The U.S. Department of Energy announced a $754.9 million loan on Dec. 17 to Australia-based Novonix, to open a synthetic graphite manufacturing facility in Chattanooga, Tennessee.
“This announcement is the culmination of years of hard work and is another critical milestone for our anode materials business towards our target production of 150,000 [tonnes per annum] in North America,” Novonix CEO Chris Burns said in a statement.
“Recent announcements from China to further scrutinize the export of battery-grade graphite to the United States highlight the importance of domestic production of high-performance, battery-grade synthetic graphite,” he said.
China currently holds 95 percent market share for battery-grade graphite, according to Benchmark Minerals Intelligence, and the country will restrict exports to the United States based on end use.
Novonix is a leading battery materials company headquartered in Brisbane, Australia. Its new Tennessee facility would make synthetic graphite for use in electric vehicle batteries. It is scheduled to begin commercial production next year.
At full capacity, the company expects the plant to make enough synthetic graphite for lithium-ion batteries to power 325,000 electric vehicles per year. The company already has agreements with Panasonic Energy, Stellantis, and PowerCo.
The site will become the first such manufacturer in North America. In addition to the loan, the Department of Energy previously awarded Novonix a $100 million grant and $103 million investment tax credit.
The loan authorization was issued as the United States works to shift dependence for critical minerals from China. China controls the majority of the world’s mining and processing critical minerals, which are essential in both consumer products and military application.
The Chinese communist regime has a history of subsidizing and directing industries in order to price global competitors out of business. “The U.S. defense industrial base is not a large enough consumer of these materials to independently support a parallel, non [China] critical mineral supply,” the report said.
Some proposed legislation also aims to direct where companies can buy and sell critical minerals.
One bill proposes to update 2018 export restrictions on recycled battery and magnet materials, for example. Innovations in material recovery during the recycling process, and Chinese entities’ track record of using loopholes to obtain sanctioned materials require strong laws to limit foreign adversaries’ control over lithium, cobalt, nickel, and battery supply chains, according to the report.
