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The Department of Energy will provide $2.5 billion in loans to GM and LG to build battery factories.

The US Department of Energy said on Monday it would lend $2.5 billion to the battery maker, owned by General Motors and LG Energy Solutions, to build battery factories, to boost electric vehicles and reduce dependence on China for critical components. for the Biden administration’s plan to be carried forward.

GM and LG Energy, a South Korean battery maker, are partners in Altium, a joint venture that will use the money to manufacture batteries in Ohio, Tennessee and Michigan. The loan, which is conditional on the companies meeting certain requirements, is the first in more than a decade by a government program that provided $465 million to help Tesla produce its first sedan, the Model S.

The US government has played an important and often unheard of role in promoting electric vehicle technology. Several universities and entrepreneurs have received funding from the Department of Energy’s Advanced Research Projects Agency to develop batteries that can be charged faster and contain more energy per pound than earlier versions. Some of these companies, such as Silla Nanotechnologies in Alameda, Calif., and Solid Power in Louisville, Colo., are moving closer to making advanced batteries for major car manufacturers.

The Energy Department said the new Altium factories are expected to provide more than 5,000 permanent jobs. GM has said that the Ohio factory, which is in Lordstown, will begin producing battery packs this year.

Domestic battery manufacturing can also help reduce the cost of electric vehicles. Batteries are heavy, and making them near car factories usually saves money.

Investments in Ohio and Michigan will help reassure labor leaders and state officials that they will not be left out of the electric vehicle boom. Most of the corporate investment in new electric car and battery factories is going to southern states such as Tennessee, Alabama and Georgia.

“We should take this opportunity to build advanced batteries – the heart of this growing industry – right here at home,” Michigan Energy Secretary and former governor Jennifer M. Granholm said in a statement.

Separately, in a rare display of bipartisanship, Congress last year passed an infrastructure law that the Biden administration hopes will prepare the ground for millions of electric cars, and establish a domestic supply chain for battery manufacturing. Will do

The administration plans to spend $7.5 billion on major highways to build electric vehicle chargers and more than $7 billion to set up supplies of lithium and other materials used to make batteries. Lithium processing is dominated by China, and CATL, based in Ningde city, is the world’s largest battery manufacturer.

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