DOE provides conditional loan commitment of $850M to KORE Power for battery plant – Arizona. The U.S. Department of Energy’s (DOE) Loan Programs Office (LPO) today announced a conditional commitment for an $850 million loan to help finance the construction of KORE Power, Inc.’s advanced battery cell manufacturing facility in Buckeye, Arizona.
The facility, called “KOREPlex,” aims to strengthen the domestic battery supply chain by significantly increasing the nation’s battery cell manufacturing capacity for energy storage systems (ESS) and electric vehicles (EVs). The KOREPlex will produce an estimated 6 GWh of battery cell storage capacity annually, which could power more than 28,000 EVs annually and displace an estimated 11.8 million gallons of gasoline per year.
The project is expected to create up to 700 construction jobs and 1,250 operations jobs. As an investment in the next generation of clean energy workers, KORE will be collaborating with nearby colleges and tribes to train the local workforce for operations roles.
This latest project under LPO’s ATVM Program is essential to the Biden-Harris Administration’s strategy to onshore EV supply chains to ensure that half of all new vehicles sold domestically in 2030 are zero-emissions vehicles.
Electric vehicles, which represent a rapidly growing share of new vehicle sales, are powered by advanced batteries. ESS allow energy from intermittent renewable sources, like wind and solar, to be stored and dispatched as needed. Onshoring battery manufacturing is critical to reducing America’s reliance on other nations, such as China, which currently dominates the industry and supplies many American companies with materials to resell foreign-made batteries.
As the United States prioritizes electrification of the transportation sector and domestic demand for batteries increases exponentially, the KOREPlex facility will be well-positioned to manufacture batteries to meet the country’s diverse storage needs.
The 1,330,000-square foot KOREPlex building will house two production lines, which will manufacture batteries for EV and ESS. The KOREPlex plant will also produce two unique battery cell chemistries, including both nickel manganese cobalt chemistry, and lithium-iron phosphate, which does not utilize cobalt and may help reduce reliance on foreign supply chains use of that critical material.
Intellectual Property, manufacturing processes, and know-how will be onshored by KORE through the construction and operation of the KOREPlex. The project will support KORE’s ability to sell American-made batteries to a number of established offtakers. As part of its strategy, KORE will also target smaller automotive OEMs requiring lower production volumes and will aim to provide higher levels of service compared to other battery manufacturers.
The project aligns with the Biden-Harris Administration’s Justice40 Initiative, which set the goal that 40% of overall benefits of certain federal investments, including LPO financing, go to DOE-identified disadvantaged communities (DACs). Buckeye, Arizona, where the project is located, is a DAC, and KORE will be engaging with local community colleges and Tribal communities to hire and train the local workforce for facility operations jobs.
LPO catalyzes the U.S. battery supply chain through strategic financing, in line with the Biden-Harris Administration’s goal of strengthening the country’s clean energy supply chains. This is the seventh conditional commitment LPO has announced through the Advanced Technology Vehicles Manufacturing (ATVM) Loan Program within the past year. The program supports projects that can produce EVs, qualifying components, and materials that improve fuel economy.
For all projects DOE performs rigorous due diligence related to all aspects of a potential deal, including a borrower or sponsor’s potential nexus with foreign governments.
While this conditional commitment demonstrates the Department’s intent to finance the project, several steps remain for the project to reach critical milestones, and certain conditions must be satisfied before the Department issues a final loan.
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LPO Announces Conditional Commitment for Loan to KORE Power, Inc. to Increase Domestic Battery Manufacturing, June 9, 2023
