DOE Provides Funding to Develop Domestic Battery Supply Chains

By Anjali Joshi

The U.S. Department of Energy (DOE) funding is one of the latest efforts of Biden Administration to develop a domestic EV battery supply chain. In early April, President Biden invoked the Defense Production Act (DPA) to boost the upstream supply of critical raw materials used in Li-Ion batteries. In mid-April, the DOE announced its first battery supply chain loan, under its Advanced technology Vehicles Manufacturing Loan Program (ATVM), to support the development of Syrah’s Resources’ graphite anode project in Louisiana. And on May 2, the U.S. Department of Energy (DOE) announced US$3.16 billion in funding, under the Infrastructure Investment and Jobs Act, to further ramp up the growth of the domestic battery supply chain.

Currently, the country is largely dependent on foreign production of critical minerals, refining, and Li-Ion batteries, especially from China. This makes U.S. battery production highly vulnerable to global supply chain disruption. The funding is the step taken by Biden Administration to plug the supply chain gaps and further its clean energy goals as well as national security. Currently, the country holds less than 2% of global lithium chemical and 0% of spherical graphite production.

The $3.16 billion will be allocated across the domestic battery supply chain, focusing on mid-stream processing to cathode, anode, and battery cell production. Out of the total, US$1.5 billion is allocated to material processing, which includes cathode precursors and graphite anode materials. US$1.45 billion is allocated among the manufacturing of cells (US$600 million), cathode (US$300 million), separator (US$200 million), and other components (US$150 million).

The remaining US$100 million will go towards the manufacturing of silicon anode, an alternative to graphite anode, which is gaining a lot of attention. Start-ups like Sila Technologies and Group14 are backed by global companies to develop high-performance silicon-based anodes. Recycling and second-life use of retired EV batteries will receive a total of US$210 million, out of which US$150 million will be directed towards the development of commercial-scale battery recycling and end-of-life infrastructure, and US$60 million for R&D.