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Biden should tap US DOE program to jump-start EV supply chain – analyst

The incoming administration of President-elect Joe Biden should take full advantage of a Trump administration move to free up clean energy dollars for battery metals supply-chain infrastructure, Benchmark Mineral Intelligence Managing Director Simon Moores told S&P Global Market Intelligence in a Jan. 14 interview.

Observers like Moores have contended that as U.S. competitiveness within the global battery manufacturing arena lagged, such delays would hold back the country's ability to deploy electric vehicles at the massive scale needed to curb carbon emissions and combat global warming.

But days after Biden won the 2020 presidential election, President Donald Trump's administration handed the former vice president a potentially pivotal tool: increased access for mining and mineral refining projects to receive loans under U.S. Energy Department clean energy programs.

When the Trump administration made this decision, an unnamed senior Energy Department official told reporters the department anticipated the Biden team would not reverse the decision. Moores agreed, saying Trump actually gave Biden a powerful tool for establishing a U.S. battery supply chain and combating climate change.

"[There's a] pot of DOE loan money that is instant and available that Biden can tap into straight away to get the supply chain up and running," Moores said.

Moores said he views the future of battery metals under Biden "very positively" compared to his predecessor. Though Trump raised awareness of the criticality of minerals supplies, the agenda appeared disorganized at times.

"It wasn't negative under Trump. It was just erratic ... The conversation in Washington, D.C., whether that's policymakers, the guys that make the rules of legislation, of industry... [They] were all talking cross-purpose," Moores said. "There wasn't enough communication. There wasn't a coherent story."

Under Biden, Moores expects the story of critical minerals will be "turbo-charged" as part of his goal for a "green recovery" from the coronavirus pandemic and its economic impacts.

"What we expect from the Biden administration is to simply make one of their policies to make gigafactories across the whole country at scale in order to turbo-charge and protect their biggest automobile companies" such as Ford Motor Co. and General Motors Co., Moores said. "Biden should be encouraging cheap loans or free land for battery companies in Asia to build component manufacturing in the U.S., giving good deals."

The primary headwind to a U.S. battery supply chain remains its government permitting programs. Biden will need to manage a divide within the Democratic Party between proponents of expanded minerals supplies and those that are concerned about the negative environmental and societal effects of mining, including its potential intersection with tribal rights.

"The argument the liberal side would say on that is, you can recycle these things. But you're not going to get the raw materials you need from recycling batteries. ... That is a cultural issue that will slow building domestic EVs in the U.S.," Moores said.