US president Joe Biden will invoke Korean war-era powers to boost the domestic supply of minerals crucial for electric vehicles and large capacity batteries, as his administration tries to reduce its dependence on overseas energy.
Biden will use a presidential determination as soon as this week to invoke the Defense Production Act to help increase the availability of lithium, nickel, cobalt, graphite and manganese in the US.
Under the terms of the DPA, an administration can compel companies to prioritise government contracts over private ones, for instance, or to provide loans and grants to boost manufacturing.
A person familiar with the White House’s plans said the administration was not contemplating making direct purchases of the minerals, but would aim to make government funding available for mining feasibility studies and safety upgrades, as well as producing minerals from existing mining waste.
The person said triggering the DPA would not allow mining companies to bypass or expedite any permitting or environmental review processes.
Currently, the US imports the vast majority of the minerals the White House intends to add to the list of items covered by the DPA.
Biden ordered a review of critical supply chains early last year as he sought to reduce US dependence on China for a range of imports deemed important to national security, including minerals, pharmaceuticals and computer chips.
The US Department of Energy last year released a blueprint specifically aimed at reviving the US’s domestic battery supply chain, and forecast that a boom in electric vehicles would lead to a surge in demand for batteries over the next decade.
It proposed securing US access to the raw minerals needed to make batteries by providing incentives for “safe, equitable and sustainable” domestic mining, and devoting money to researching ways to capture minerals through recycling waste or expired batteries.
In its paper, the DoE noted that China dominates the supply chain for the manufacturing of lithium batteries, including the processing of minerals.
Last month, the DoE said it would make nearly $3bn available to companies in the US battery manufacturing supply chain to help scale up production.
Biden’s infrastructure bill, which passed through Congress last year, also made $7bn available over five years for the processing of minerals and for recycling end-of-life batteries.
The DPA was invoked by former president Donald Trump to boost the production of coronavirus-related medical supplies during the height of the pandemic.
