(Credit: Pixabay)A joint venture between General Motors and LG Energy Solution is receiving a $2.5 billion loan to help build lithium-ion battery cell manufacturing plants.
The loan is part of an initiative by the United States government to enhance domestic battery production and to meet the growing demand for electric vehicles. The General Motors and LG Energy Solution joint venture is called Ultium Cells and the manufacturing facilities will be built in Michigan, Ohio, and Tennessee.
The Biden Administration has an expansive energy plan that calls for an increase in manufacturing and operations of renewable materials and electric vehicle infrastructure, among other initiatives. Legislation over the past year from the Bipartisan Infrastructure Law and the Inflation Reduction Act has started those processes.
In October 2022, Biden also launched the American Battery Materials Initiative. That effort, along with $2.8 billion in grants from the DOE, intends to build out the battery mineral and supply chain in the US. Overall, the US has a goal of EVs making up half of all new vehicle sales by 2030.
Ultium Cells was conditionally approved for the loan in July 2022. The loan calls for the joint venture to manufacture large format, pounce-type cells that use advanced chemistry to deliver more range.
The cells can be arranged in different combinations to provide clean and reliable energy for all vehicles, the DOE says. Ultium Cells will use the technology in coordination with GM’s target of eliminating tailpipe emissions from its new US light-duty vehicles by 2035 and producing more than 1 million EVs a year in North America by 2040.
This year GM has invested in Lithion Recycling to improve battery technology and materials sourcing, and the company extended an agreement with Cirba Solutions to recycle EV batteries. GM also formed a separate business entity called GM Energy that expands on the automaker’s existing energy management platform to offer microgrids, stationary storage, hydrogen fuel cells, solar products, bi-directional charring, and vehicle-to-grid applications.
The Ultium Cells loan was the first financing closed exclusively for a battery cell production project under the Advanced Technology Vehicles Manufacturing program. Financing from the program compliments the infrastructure law, which includes $7.5 billion for EV charging infrastructure, of which 35 states already have projects approved, and more than $7 billion for minerals needed for batteries, components, and recycling. The Inflation Reduction Act also includes $3 billion for the costs of loans for the program.
Across all of the DOE’s loan programs, there are 98 active applications totaling $104 billion in requested loans and loan guarantees as of the end of October.
