Biden awards $2.8 billion to boost U.S. minerals output for EV batteries

WASHINGTON, Oct 19 (Reuters) – The Biden administration said on Wednesday it was providing $2.8 billion in grants to boost U.S. production of electric vehicle batteries and the minerals used to build them, as part of a an attempt to wean the country off supplies from China.

“By undermining American manufacturers with their subsidies and unfair trade practices, China has captured a significant share of the market,” President Joe Biden said Wednesday when announcing the awards. “Today we’re stepping up…to take it back, not all but bold goals.”

Albemarle Corp (ALB.N) is among 20 manufacturing and processing companies receiving U.S. Department of Energy grants to mine lithium, graphite, and nickel domestically, build the first large-scale lithium processing facility in the United States , build facilities to manufacture cathodes and other battery parts, and expand battery recycling.

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The grants, which go to projects in at least 12 states, mark the latest push by the Biden administration to help reduce the country’s dependence on China and other countries for the building blocks of the green energy revolution.

The recipients of the funding, first reported by Reuters, were chosen by a White House steering committee and coordinated by the Department of Energy with support from the Department of the Interior.

But the program does nothing to alleviate the permit delays faced by some players in the mining industry.

Albemarle is set to receive $149.7 million to build a facility in North Carolina to lightly process lithium-bearing rock from a mine it is trying to reopen. That facility would then feed into a separate U.S. plant that the company said in June would double the company’s lithium production for electric vehicle batteries.

Albemarle, which also produces lithium in Australia and Chile, said the grant “increases lithium processing speed and reduces greenhouse gas emissions from long-distance transport of raw minerals.”

Piedmont Lithium Inc (PLL.O), whose shares rose nearly 11% after the news, received $141.7 million to build its own lithium processing plant in Tennessee, where the company will initially process metal from Quebec and Ghana. Piedmont’s plans to build a lithium mine in North Carolina have been met with strong opposition.

Talon Metals Corp. (TLO.TO)which has a nickel supply agreement with Tesla Inc (TSLA.O), will receive $114.8 million to build a processing plant in North Dakota. This plant will process rock mined from its planned underground mine in Minnesota.

The grants are “a clear recognition that domestic production of nickel and other battery minerals is a national priority,” Talon said.

Other grants include $316.2 million to private company Ascend Elements to build a battery parts factory, $50 million to private company Lilac Solutions Inc for a demonstration plant for so-called direct mining technologies lithium, $75 million to private company Cirba Solutions to develop an Ohio battery recycling plant and $219.8 million to Syrah Technologies LLC, a subsidiary of Syrah Resources Ltd. (SYR.AX)to expand a graphite processing plant in Louisiana.

BIDEN’S GOAL

By 2030, Biden wants 50% of all new vehicles sold in the United States to be electric or plug-in hybrid models, along with 500,000 new electric vehicle charging stations. He did not approve of phasing out sales of new gas-powered vehicles by 2030.

Program-related legislation that Biden signed in August sets tough new battery and supply component requirements for $7,500 consumption tax credits for electric vehicles. A separate $1 trillion infrastructure act signed in November 2021 allocates $7 billion to ensure U.S. manufacturers can access critical minerals and other components to make the batteries.

The White House has said the United States and its allies are not producing enough minerals and critical materials used in electric vehicle batteries.

“China currently controls much of the critical mineral supply chain and the lack of mining, processing and recycling capacity in the United States could hamper the development and adoption of electric vehicles, leaving states States dependent on unreliable foreign supply chains,” the White House said.

In March, Biden invoked the Defense Production Act to support the production and processing of minerals and materials used for electric vehicle batteries.

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Reporting by David Shepardson in Washington and Ernest Scheyder in Houston; Additional reporting by Nandita Bose; Editing by Alexandra Alper; Bernadette Baum, Matthew Lewis, Paul Simao and Deepa Babington

Our standards: The Thomson Reuters Trust Principles.

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