Electric Vehicles

Biden Gives EV Battery Industry $3.1 Billion Kickstart
GM is constructing a manufacturing plant for Ultium EV battery cells in Lordstown, Ohio. Photo: GM

Biden Gives EV Battery Industry $3.1 Billion Kickstart

By Boris Kamchev - May 17, 2022

The Biden administration recently gave a $3.1 billion kickstart to domestic electric vehicle battery manufacturing. The fund is part of a plan to ween Americans off gasoline and onto EVs that includes expanding the national charging network and tax incentives for electric car buyers.

The U.S. is the world’s third-largest market for EVs, behind China and Europe. According to the U.S. Department of Energy, sales of passenger plug-ins (battery and hybrid) nearly doubled to 608,000 in 2021 from 308,000 in 2020. BEVs accounted for 73% of plug-in sales in 2021. Even so, just 4% of new cars sold in the U.S. in 2021 were electric, according to market researchers Canalys.

There are a few homegrown companies that produce EV batteries in the U.S., while Asian companies dominate globally. The funding will support grants for building, retrofitting or expanding plants and component manufacture, as well as recycling facilities. Funds will be channeled from President Biden’s $1 trillion infrastructure package. The package includes more than $7 billion to bolster the country’s battery supply chain, CNBC reported recently.

>Read more about electric vehicles in the United States.

Secretary of Energy Jennifer M. Granholm said the country can boost its competitiveness and electrify transportation by being at the forefront of meeting demand for advanced batteries.

“President Biden’s historic investment in battery production and recycling will give our domestic supply chain the jolt it need to become more secure and less reliant on other nations – strengthening our clean energy economy, creating good paying jobs, and decarbonizing the transportation sector,” she said.

A third of annual greenhouse gas emissions in the U.S. comes from transport. Many believe vehicle electrification is crucial to mitigating man-made climate change.

Defense Production

In April, Biden invoked the Defense Production Act to encourage domestic production of minerals required to make batteries for EVs and long-term energy storage. The president’s order could help companies to receive federal funding for feasibility studies for the extraction of materials for EV production, such as lithium, nickel, cobalt, graphite and manganese.

“These made-in-America batteries are going to help reduce emissions and create opportunities across the country,” White House National Climate Advisor Gina McCarthy said during a call with reporters at the beginning of May.

Many oil majors are investing in the development and production of lithium-ion batteries. It was ExxonMobil Corp. that first commercialized lithium-ion batteries in the 1970s. Nearly 50 years later, oil majors are contributing big data on extracting battery minerals like lithium and cobalt. 

Lubricant marketers are moving from traditional products to high-tech thermal management fluids in new battery systems. 

The administration set a goal of 50% of American car sales to be EVs by 2030 and has introduced tax incentives for buyers. It also pledged to replace almost 660,000 federal cars and trucks with EVs by 2035, CNBS reported. This target may be pie in the sky. The Environmental Protection Agency chided the U.S. Postal Service in a letter that said an electrification target of 10% was “far too low.” The Departments of Transport and Energy have allocated $5 billion to help states instal a national network of charging stations.