As part of the Biden-Harris Administration's Investing in America agenda, the U.S. Department of Energy today announced a $1.3 billion direct loan ($1.2 billion of principal and $139.3 million of capitalized interest) to ENTEK Lithium Separators LLC (ENTEK). The loan will substantially finance a new facility in Terre Haute, Indiana to manufacture lithium-ion battery separators. The separators will be used primarily in electric vehicles (EVs) -- strengthening the U.S. lithium-ion battery cells supply chain and enabling the creation of batteries used in advanced technology vehicles. This project supports the nation's expansion of secure reliable, environmentally sustainable clean energy domestic supply chains key to reaching the country's ambitious climate goals while reducing reliance on economic competitors like China.
Today's announcement reinforces President Biden's Investing in America agenda to create good-paying, high-quality jobs in communities across the country and ensure workers benefit from America's growing clean energy economy. The project is expected to create 763 construction jobs and 635 operational jobs -- boosting the regional economy and adding to the 16 million jobs created since President Biden and Vice President Harris took office.
DOE's Loan Program Office (LPO) works with all borrowers to develop and implement a strong Community Benefits Plan (CBP) that ensures borrowers meaningfully engage with community, environmental, and labor groups to create good-paying jobs, improve the well-being of residents and workers, and minimize and mitigate any environmental impacts. One aspect of ENTEK's CBP is its commitment to creating opportunities for local labor, prioritizing hiring local workers who have been displaced from manufacturing industries. To recruit workers, ENTEK has forged partnerships with various institutions, such as Ivy Tech Community College, Indiana State University, and various community-based organizations. ENTEK is partnering with Ivy Tech to provide access to specialized training and apprenticeship programs, creating recruitment opportunities for disadvantaged communities. ENTEK has also been working very closely with local building and trades unions.
The project site is expected to benefit disadvantaged communities in line with the Biden-Harris Administration's Justice40 Initiative, which set a goal that 40 percent of the overall benefits of certain federal investments flow to disadvantaged communities that are marginalized by underinvestment and overburdened by pollution.
A battery separator is a membrane sandwiched between the anode and cathode of a battery. The principal functions of the battery separator are to prevent electronic conduction (i.e., shorts or direct contact) between the anode and cathode while permitting ionic conduction via the electrolyte. Separators play an essential role in the performance and safety of lithium-ion batteries.
DOE estimates that by 2030, the North American lithium-ion EV battery industry will require annual separator production of 7 to 10 billion square meters. Once complete, the ENTEK facility is expected to have the capacity to manufacture 1.72 billion square meters of separator material annually for the North American EV market. Each GWh of cell manufacturing requires 7-10 million square meters of battery separator depending on the battery form factor (cylindrical, pouch, or prismatic). Based on the LPO technical team's analysis using current form factors chosen by cell manufacturers, this project will support roughly 1.9 million mid-size EVs or 1.3 million eSUVs.
The project will make a significant contribution to growth in domestic battery separator capacity and help U.S. EV manufacturers satisfy battery component sourcing requirements under the 30D Clean Vehicle Credit. ENTEK will be able to customize battery separators to accommodate numerous EV battery designs. The separators produced will be able to accommodate all existing lithium-ion EV battery chemistries, including NMC, NCA, LMFP, and LFP. Additionally, ENTEK will be able to sell its separators to manufacturers of lithium-ion batteries for energy storage applications.
This project reinforces President Biden's efforts to onshore and re-shore domestic manufacturing technologies.
Domestic EV manufacturing has surged in response to the massive growth in the domestic and global EV markets and the financial incentives recently made available under President Biden's Inflation Reduction Actand Bipartisan Infrastructure Law. ENTEK aims to become the United States' first end-to-end, domestic supplier of "wet process" battery separators for the North American lithium-ion EV battery market.
The loan is offered through the Advanced Technology Vehicles Manufacturing (ATVM) Loan Program, which provides loans to support U.S. manufacturing of advanced technology vehicles, qualifying components, and materials that improve fuel economy. With several recent ATVM projects in the last year, LPO is helping support the Biden-Harris Administration's EV adoption goals.
Across all LPO's new and improved programs, DOE has attracted 210 active applications for projects across the country totaling over $303.5 billion in requested loans and loan guarantees, as of the end of October. For more information about ENTEK and its plans to expand U.S. battery separator manufacturing, read the conditional commitment blog post and visit LPO's portfolio project page.