Governor Declares Kentucky the “Capital of EV Battery Production” in the United States

Governor Declares Kentucky the “Capital of EV Battery Production” in the United States

Governor Declares Kentucky the “Capital of EV Battery Production” in the United States

With billions at stake, US states are scrambling to attract companies specializing in electric vehicles and batteries. Panasonic recently opened a $4 billion battery plant in Kansas, while a joint venture between GM and LG Energy Solution is building lithium-ion battery cell manufacturing facilities in Ohio, Tennessee and Michigan.

But it was Kentucky that declared itself “the electric vehicle battery production capital” of the United States.

In his annual State of the State Address(Opens in a new window), Governor Andy Beshear, a Democrat, highlighted three major investments in battery facilities in 2022, a $9 billion investment that will create about 7,400 jobs. “Much of our economic history — and much of our future economy — is tied to our electric vehicle revolution,” Beshear said. These projects include:

  • Envision AESC Battery Factory: $2 billion project, 2,000 new jobs in Warren County, KY

  • Ford + BlueOval SK Battery Factory: $6 billion project, 5,000 new jobs in Glendale, KY

  • Recycling Ascend Elements Batteries: $1 billion project, 400 new jobs in Hopkinsville, KY.

The Envision AESC plant is the second-largest project in state history, Beshear said, and Ascend elements(Opens in a new window) the recycling plant is “the biggest investment Western Kentucky has ever seen”. BlueOval SK says(Opens in a new window) its factories are the size of 60 football fields, which will pump out electric vehicle batteries for Ford and Lincoln vehicles.

The manufacturing plants of Envision AESC and Ford/BlueOval SK will likely work with recycler Ascend Elements, whose main business is recovering waste from the battery manufacturing process for brands like Honda, Jaguar and Land Rover. It repackages waste to create more batteries without importing new materials, which usually come from China.

KY Gov Beshear and Mike Kronley

Governor Beshear shakes hands with Ascend Elements CEO Mike O’Kronley. (Ascend Elements)

Governor Beshear and Ascend Elements open a new battery recycling facility in Kentucky.

Governor Beshear and Ascend Elements open a battery recycling facility in Kentucky. (Credit: Ascend Elements)

“It’s like when you make cookies, there’s dough left on the outside of the cookie cutter that you can’t use,” Mike O’Kronley, CEO of Ascend Elements, told PCMag. They expect the Kentucky facility to recover enough material for 250,000 electric vehicles per year.

“Almost all [lithium] is only refined in China,” says O’Kronley. “You don’t have the same situation with aluminum and steel, which have factories all over the world and are heavily recycled. Most new cars have recycled steel or aluminum, but these are much more mature industries compared to the lithium-ion battery industry. It will change over time and get better.”

Ford BlueOval SK Battery Plant in Kentucky

Rendering of Ford and BlueOval SK’s new battery plant in Kentucky. (Credit: Ford)

Governor Beshear referenced America’s near total dependence on China in his speech. “Through this project, we won’t have to depend on China for a single ounce of lithium,” he said. “We protect our national security and we do it right here in Kentucky.”

That said, the big bets on Kentucky batteries aren’t all-American. Chinese-owned Envision AESC and Ford partner SK On(Opens in a new window) is based in South Korea.

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The Battery Belt Against China

President Biden has encouraged the manufacture of batteries and their metals (primarily lithium, cobalt, manganese, and nickel) in the United States. It has released $2.8 billion in funding for new projects, which has been awarded to a wide range of companies: manufacturers, recyclers and those researching new battery technologies. Ascension Items Received(Opens in a new window) $480 million in grants, for example, and Washington state-based Group14, which makes energy-dense silicon-ion batteries that can replace lithium-ion batteries, received(Opens in a new window) $100 million.

For electric vehicle owners to receive the full $7,500 federal tax credit, a certain percentage of their vehicle’s battery must be made in the United States with US-sourced metals, as required. the Inflation Reduction Act passed last year.

As a result, automakers are rapidly setting up American factories to build electric vehicles as well as new battery facilities like we see in Kentucky. A rapidly forming “battery belt” has emerged, primarily in the Midwestern and Southern United States, although the construction of facilities will take a few years. Kentucky, Georgia and Michigan will be the nation’s largest battery producers by 2030, according to a recent report(Opens in a new window) of the US Department of Energy.

Battery Belt

Michigan, Georgia and Kentucky will produce the largest battery capacity of any US state, between 97 and 163 GWh/year. (Credit: US Department of Energy)

Some consumers and automakers question whether the strict, nationally-first policy is feasible given the current reliance on China for materials. Foreign automakers like VinFast aren’t big fans either, as they may now find it difficult to sell in the United States as their vehicles won’t be eligible for the tax credit. For now, however, governors like Beshear are happy to tout the economic benefits and job opportunities these investments bring to their states.

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