Sharp policy swings are forcing companies to adapt strategies as the U.S. seeks domestic strength in an increasingly vital industry
Key Takeaways: Policy whiplash on a national priority
Shifting U.S. policies for the battery industry are fueling uncertainty just as business and political leaders in both parties have awakened to the strategic need to reduce dependence on China.
The Trump administration has kept some support measures for battery companies and added some others but also gutted incentives for EVs and renewable energy that make up a big source of demand. That has crimped a wave of new investment.
Battery companies also are grappling with much stricter regulations on their dealings with China, forcing them to rethink contracts or face losing access to tax incentives.
There also are growing opportunities for producers of batteries and battery minerals to address national security concerns about maintaining a domestic supply chain for the military.
From Biden boom to Trump slump
“People are not going to put an industry in the United States unless there’s a robust demand in the United States for that industry — period,” said Jason Burwen, vice president of policy and strategy at GridStor, which makes battery-based energy storage facilities for electrical grids.
From excitement to uncertainty
Burwen, the GridStor executive, said demand for grid-based battery storage will keep growing. But he said the complex rules around involvement of Chinese companies risk negating the value of the remaining tax credits — and undermining the goal of bolstering the domestic supply chain.
“One of the potentially unintended consequences here is if these restrictions become so onerous that no one can really take advantage of them, it doesn’t necessarily mean folks are going to invest in American supply chains,” he said. “It just means they’re going to accept that they’re not ever going to be able to access the tax credits.”
Read the full article here.
