Federal Grants Help Ease Lithium Supply Bottleneck

An expanded lithium plant has officially opened in North Carolina, and that could spell good news for the U.S. lithium-ion battery market, which has been plagued by concerns over prices and supply. More specifically, the new  Kings Mountain lithium facility provides a boost to President Obama's goal of transitioning the U.S. to electric vehicles, a goal that depends on lowering the cost of rechargeable batteries. The new plant is owned by Rockwood Lithium (formerly Chemetall), and it illustrates the President's "all-of-the-above" strategy for ensuring the future of the U.S. energy supply through federal investments. It received $28.4 million in Recovery Act funding through the Department of Energy, which enabled Rockwood to raise an additional $46 million from the private sector. Part of the funds will also go to expand Rockwood's lithium operations in Nevada. Nerves fray over lithium supply Though the known lithium reserves  worldwide appear sufficient to meet long-term global demand for rechargeable batteries, that has little bearing on short-term supply issues. Bloomberg News has noted that the lithium supply issue has been heating up, with skyrocketing demand for iPads and other mobile devices leading to a recent tripling of prices. If that trend continues into the foreseeable future, it could put a real kink in the President's efforts to revive domestic manufacturing across the spectrum of battery-operated products, especially when it comes to electric vehicles like the Chevy Volt. It would also affect the President's efforts to transition the U.S. electrical grid to renewable energy and "smart" technologies, which depend heavily on an increased use of energy storage. Even if the global supply of lithium was more expansive, the lack of a sufficient domestic supply exposes the U.S. to the same geopolitical issues that have bedeviled the petroleum markets for generations. It's a situation that has mirrored the solar power market, which the U.S. once led by a wide margin. According to DOE, the U.S. had the edge in lithium production until the early 1990s but currently imports most of its needs. New batteries, green jobs Although the Rockwood projects create only about 100 jobs, they are part of a broader strategy that supports thousands more. Back in 2009, the Department of Energy announced $2.4 billion in Recovery Act funding for a web of advanced battery and EV projects in the U.S. All together, the Administration anticipates that the new facilities will be capable of supplying rechargeable batteries and other components for more than 500,000 electric vehicles annually. The end goal, called the EV-Everywhere Challenge, is to lower the cost of electric vehicles, down to the point where they represent a more affordable and convenient choice over gasoline-powered vehicles. Image: Some rights reserved by Argonne National Laboratory. Follow me on Twitter: @TinaMCasey. Image: