US Awards $3B for EV Battery Production in 14 States

The Biden/Harris administration is awarding more than $3 billion to U.S. companies to boost domestic production of advanced batteries and other materials used for electric vehicles (EVs).

The Biden/Harris administration’s $3 billion investment is a significant step in bolstering domestic production of advanced batteries and materials critical for electric vehicles (EVs). This initiative is part of the broader strategy to enhance U.S. energy security, reduce reliance on foreign supply chains—particularly from China—and support the growth of a domestic EV industry, which in turn will help set off mass EV adoption in America.

China currently dominates the global battery supply chain, accounting for a large portion of the production of key components like lithium, cobalt, and nickel. By directing funding toward U.S. companies, the administration aims to create a robust, homegrown battery manufacturing sector that can meet the rising demand for EVs and renewable energy storage while also supporting clean energy goals.

The funds are expected to be allocated for research and development, the construction of battery manufacturing plants, and the scaling up of sustainable mining and refining practices for key materials. These efforts not only strengthen the U.S. EV market but also promote job creation, reduce the environmental impact of battery production, and help the nation lead in the global transition to a low-carbon economy.

The Biden administration’s latest allocation of $3 billion for 25 projects across 14 states is part of a larger push under the bipartisan infrastructure law passed in 2021.

By focusing on states like Michigan, North Carolina, Ohio, Texas, South Carolina, and Louisiana, the grants not only target economic growth and job creation in key regions but also strategically position the U.S. to compete with global players like China in battery production. The projects receiving funding are involved in processing key battery materials such as lithium and graphite or manufacturing critical EV battery components, helping to ensure that the U.S. can meet the rising demand for EVs while driving down emissions and advancing clean energy goals.

This round of funding is part of a broader effort led by President Joe Biden and Vice President Kamala Harris to accelerate EV adoption as a central element of their climate strategy, aiming to decarbonize the transportation sector.

“Today’s awards move us closer to achieving the administration’s goal of building an end-to-end supply chain for batteries and critical minerals here in America, from mining to processing to manufacturing and recycling, which is vital to reduce China’s dominance of this critical sector,” White House economic adviser Lael Brainard said.

The Biden-Harris administration’s emphasis on boosting domestic battery production is a critical part of its strategy to drive the U.S. clean energy transition while reducing reliance on foreign sources of critical minerals. As White House National Economic Council Director Lael Brainard highlighted, this push is essential for powering not only electric vehicles (EVs) but also the broader U.S. energy grid, homes, businesses, and the auto industry.

With nearly $35 billion invested so far, these efforts aim to create a resilient, domestic supply chain for critical minerals and battery components. The projects span key states such as Nevada, North Carolina, Michigan, Ohio, California, and Texas, with investments ranging from lithium mining and rare earth element production to the establishment of battery factories.

“We’re committed to making batteries in the United States of America,” Energy Secretary Jennifer Granholm said.

By fostering domestic production of advanced batteries and critical minerals, the administration seeks to bolster the nation’s manufacturing base, generate high-quality jobs, and position the U.S. as a global leader in the clean energy economy.

“We’re using every tool at our disposal, from grants and loans to allocated tax credits,” Brainard said, adding that the administration’s approach has leveraged more $100 billion in private sector investment since Biden and Harris took office.

Tarriffs and Tensions with China

In response to China’s dominance in processing and refining key minerals like lithium, rare earth elements, and gallium—along with its stronghold on global battery production—the U.S. has implemented strategic measures to mitigate vulnerabilities in its supply chains. As Lael Brainard, White House National Economic Council Director, explained, these “tough, targeted measures” aim to counteract unfair actions by China and strengthen U.S. energy and manufacturing security.

Among the recent actions is the finalization of higher tariffs on Chinese imports of critical minerals, such as graphite, which is essential for the production of EV and grid-storage batteries. These tariffs are part of a broader effort to encourage domestic production and reduce reliance on foreign adversaries.

Additionally, the U.S. administration has leveraged the 2022 climate law to incentivize domestic sourcing for electric vehicles sold in the U.S. This includes offering tax credits for EVs that meet stringent requirements for sourcing materials from the U.S. or its allies. By imposing restrictions on products from China and other “foreign entities of concern,” the administration is actively working to diversify and localize the supply chains for critical minerals, safeguarding national security and promoting economic resilience. These measures are designed to position the U.S. as a leader in the EV and clean energy industries while reducing dependence on China.

The Biden/Harris administration’s newly announced funding for 25 projects is set to create around 8,000 construction jobs and 4,000 permanent jobs, further supporting the U.S. clean energy and electric vehicle (EV) sectors. The projects will receive matching grants on a 50-50 basis, with companies required to invest a minimum of $50 million. This public-private collaboration, backed by federal funding from the infrastructure and climate laws, has rapidly transformed the U.S. battery manufacturing industry in recent years.

Private Investment and Recycling

In July, GM announced $39M in funding for EV battery materials startup Addionics, as one example of how private investment is growing the EV battery industry in America in addition to federal funding. In September, Redwood Materials announced a partnership with BMW of North America to recycle lithium-ion batteries from all electrified vehicles across the BMW Group. This partnership underscores both companies’ commitment to sustainability and closed-loop recycling, helping to reduce the environmental impact of battery production.

Next-generation EV Battery Technologies

As Matthew McDowell, an associate professor of engineering at Georgia Institute of Technology, noted, federal funding has significantly accelerated growth in the U.S. battery sector. He emphasized excitement for next-generation technologies, particularly solid-state batteries, which hold the potential to surpass lithium-ion batteries by offering higher energy density, enhanced safety, and faster charging times. These advancements could further revolutionize clean energy storage, making it more efficient and supporting the continued expansion of renewable energy sources and EV adoption. The infusion of funding and technological progress represents a vital step toward a more sustainable, energy-resilient future for the U.S.