So too are other major mineral producers such as Australia, Chile, Mexico and Peru. The United States and Canada combined refine just 3.0% and 3.5% of the world's lithium and cobalt respectively and have even less battery cathode capacity.Ĭanada is an FTA partner. read moreīenchmark Mineral Intelligence estimates that China currently has 81% of the world's battery cathode manufacturing capacity, 75% of its cobalt refining capacity and 59% of its lithium processing capacity. MADE IN AMERICAĪuto-makers should "get aggressive and make sure that we're extracting in North America, we're processing in North America and we put a line on China," said Senator Joe Manchin, the architect of the minerals sourcing component of the EV subsidy scheme. The link between subsidy and mineral input is meant to accelerate the drive to build out domestic, or at least friendly, critical minerals capacity and break China's stranglehold. That percentage rises to 80% in 2026.Īuto-makers lobbied hard against the linkage, arguing that China is still too dominant and the United States too lagging in the battery metals supply chain for it to work.
#Ev battery cathode free#
The IRA extends and expands the existing electric vehicle (EV) subsidy of up to $7,500 but conditions the tax credit on the sourcing of the mineral content of the battery.Īt least 40% of the critical metals in the battery - lithium, nickel, cobalt and manganese - must come from the United States or a Free Trade Agreement (FTA) partner.
However, the green investment comes with a metallic sting in the tail. LONDON, Aug 16 (Reuters) - The Inflation Reduction Act (IRA) includes the "largest investment ever in combating the existential crisis of climate change", according to President Joe Biden, who will sign the bill into law later on Tuesday.Īround $369 billion of federal funds will flow into climate change and energy security, boosting domestic capacity to produce wind turbines, solar panels and electric vehicles.
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