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The Biden administration released a battleplan for strengthening
the US lithium-ion battery industry 8 June, taking another step
forward in support of its decarbonization and electrification
targets.
At the same time, it promised a task force to tackle related
supply chain issues, and warned it is considering tariffs on
imports of at least one key electrification component.
Spurred by Executive Order 14017, and a
100-day deadline for the reviews demanded, the National Blueprint for Lithium
Batteries aims to transform US capabilities in the storage and
electric vehicle battery sector, create jobs, and pare back
reliance on imports and overseas supply chains over the next
decade.
February's executive order wasn't just concerned with batteries,
as the administration sought to tackle supply chain bottlenecks and
shortages in the critical minerals, semiconductor, and
pharmaceutical industries too. On 8 June, the administration said
it would establish a supply chain disruptions task force to address
what it called "mismatches" in near-term supply and demand
The centerpiece of the administration's response was the
blueprint, helmed by five goals:
Secure access to raw and refined materials and discover
alternates for critical minerals for commercial and defense
applications;
Support the growth of a US materials-processing base able to
meet domestic battery manufacturing demand;
Stimulate the US electrode, cell, and pack manufacturing
sectors;
Enable US end-of-life reuse and critical materials recycling at
scale and a full competitive value chain in the US, and;
Maintain and advance US battery technology leadership by
strongly supporting scientific R&D, STEM education, and
workforce development.
To aid the quest, the Department of Energy (DOE) will convene a
stakeholder roundtable on 14 June.
The blueprint, task force, and other moves are "the strongest
indication yet of North America's ambitions to build a local
battery supply chain to ensure supply of this," said IHS Markit
Research and Analysis Director Sam Wilkinson.
"Today, over 80% of li-ion battery cell manufacturing is located
in China, and we expect this to fall as major economies push for
localized battery manufacturing in order to secure supply," he
added.
Industry representatives were enthusiastic about the result of
the reviews.
"The Biden administration understands that we can't build a
clean energy future that's wholly based on imports," said Lindsay
Gorrill, CEO of Couer d'Alene, Idaho-based battery manufacturer
KORE Power.
"Investing in the US energy storage supply chain will turn
today's vulnerability into tomorrow's opportunity. It's an
opportunity we can't afford to miss," he added.
Stimulating demand in the US for batteries and other energy
storage technologies is the "single most important determinant to
greater investment and innovation in American battery manufacturing
capabilities," Energy Storage Association Interim CEO Jason Burwen
added separately.
Zero Emission Transportation Association Executive Director Joe
Britton said that if fully implemented, the recommendations are set
to put the US on a path for sustainable development that will
benefit not only electric vehicles (EVs), but the "entire clean
energy economy" in the US. "It's paramount for Congress to now
advance the policies that will drive consumer adoption of EVs
called for," he added.
At the end of May, the Biden administration released its fiscal
year 2022 spending plan, which requires congressional approval. The
budget called for rebates to
subsidize EV purchases by consumers and direct spending on federal
purchases of EVs that would reach close to $1 billion in FY 2022.
In addition, a new tax credit would be created for purchases of
medium- and heavy-duty zero emission trucks.
Also, the budget envisions tax credits worth $236 million in FY
2022 for installation of EV chargers, as well as hundreds of
millions more to upgrade the power transmission system, which would
benefit EV users. The DOE budget request seeks $45 million for its
minerals sustainability program, including extra funding for
critical minerals efforts.
The US Chamber of Commerce expressed support for what the
pro-business lobby group regarded as a "deliberative,
evidence-based approach." Chief Policy Officer Neil Bradley said in
a statement that crafting "pragmatic, balanced approaches,"
including critical mineral extraction permitting reforms, was
paramount.
Meantime, analysis released 9 June by the California Energy Commission
shows the state will need nearly 1.2 million public and shared
chargers by 2030 to meet the fueling demands of the 7.5 million
passenger plug-in EVs anticipated to be on California roads. A
September 2020 executive order by California Governor Gavin Newsom
requires all new passenger vehicles sold in the state to be
zero-emission by 2035.
Mining options
All those EVs, as well as the storage batteries, solar panels,
and wind turbines require base metals such as copper and nickel,
critical minerals, and rare earth minerals that the US doesn't
produce enough of at the moment to meet future expectations.
So, part of the journey toward greater self-sufficiency in the
energy transition, the White House admitted, could involve mining
more of such raw materials.
The Department of Interior is set to establish a working group,
which will also involve the Department of Agriculture and the
Environmental Protection Agency, to identify sites where critical
minerals could be produced and processed in the US, the White House
said, although it made sure to note that this would include
"adhering to the highest environmental, labor, and sustainability
standards."
The administration also plans to establish an interagency team
that will identify gaps in critical mineral statutes and
regulations that may need to be updated, it said.
In addition, the DOE Loan Programs Office, through its Title 17
Renewable Energy and Efficiency Energy Projects solicitation, has
more than $3 billion in loan guarantees available to support
efficient end-use energy technologies, such as mining, extraction,
processing, recovery, or recycling technologies, the White House
said in a fact sheet on the plans.
However, Institute for Energy Research President Thomas Pyle
said the plans on additional funding and mining don't go far
enough, arguing the administration should offer loans with less
strictures and give the green light to mines with existing permit
applications before the federal government.
Pyle said there are four copper mines the nonprofit believes
should receive backing: the Pebble Mine in Alaska; the Resolution
mine in Arizona; the Rosemont mine, also in Arizona; and the Twin
Metals mine in Minnesota. President Joe Biden expressed opposition to the
controversial Alaskan project while on the campaign trail in
2020.
Existing tools not forgotten
In its efforts to foster greater growth in the US battery
sector, the White House said DOE will also rely on an existing
device in its toolbox, highlighting the capabilities of the DOE's
$17 billion Advanced Technology Vehicles Manufacturing (AVTM) Loan
Program.
The last ATVM loan was issued in 2011. The ATVM program closed
on about $8 billion in loans to five companies in its first phase
as the Obama administration sought to kickstart a US economy
battered by banking woes, tumult in the housing sector, and what
became known as the Great Recession.
Among the borrowers was Tesla, which received a $465 million
loan and went on to become the world's largest EC manufacturer to
date as well as a major player in solar and battery storage.
DOE declined to comment on whether any applications for ATVM
program funding had been received in 2021.
The Trump administration tried to goose the domestic critical
mineral sector through the ATVM program. The Trump-era DOE issued a clarification in
December 2020 about ATVM program applications, inviting aspirant
borrowers involved in the production, manufacturing, recycling,
processing, recovery, or reuse of critical minerals and other
minerals.
Previously, the program only provided loans to automotive or
component manufacturers for "re-equipping, expanding, or
establishing manufacturing facilities in the US that produce
fuel-efficient advanced technology vehicles or qualifying
components, or for engineering integration performed in the US for
advanced technology vehicles or qualifying components."
But a 1 February deadline for US critical mineral project
developers came too early, sources told IHS Markit at the
start of 2021.
Tariff strikes
The ATVM program isn't the only tool its predecessor used that
the Biden administration is eyeing in its quest to reverse decades
of losing ground to China. Tariffs are also a possibility, it
said.
The Department of Commerce is set to evaluate whether to
initiate an investigation into neodymium magnets, which are also
known as permanent magnets and used in the drive motors for hybrid
and electric vehicles plus wind turbine electric generators among
other things, the White House said. The investigation would be
under the remit of Section 232 of the Trade Expansion Act of 1962.
Section 232 was used to impose tariffs on steel and aluminum
imports by the Trump administration.
But that isn't all. The administration plans to establish a
"trade strike force" led by the US Trade Representative to propose
"unilateral and multilateral enforcement actions against unfair
foreign trade practices" that have hurt critical supply chains.