After Biden’s administration set new tariffs on EV and non-EV batteries, most experts did not pay much attention to this vital matter.
We don’t mean you should start buying batteries like people did with toilet paper during the COVID. This article will give you sad facts with optimistic forecasts so you can make rational decisions for your good.
Lithium is the key component of the batteries used in the US consumer market. Phones, laptops, toys, EVs. It’s a long list of goods that need lithium for the batteries, including American military and security forces.
The agenda of the World Economic Forum in 2023 stated this: the United States imports hundreds of millions of lithium-ion batteries each year. The statistics indicated that China accounted for most U.S. battery imports in 2022, with a total trade value of $9.3 billion. South Korea and Japan are popular sources, with batteries worth $1.3 and $1.0 billion imported to the U.S. in 2022.” The total import value of lithium-ion batteries has nearly tripled since 2020, reaching $13.9 billion in 2022.
Most consumers use energy storage devices (from phones to EVs) with lithium, which is not mined and processed in America. Here is another sad data with citations from global research by The Center on Global Energy Policy (CGEP):
Next, you must know that before lithium becomes a part of the battery, it must be processed along with other chemicals. And here we go again:
Here are all the figures mentioned above in dollars: the import value of Chinese non-EV-used lithium-ion batteries was US$2.3 billion in 2023, a 34% increase from 2022.
All of the above means one simple fact: America does not produce enough much-needed energy storage devices. We depend on foreign non-ally countries, and billions of dollars go overseas instead of being spent here on wages and local profits. That is also a question of national energy security.
Yes. At the end of 2022, the US Department of Energy reported $2.8 billion in funding for the “projects will support new and expanded commercial-scale domestic facilities to process lithium, graphite and other battery materials, manufacture components, and demonstrate new approaches, including manufacturing components from recycled materials.” In other words, that is a federal budget spending on the research and development of domestic full-scale battery manufacturing. There are about 20 projects, like the relaunching of the lithium mines in Kings Mountain, North Carolina, and the construction of the new lithium processing plant (its volume will be enough for more than one mln. electric vehicles) in the same area. Or the construction of the battery minerals refinery in Mercer County, North Dakota, which will support the domestic cathode supply chain.
All these projects (and other federal incentives and plans) will be fulfilled and launched between 2026 and 2028. Starting in 2030, America will supply itself with enough batteries through its domestic mining-processing-producing chain. Ally countries and commonwealths like South Korea or the European Union can provide the shortage.
At the same time, the good news will come in four years. The battery tariffs will come into effect in 2026. And yes, the prices in the US for energy storage equipment will go up before 2026 and, after that, until 2030.
That price increase won’t affect you much when we talk about small-scale batteries for phones, notebooks, or other gadgets. At the same time, prices for utility power storage equipment will go up before the market is supplied with American-made batteries.
So, what is your plan? Here are a couple of scenarios for you.
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Consider this additional cost of power storage as an investment to save money in the long run. Here are some ideas on what to do with saved money. Hint: start earning from solar energy.
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