Energy Department will lend G.M. and LG $2.5 billion to build battery factories.
The U.S. Department of Energy said on Monday that it would lend $ 2.5 billion to General Motors and LG Energy Solutions to build a battery plant, promote electric vehicles and promote the Biden administration’s plans to reduce its reliance on China for critical components. Announced.
GM and LG Energy, a South Korean battery maker, are partners of Ultium, a joint venture that uses funds to manufacture batteries in Ohio, Tennessee and Michigan. This loan, which requires companies to meet specific requirements, is the first loan in more than 10 years by a government program that Tesla provided $ 465 million to support the production of the first sedan, the Model S. ..
The US government has played an important and often unknown role in promoting electric vehicle technology. Many universities and entrepreneurs have received funding from the Defense Advanced Research Projects Agency in the Energy sector to develop batteries that charge faster than previous versions and contain more energy per pound. Some of these companies, such as Sila Nanotechnologies in Alameda, California and Solid Power in Louisville, Colorado, are approaching the manufacture of advanced batteries for major automakers.
According to the Department of Energy, the new Ultium plant is expected to provide more than 5,000 permanent jobs. GM announced that its Ohio plant in Lordstown will begin production of battery packs this year.
Domestic battery manufacturing can also help reduce the cost of electric vehicles. Batteries are heavy, so building them near a car factory will generally save you money.
Investing in Ohio and Michigan will help reassure Labor leaders and state officials not to be left behind by the electric vehicle boom. Much of the corporate investment in new electric vehicle and battery plants goes to southern states such as Tennessee, Alabama, and Georgia.
“We need to seize the opportunity to build advanced batteries at home, which is at the heart of this growing industry,” Energy Secretary and Governor of Michigan Jennifer M. Granholm said in a statement.
Separately, at a rare bipartisan exhibit, Congress hoped last year that the Biden administration would lay the groundwork for millions of electric vehicles and establish a domestic supply chain for battery manufacturing. The law has been passed.
The government will spend $ 7.5 billion on manufacturing electric vehicle chargers along major highways and more than $ 7 billion to establish a supply of lithium and other materials used to make batteries. China dominates lithium processing, and Ningde-based CATL is the world’s largest battery manufacturer.
