Mobility Portal, Spain
Date: February 23, 2024
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By Mobility Portal
United States

The US Department of Energy is offering $710 million in loans for EV technology projects

The US Department of Energy announced preliminary approval for nearly $710 million dollars in loans to EV technology manufacturing companies. SK Siltron CSS will receive 544 million dollars to expand a plant in Bay City, Michigan.
US Department of Energy $710 million in loans for EV technology

The US Department of Energy announced preliminary approval for nearly 710 million dollars in loans to electric vehicle (EV) technology manufacturing companies, although the Biden administration still has 221.8 billion dollars in loan capacity to finance clean energy projects.

South Korean firm SK Siltron CSS will receive 544 million dollars to expand a plant in Bay City, Michigan, which produces high-power silicon carbide wafers used in EVs.

Thus, about 200 jobs would be created in both the construction and production sectors to manage the plant expansion, the department stated in a release.

Read more: Following the increase in eTruck registrations, the US could add 262,000 new jobs with an approximate salary of $73,000

“This project is a significant step towards ensuring a robust and resilient supply chain in the United States, and we are proud to bolster domestic semiconductor manufacturing,” states Jianwei Dong, CEO of SK Siltron CSS.

President Joe Biden visited the Bay City factory in November 2022 and highlighted its production of material for chips powering smartphones, washing machines, hospital equipment, automobiles, among other products.

American Battery Solutions separately received conditional approval for a 165.9 million dollars loan to expand its electric vehicle battery assembly operations in Springboro, Ohio, and Lake Orion, Michigan.

Both facilities could employ up to 460 people.

Jigar Shah, director of the energy department’s loan program office, told Reuters in Detroit that in the last two months, his office has received funding requests worth 80 billion dollars from “very sophisticated players.”

In total, the department has disbursed 34.43 billion dollars as of December 31, 2023. It received loan applications worth 263.1 billion dollars by the end of January.

Projects and jobs depend on companies closing loans and utilizing the money.

The US Department of Energy finalized a 2.5 billion dollars loan in December 2022 to finance the construction of a battery plant by a joint venture of General Motors and LG Energy Solution.

However, Ford and its battery partner SK On have not finalized a $9.2 billion loan proposal from the Department of Energy to build three battery plants in the US.

We are fully anticipating that they will close the loan,” Shah states.

Energy Secretary Jennifer Granholm said last August that the agency would offer ten billion dollars in loans and another two billion dollars in grants to help convert factories to produce electric vehicles.

“We hired specific people to really lean into getting people to use that. Many potential applicants are waiting in hopes of securing grants,” she says.

But he said his office “will lean towards good risks,” such as loans to projects aimed at producing critical minerals used in batteries and electronics, a sector dominated by China.

China is clearly over-supplying the market. Prices have come down. But government advisors believe that “by 2027 we will be short of critical mineral capacity,” Shah states.

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