Battery materials and technology company NOVONIX has secured a $100 million grant from the US Department of Energy (DOE) to enhance the domestic production of high-performance, synthetic graphite anode materials.
This grant, facilitated through the Bipartisan Infrastructure Law (BIL), aims to bolster North America’s battery supply chain in response to surging demand and the growing imperative to onshore these vital industries, the company said in an ASX announcement.
Initially, NOVONIX was selected for negotiations regarding a $150 million grant intended to support the construction of a new synthetic graphite manufacturing facility, with an initial output goal of 30,000 tonnes per annum (tpa).
Following discussions with the DOE, NOVONIX restructured the funding to more immediately boost its Riverside facility in Chattanooga, Tennessee, which is targeted to produce up to 20,000 tpa.
Consequently, the grant award was adjusted to $100 million. This grant will support the procurement and setup of equipment to achieve the 20,000 tpa production capacity at the Riverside site.
As a stipulation of the grant, government funds must be matched by NOVONIX. The company anticipates that in addition to the $100 million DOE grant, its existing cash resources, customer revenues, other government programs, strategic partnerships, and various capital sources will collectively fund its expansion plans.
Dr Chris Burns, CEO of NOVONIX, expressed his excitement about completing the award negotiation with the DOE and expanding Riverside’s production capacity.
“The ability to deploy $100 million towards Riverside’s recently increased production targets will have an immediate beneficial impact on the Company’s plans and the battery materials supply chain here in North America,” Dr Burns noted.
He also underscored the importance of building a domestic supply chain for critical materials, especially in light of recent Chinese export controls on graphite.
Under NOVONIX’s plans, the Riverside facility is expected to commence production in late 2024 to support the company’s supply agreement with KORE Power.
Updates on progress will be provided in the first quarter of 2024. NOVONIX is also actively engaging with potential customers to discuss product qualification, production timelines, and potential supply agreements that could be facilitated by Riverside or future production facilities.
Moreover, the company is advancing its plans for a new production facility with an initial production target of at least 30,000 tpa.
The engineering and design of this facility will draw from the insights gained during the engineering process specific to Riverside, set to be finalized in the first quarter of the coming year.
NOVONIX’s application for funding support under the DOE Loan Programs Office’s Advanced Technology Vehicles Manufacturing (ATVM) Program has been invited to the Due Diligence phase (“Phase 3”).
A loan under the ATVM program could provide leverage for up to 80 per cent of eligible project costs for NOVONIX’s next facility.
The timing of this new facility and subsequent plans to achieve a production capacity of 150,000 tpa in North America will be contingent on the timelines of potential customer demand.
