Business & Finance
Energy Department awards $500 million to domestic battery startups amid pivot to defense demand
Federal grants aim to strengthen the domestic battery supply chain following the removal of electric vehicle incentives.
The short version
- The Department of Energy announced $500 million in grants to U.S. battery startups to bolster the domestic supply chain and support national security.
- Battery companies are increasingly seeking defense contracts after legislative changes eliminated incentives for electric vehicles and batteries.
- Key grant recipients include Lilac Solutions, Nth Cycle, and Coreshell for extraction, recycling, and component manufacturing.
- It remains uncertain whether defense sector demand can fully compensate for reduced momentum in the broader automotive battery market.
Key facts
- The Department of Energy awarded $500 million in grants intended to reduce reliance on foreign supply chains and enhance domestic battery manufacturing.[TechCrunch]
- Lilac Solutions received $100 million to construct a Utah facility aiming to produce 5,000 metric tons of lithium carbonate per year by 2028.[TechCrunch]
- Nth Cycle was awarded $100 million to build a refining site to process recycled battery black mass into lithium and nickel compounds.[TechCrunch]
- Coreshell obtained $50 million from the Department of Energy to scale up manufacturing of its silicon anode materials.[TechCrunch]
- The One Big Beautiful Bill removed federal electric vehicle and battery manufacturing incentives, leading startups to lean into military applications like drones and communications gear.[TechCrunch]
What remains uncertain
- The long-term ability of defense procurement to sustain startup revenue compared to the much larger automotive battery market remains unproven.[TechCrunch]