ENERGY
JUST IN: U.S. Could Drastically Cut Foreign Reliance on Lithium Batteries, Report Says
By Laura Heckmann

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Lithium batteries are predicted to be one of the key technologies of the 21st century, powering everything from electric vehicles to military systems, power grids and industrial electronics.
By 2030, global demand for the batteries is expected to increase more than five times, and U.S. demand nearly six times. However, the U.S. battery supply chain is hampered by a heavy reliance on foreign imports and a lack of domestic support, said a report released Feb. 15, “Building a Robust and Resilient U.S. Lithium Supply Chain.” The report was released by Li-Bridge, a public-private alliance, which advocates for a robust and sustainable supply chain for lithium battery technology in North America.
The United States currently captures less than 30 percent of the economic value of each battery cell on the U.S. market, equating to approximately $3 billion value-added and 16,000 jobs. The remaining 70 percent comes from imported materials. China, by comparison, captures 90 percent, the report said.
The discrepancy is also a vulnerability – one that threatens both national and economic security, the report said. A military significantly reliant on foreign sources of advanced batteries remains “endangered,” it added.
“The U.S. military today does not have direct, domestic access to the most advanced lithium batters and chemistries to power its troops, vehicles, bases and weapons systems. Foreign countries, including some that are potential adversaries, also control the upstream and midstream, supply chain for those batteries,” the report read.
The Department of Energy organized Li-Bridge, which is managed by Argonne National Laboratory in Illinois. It is spearheaded by three industry trade groups: NAATBatt International, the New York Battery and Energy Storage Technology Consortium, and New Energy Nexus.
Li-Bridge’s vision for the lithium battery industry was inspired in part by the National Blueprint for Lithium Batteries, produced by the Federal Consortium for Advanced Batteries in 2021. The blueprint outlined a secure battery materials supply chain that supports long-term U.S. economic competitiveness, among others.
The Li-Bridge report identified 26 recommended actions to bring the United States up to speed, and two major goals – one for 2030 and one for 2050.
The 2030 goal asserts that the U.S. can double its 30 percent captured economic value figure to 60 percent, while the loftier 2050 goal aims at self-sufficiency – near-100 percent supply of domestic needs for lithium battery technology.
How the United States is going to get there is prefaced by how it got there in the first place, with the report citing three main challenges restricting industry.
The first was an insufficient return on investment on long-term projects. Projects along the battery supply chain require high initial investment in research and development and lengthy and expensive qualification periods.
The second was lengthy and uncertain timelines for permits and project approval. The blame for crippling and cumbersome timelines can be shared across the bureaucratic process, the appeals process and community resistance, the report said.
A third challenge identified was lack of access to critical minerals and raw and processed energy materials. Governments of other countries have been actively supporting efforts by their private companies to tie up available sources of supply internationally, outcompeting U.S. firms, the report said, putting them at a “severe disadvantage.”
Other challenges identified were lack of incentive for customers, lack of domestic technical know-how, limited sites served by reliable clean energy and lack of domestic suppliers.
Investment needs to be more attractive, it said. Investment incentives are needed to favor localization of production facilities, the report added. State and local government needs to streamline and standardize permitting processes to accelerate critical projects and develop shovel-ready industrial zones for energy materials and battery cell production.
The nation also needs to better support research and development, help companies access critical raw minerals and address a know-how gap in workforce training, were other objectives cited.
One specific recommendation for securing access to critical minerals was a consortium of companies for purchasing critical battery-related minerals and materials from domestic and foreign sources. This would improve purchasing power and reduce risk by providing access to a more diverse pool of material suppliers, the report said.
The report called on Congress to address permitting reform, accelerate critical mineral mining projects and appropriate funding for facilities.
Research and development needs to be directed toward partnership with federal agencies such as the Defense Advanced Research Projects Agency and Advanced Research Projects Agency–Energy.
Lastly, industry needs to work together to define industry needs – which includes solving the problem of a workforce gap and training needs, the report said.
Li-Bridge experts who compiled the report said by implementing their recommendations, U.S. industry can not only double the value-added share by 2030, it could capture an additional $17 billion in direct value-added annually and create 40,000 jobs.
While they said they are “optimistic” this can be accomplished, innovation must occur at all levels. Implementing the recommendations will “put the U.S. lithium battery supply chain firmly on the path to achieving … sustainable competitive advantages,” the report said.
According to a Li-Bridge press release, the report complements a series of recent government initiatives with the same goal: strengthening the country’s battery industry. Initiatives include the Inflation Reduction Act, the Infrastructure Investment and Jobs Act and the CHIPS and Science Act.
Topics: Energy, Battery, Supply Chain
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