The energy provisions in the recently passed congressional Inflation Reduction Act (IRA) are beginning to bear fruit. Standing to get $35 million in government subsidies for every gigagwatt-hour of cell storage capacity produced, battery suppliers are stepping up their efforts in the United States.
As the Wall Street Journal reports, Norwegian battery maker Freyr and energy conglomerate Koch Industries Inc., are accelerating plans to build a multibillion dollar battery plant in Coweta County, Georgia, with Freyr’s CEO Tom Einar Jensen citing the IRA as the reason for speeding up the partnership’s timeline.
Unlike many other projects, which are heavily focused on the EV battery value chain, the Koch Industries/Freyr partnership will supply lithium-Ion batteries primarily for the energy storage market.
According to the Wall Street Journal, “the first phase of the project in Coweta County, Ga., will bring online 34 gigawatt-hours of annual cell production at a projected cost of $1.7 billion. (…) A second phase to expand the Georgia plant could increase the cell capacity further and add production of complete energy-storage units or battery inputs such as cathodes or anodes. The total investment is expected to reach $2.6 billion by 2029.”
The project, which is expected to create more than 720 jobs, is another case in point for states taking on a more active role in securing critical mineral supply chains.
According to Jensen, the partners decided to locate the project in Coweta County “in part because of an undisclosed financial package the county offered together with the state of Georgia.” As outlined in the press release issued by Governor Bryan P. Kemp’s office on the project, the state is looking to cultivate a “vertically integrated supply chain that will help companies increase efficiencies by reducing the reliance on imported materials.”
Earlier this fall, the State of Michigan approved a “more than $200 million grant for Our Next Energy Inc.’s (ONE) planned EV battery factory in Van Buren Township, Michigan. The company, an EV battery startup spearheaded by a former leader of Apple Inc.’s secretive car project, plans to invest $1.6 billion into the project, which is slated to be fully operational by the end of 2027 and have the capacity make battery cells for about 200,000 EVs annually.”
Also in October, the State of Louisiana entered into a partnership with Ucore with a significant incentive package to establish a rare earth separation facility in the state. The package includes $9.6M in tax incentives and payroll rebates over the first ten years of operation.
Even some cities are getting into the act. In June, the city of Stillwater, Oklahoma approved a $7 million incentive package for USA Rare Earth’s vertically-integrated rare earth metallization and permanent magnet manufacturing plant, a $100 million investment. The company recently announced it will partner with Oklahoma State University on materials science initiatives.
States like Oklahoma, Texas and Kansas have also attracted EV battery makers as automakers scramble to lock down supplies and policy stakeholders work to create frameworks conducive to attracting investment into these critical industries.
In the coming weeks and months, ARPN will continue to feature more examples of state level public-private cooperation or formalized public private partnerships (PPPs) to sustainably strengthen domestic critical mineral supply chains.