The US Department of Energy (DOE) has announced a $15.5 billion package of funding and loans to enhance the EV value chain, primarily focused on retooling existing factories.
The package includes $2 billion in grants and up to $10 billion in loans, as well as a Notice of Intent (NOI) to make available $3.5 billion towards the country’s EV transition.
“President Biden is investing in the workforce and factories that made our country a global manufacturing powerhouse,” said US Secretary of Energy Jennifer M. Granholm.
“Today’s announcements show that President Biden understands that building the cars of the future also necessitates helping the communities challenged by the transition away from the internal combustion engine.”
Depending on their capital needs, manufacturers can apply to receive assistance via financial grants through DOE’s Office of Manufacturing and Energy Supply Chains (MESC) or preferable debt financing through DOE’s Loan Program Office.
The funding breakdown is as follows:
$2 billion for EV plant retrofits
$2 billion will be made available to spur the conversion of long-standing facilities to manufacture EVs and components.
Supported by President Biden’s Inflation Reduction Act, the Domestic Manufacturing Conversion Grants for EVs programme will provide cost-shared grants for domestic production of efficient hybrid, plug-in electric hybrid, plug-in electric drive and hydrogen fuel cell EVs.
The programme will expand manufacturing of light-, medium-, and heavy-duty EVs and components and support commercial facilities including those for vehicle assembly, component assembly and related vehicle part manufacturing.
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$10 billion for conversion projects
$10 billion will be made available in loan authority for applications under the Advanced Technology Vehicles Manufacturing Loan Program for automotive manufacturing conversion projects that retain high-quality jobs in communities that currently host manufacturing facilities.
Examples include retaining high wages and benefits, including workplace rights, or commitments such as keeping the existing facility open until a new facility is complete, in the case of facility replacement projects.
For projects that seek financing to convert or directly replace an existing factory that has high-quality jobs, DOE will assess the projected economic impacts of the facility conversion relative to the existing facility, including factors such as contribution to the local economy, employment history, anticipated employment and duration of its existence.
$3.5 billion to boost production
The DOE’s NOI to make available $3.5 billion in funding will expand domestic manufacturing of batteries for EVs and the nation’s grid, as well for battery materials and components currently imported from other countries.
The NOI – made possible by the President’s Bipartisan Infrastructure Law—represents the second round of funding for battery materials processing and battery manufacturing grants to support the creation of new, retrofitted and expanded domestic commercial facilities for battery materials, battery components and cell manufacturing.
The programme will also support communities with experienced auto workers and a history of producing vehicles, applicants with strong workforce practices and applicants who plan to create high-quality jobs.
The round of funding was made possible by President Biden’s Investing in America agenda.
Both the conversion grant funding opportunity and battery manufacturing notice of intent will be administered by the DOE’s Office of Manufacturing and Energy Supply Chains (MESC).
