The U.S. Department of Energy (DOE) announced it would invest up to $3.5 billion more in the domestic battery supply chain to produce batteries and the critical minerals used to make them.
According to the Associated Press, the DOE is looking to strengthen the U.S.’s battery supply chain because the estimated demand for lithium is expected to increase tenfold by 2030. Lithium ion is currently the dominant battery type for EVs as well as clean electricity storage.
Some officials and industry experts are worried the supply of battery materials will be unable to keep pace with demand while others are concerned that the global battery materials sector is anchored too heavily to Asia.
“I’m worried that we may not catch up and end up in the same situation we’re in now with the semiconductor industry,” said Jodie Lutkenhaus, a professor of chemical engineering at Texas A&M University. “The same thing can happen with batteries if we don’t diversify where batteries are made and where materials are sourced. It is essential that the U.S. participates in battery production and manufacturing so that we can avoid global shortages of batteries, should that ever happen.”
Tom Moerenhout, a professor at Columbia University’s Center on Global Energy Policy, said that it will be a massive challenge to bolster the global supply of critical minerals in order to meet the projected battery demand by 2030. However, Moerenhout said that he believed the growing price of lithium will make alternative battery types more attractive in the coming years.
Previously, the Bipartisan Infrastructure Law signed in 2021 assigned $6 billion in total funding to battery material processing and manufacturing projects. The first round of that funding went towards financing 15 projects. The next round of funding from the bill will likely go towards supporting similar projects as well as companies that rely on alternative chemistries like flow and sodium batteries.
