Tuesday, July 23, 2024

Biden gives $2.8 billion to boost US metal production for electric car batteries


WASHINGTON (Reuters) – The Biden administration said on Wednesday it will award $2.8 billion in grants to boost U.S. production of electric car batteries and the metals used to make them, as part of an effort to wean the country off supplies from China.

Announcing the awards on Wednesday, President Joe Biden said: “By undermining American manufacturers with their unfair subsidies and trade practices, China has captured a significant portion of the market. Today we are moving forward … to take it back, not all. But bold goals.”

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

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The grants, which go to projects across at least 12 states, represent the latest push by the Biden administration to help reduce the country’s dependence on China and other countries for the building blocks of a 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 mitigate permit delays some in the mining industry are experiencing.

Albemarle is set to receive $149.7 million to build a facility in North Carolina to process lithium-containing rock from a mine it is trying to reopen. That facility will then feed a separate US plant that the company said in June would double the company’s production of lithium for electric car batteries.

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

Piedmont Lithium Corporation (PLL.O), whose shares rose nearly 11% after the news, was awarded $141.7 million to build its own lithium processing facility in Tennessee, where the company will initially process the metal obtained from Quebec and Ghana. Piedmont’s plans to build a lithium mine in North Carolina faced strong opposition.

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

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

Other grants include $316.2 million for privately owned Ascend Elements to build a battery parts plant, $50 million to privately owned Lilac Solutions Inc for a pilot plant for so-called direct lithium extraction technologies, and $75 million for private Cirba Solutions for expansion. Battery recycling plant in Ohio, $219.8 million for 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 cars sold in the United States to be electric or hybrid electric models as well as 500,000 new charging stations for electric vehicles. He did not support phasing out sales of new gasoline cars by 2030.

Legislation related to the program Biden signed into law in August sets a strict new battery component and sourcing requirements for $7,500 consumer electric vehicle tax credits. A separate trillion-dollar infrastructure law signed in November 2021 allocates $7 billion to ensure US manufacturers have access to critical metals and other components to manufacture batteries.

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

“China currently controls much of the critical mineral supply chain, and a lack of US mining, processing, and recycling capacity may hamper the development and adoption of electric vehicles, leaving the US 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 in electric car batteries.

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(Reporting by David Shepardson in Washington and Ernest Scheider in Houston.) Additional reporting by Nandita Bose. Editing by Alexandra Alper; Bernadette Bohm, Matthew Lewis, Paul Simao and Dipa Babington

Our criteria: Thomson Reuters Trust Principles.



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