“Before the Inflation Reduction Act, the U.S.
The key is the production credits baked into the Inflation Reduction Act - $45 per kilowatt-hour for battery packs made in the US, $35 per kWh for the battery cells, and $10 per kWh for battery modules. Last month, it said it would build at least two additional factories in North America by 2030. The Japanese company is planning a $4 billion battery factory in Kansas. In fact, Panasonic is pretty much the only other game in town. So if the US wants batteries right now (it does), and if it wants to avoid Chinese battery giants (it really does), it has few options other than purchasing from South Korean firms.
That’s because South Korea is one of only three countries with mature battery manufacturing sectors, China and Japan being the others. Companies based in South Korea have announced more than $30 billion in US clean energy projects since last August, topping the US company total of around $26 billion.Īlthough several key solar and EV announcements have come from South Korean firms, the country’s impact is felt most when it comes to batteries. US-based companies account for less than half of the clean energy manufacturing announcements made since the passage of the Inflation Reduction Act, and just about one-third of the promised investment dollars. In fact, it’s not currently possible for the US to meet its lofty “made in America” goals without relying heavily on clean energy tech and investment from firms based outside of the country, Canary Media reports. Impressive as this explosion in clean energy manufacturing may be, it’s not happening without some serious help from abroad. Another 11 clean energy manufacturing projects that account for more than $7.5 billion in investment have been announced but don’t have a location. The planned factories are concentrated in Alabama, Georgia, and South Carolina, with some also coming to Ohio and solar giant Texas. There’s more than a little fine irony there.īattery manufacturing will see an upsurge in those mostly southern states and solar manufacturing is headed to the South as well. Almost all of them are so-called red states whose Congressional representatives vigorously opposed the Inflation Reduction Act. Almost all of this new economic activity is located in states that are east of the Mississippi River. The Inflation Reduction Act & The Rust BeltĬompanies have so far gravitated toward a handful of states to build their production facilities - many of them states once lumped into the Rust Belt category.
Nearly 100 new clean energy manufacturing facilities or factory expansions totaling almost $80 billion in new investment have been announced in the America since the Inflation Reduction Act was passed and signed into law last August. “The United States is effectively now the most attractive destination for global capital in clean energy and cleantech.” “What has taken place as a result of and since the Inflation Reduction Act can simply not be overstated,” said Aaron Brickman, a senior member of the clean energy team at RMI (formerly known at the Rocky Mountain Institute). It has spurred tens of billions of dollars in private investment from both domestic and foreign firms hoping to capitalize on the clean energy boom. Thanks to some actual leadership by President Biden and Democrats in Congress, manufacturing in America is roaring back.Īccording to Canary Media, in just the first 9 months after its passage, the Inflation Reduction Act (which has virtually nothing to do with inflation) has shifted the economic viability of building clean energy equipment in the US. They refer to America’s industrial heartland as the “Rust Belt.” The Inflation Reduction Act has changed all that. They are used to seeing the smokestacks in Youngstown, Pittsburgh, and other industrial cities highlighted silently against the sky. For decades, people have been wringing their hands and bemoaning the fate of America’s once great industrial empire.
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