DOE doubles down on battery manufacturing supply chain with $2.8bn

The first set of projects funded by $2.8 billion from the US Infrastructure Law will expand domestic battery manufacturing for electric vehicles (EVs) and the electrical grid as well as for materials and components heretofore imported.

Twenty companies will receive the combined $2.8 billion from the US Department of Energy (DOE) to build and expand commercial-scale facilities in 12 states.

Currently, the majority of all lithium, graphite, battery-grade nickel, electrolyte salt, electrode binder and iron phosphate cathode material are produced outside the US and China controls the supply chains for many of these key inputs.

These facilities and projects will thus be poised to extract and process lithium, graphite and other battery materials, manufacture components and demonstrate new approaches, including manufacturing components from recycled materials.

The funding will support:

• Developing enough battery-grade lithium to supply 2 million electric vehicles annually
• Developing enough battery-grade graphite to supply approximately 1.2 million EVs annually
• Producing enough battery-grade nickel to supply approximately 400,000 EVs annually
• Installing the first large-scale, commercial lithium electrolyte salt (LiPF6) production facility in the United States
• Developing an electrode binder facility capable of supplying 45% of the anticipated domestic demand for binders for EV batteries in 2030
• Creating the first commercial scale domestic silicon oxide production facilities to supply anode materials for an estimated 600,000 EV batteries annually
• Installing the first lithium iron phosphate cathode facility in the United States

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This funding is the first phase of $7 billion in total provided by the President’s Bipartisan Infrastructure Law to strengthen the domestic battery supply chain by supporting upstream materials processing to create the precursor materials for batteries.

The DOE has stated its anticipation of moving quickly on additional funding opportunities to continue to fill gaps in and strengthen the domestic battery supply chain.

DOE’s Office of Manufacturing and Energy Supply Chains (MESC) will manage the portfolio of projects with support from its Office of Energy Efficiency and Renewable Energy’s Vehicle Technologies Office. 

The President also announced the launch of the American Battery Material Initiative, an effort to align federal investments and activities, domestic and international, to accelerate the development of the full end-to-end battery supply chain. This includes critical minerals and materials needed to meet production and deployment goals.

The Initiative will be led by DOE, with support from the Department of the Interior, and work closely with the Partnership on Global Infrastructure and Investment and the Department of State.

Together, they will aim to align and leverage programs and efforts across the Federal government to support and grow the battery supply chain, including resources through the Bipartisan Infrastructure Law and Inflation Reduction Act.

The Initiative will coordinate domestic and international efforts to accelerate permitting for critical minerals projects.