Last week the Biden –Harris administration announced over $3 billion in federal grants to subsidize  domestic battery processing, manufacturing, and recycling projects.

“These investments are also going to help end America’s reliance on critical materials from our economic competitors like China,”  said Energy Secretary Jennifer Granholm.

Lael Brainard, director of the National Economic Council under the White House, said the investments would address the vulnerability of depending on China for critical minerals and battery supply chains.

China is a dominant player in the global lithium-ion market.

The country’s output was over 940 gigawatt-hours last year, at the same level of estimated global demand. Seventy percent, or $13.1 billion, of the U.S. lithium-ion battery imports in 2023 were directly from China. The percentage increased to over 80 for the first half of this year owing to the market’s anticipation of higher tariffs.

Last week, the Office of the United States Trade Representative finalized its tariffs on Chinese goods. Tariffs on Chinese lithium-ion electric vehicle batteries will increase from 7.5 to 25 percent on Sept. 27, and the lithium-ion non-electrical vehicle battery tariff rate hike to 25 percent will occur at the beginning of 2026.