with a minimum investment of $50 million.
The infusion of funds from infrastructure and climate laws has significantly transformed the U.S. battery manufacturing sector in recent years. Experts are optimistic about the development of next-generation batteries, such as solid-state batteries, which hold the potential for increased energy storage capacity compared to lithium-ion batteries.
