The Department of Energy is awarding $2.8 billion in grants to 20 companies across the US that will promote the production of materials to make EV batteries domestically, the Biden administration announced today. The funding comes from the Bipartisan Infrastructure Law, and it'll be part of a new "American Battery Materials Initiative," which aims to secure a supply of minerals for EVs and electric infrastructure (potentially things like home batteries). Given that the Biden administration wants to make EVs half of new US car purchases by 2030, we'll need a serious boost in battery production before then.
"The U.S. and its allies currently do not produce enough of the critical minerals and battery materials needed to power clean energy technologies," the Biden admin wrote in a briefing. "China currently controls much of the critical mineral supply chain and the lack of mining, processing, and recycling capacity in the U.S. could hinder electric vehicle development and adoption, leaving the U.S. dependent on unreliable foreign supply chains."
The new funding will support projects that aim to develop enough battery-grade lithium to build 2 million EVs annually, as well as enough graphite and nickel to produce 1.2 million and 400,000 EVs annually. It'll also enable some groundbreaking endeavors, like building the first lithium iron phosphate cathode facility, as well as the first large-scale lithium electrolyte salt production facility, in the US.
After being matched by recipients, the Biden admin says the $2.8 million grants will lead to an investment of more than $9 billion towards building EV batteries. Car makers will also need more local supply sources if they want to build EVs that take full advantage of the Biden admin's new $7,500 tax credit, which require batteries and minerals produced in the US.