Biden Allocates $3.1 Billion to Make EV Batteries in the US

President Joe Biden's administration is pushing hard to increase the adoption of electric vehicles (EVs) in the United States. It announced $3.1 billion in funding by the Department of Energy to help companies build new factories or retrofit current factories to make batteries for EVs in the U.S.

The latest funding is part of the $1 trillion Bipartisan Infrastructure Law that was enacted last year. The goal is to support domestic battery production to reduce America’s reliance on oil and other nations that supply the minerals for the batteries. This announcement comes as the price of gas has skyrocketed due to the Russian invasion of Ukraine and sanctions on Russian oil. 

In addition to the $3.1 billion in funding, the White House also announced it will allocate $60 million in grants for battery recycling programs.

According to Energy Secretary Jennifer Granholm, “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 decarbonizing the transportation sector.”

Lithium, cobalt, and other minerals needed for EV batteries are currently largely processed in Asia. According to London-based Benchmark Mineral Intelligence, China is responsible for 80% of the world’s raw materials needed for advanced batteries. 

The transportation sector—cars, trucks, commercial aircraft, and railroads—in the U.S. is a major contributor to the nation's greenhouse gas emissions. According to the EPA, approximately one-third of the nation's emissions can be attributed to transportation.

The Biden administration set a goal to have EVs make up half of all vehicle sales in the U.S. by 2030. Increased battery production and reduced costs are crucial to the adoption of EVs.

The $3.1 billion will be made available to companies in the form of grants to those who want to build plants in the U.S. The program stipulates companies must match the amount of the grant and the minimum grant is $50 million. This means that any new plants have to cost at least $100 million.

“These grants to grow U.S. battery manufacturing are going to create good-paying jobs, spur our economic competitiveness, and help us combat the climate crisis,” said U.S. Senator Catherine Cortez Masto.

Several automakers, like Ford and General Motors, announced plans to build battery plants in the U.S., which will now be boosted by the grants. Last fall, Ford announced plans to build two lithium-ion battery plants in Kentucky and a 3,600-acre campus in Tennessee that will include an additional battery plant and a recycling center. Battery production at the plants is slated to begin as early as 2025. 

General Motors also announced earlier this year that it will build its third battery plant in Lansing, Michigan. GM will start building the new battery plant this summer and it’s expected to open in late 2024. According to GM, the facility will have 50-gigawatt-hours of battery cell capacity when running full production.

There's a bigger sustainability issue at play with an EV-only future. British scientists have done the math to find we, as a planet, come up short of the resources to fully electrify automobiles. Simply put: EV adoption is a crucial part of the solution but electric cars alone won't save us.