U.S. Energy Department Finalizes $9.63 Billion Loan to BlueOval SK for EV Battery Plants

The U.S. Energy Department on Dec. 16 announced the closing of a $9.63 billion direct loan to Blue Oval SK to build three electric vehicle battery manufacturing facilities: one in Tennessee and two in Kentucky. This marks the largest loan granted by the department’s Advanced Technology Vehicles Manufacturing, or ATVM, program. The plants would have an annual EV battery production capacity of over 120 gigawatt-hours, potentially displacing an estimated 455 million gallons of gasoline per year during the vehicle’s operating life.

BOSK is a joint business between Korean EV battery manufacturer SK On and Ford Motor Company. The facilities will supply EV batteries for Ford Motor Company’s future Ford and Lincoln electric vehicles. The department first announced the conditional loan guarantee to BOSK in June 2023.

Expanding domestic EV Battery manufacturing is a key priority for the department, to ensure that the U.S. can meet the soaring demand for EVs in the next decade. In recent months, the department announced conditional loan guarantees totaling almost $15 billion to boost EV battery manufacturing in the U.S., through its ATVM program. In early December, the department announced a conditional commitment for a loan of up to $7.54 billion for StarPlus Energy to build two lithium-ion electric vehicle battery manufacturing facilities in Kokomo, Indiana. In November, the department announced a conditional loan guarantee of $6.6 billion to Rivian New Horizon to build an EV manufacturing site in Stanton Springs North, Georgia.

To further bolster EV battery manufacturing, the department has announced a conditional loan guarantee of $754.8 million to NOVONIX to construct a synthetic graphite manufacturing facility in Chattanooga, Tennessee for EV lithium-ion batteries. Synthetic graphite is a key material used in EV battery anodes. As synthetic graphite can be produced at a higher purity than natural graphite, it can lead to better battery performance and durability. Once operational, the facility is expected to have an annual production capacity of 31,500 metric tonnes of synthetic graphite for the batteries of 325,000 EVs per year.