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Biden will invoke Defense Production Act for materials for electric vehicle batteries

Biden will invoke Defense Production Act for materials for electric vehicle batteries

President Biden is set to invoke the Defense Production Act (DPA) as early as this week to step up production of minerals used to manufacture electric vehicle batteries, a source familiar the plans confirmed to The Hill. 

Biden will issue a presidential determination to increase domestic production of the mineral, which is used in stationary batteries as well as vehicles. The person stressed that the production will not be done without a permit or through environmental review. 

The addition of certain minerals, including lithium, cobalt, graphite, nickel and manganese, to the list of items covered under the law could give mining companies access to some $750 million under the DPAs Title III fund, the person told The Hill.  

The DPA was originally passed during the Korean War to increase aluminum and titanium production. It gives the president the authority to order increased domestic production. It was invoked by former President Trump during the COVID-19 pandemic of meat production. Biden used it shortly thereafter to increase production of pandemic-related supplies. 

The Hill was told by a source familiar that the White House would implement the order in collaboration and with the Energy and Interior departments. The law will not be used for loans or direct purchase, but for funding for feasibility studies, coproduct and byproduct production at current operations, as well as productivity/safety improvements. 

Environmental groups are urging the Biden administration, in light of rising gas prices due to the Ukraine conflict to invoke the DPA for assistance in developing alternative fuels.

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The idea was also supported by members of Congress who are bipartisan. Sens. Joe Manchin (D.W.Va.), Lisa Murkowski, James Risch (R.Idaho), and Bill Cassidy(R.La.) called on Biden for the DPA to be invoked for battery materials. 

They specifically mentioned the near-monopoly Chinese companies’ hold on the production of the materials in question. They wrote, Allowing our foreign minerals dependence to persist is an increasing threat to U.S. security and we must take every step necessary to address it. 

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