The Biden administration has unveiled a new initiative to support the transition to clean energy, offering $12 billion in grants and loans for automakers and suppliers to retrofit their facilities to make electric and hybrid vehicles.
Energy Secretary Jennifer Granholm made the announcement on Thursday, emphasizing the administration’s commitment to ensuring a smooth shift to EVs without leaving workers or communities behind.
By expediting grants and subsidies for the conversion of existing auto plants to produce electric vehicles, the White House aims to address concerns from automakers and the United Auto Workers (UAW) union about proposed environmental regulations geared toward advancing the EV era.
The UAW has raised alarms over potential job losses, particularly in states like Michigan, Ohio, Illinois, and Indiana.
The UAW’s president, Shawn Fain, expressed enthusiasm for the policy, noting that it “makes clear to employers that the EV transition must include strong union partnerships with the high pay and safety standards that generations of UAW members have fought for and won.”
President Joe Biden echoed this sentiment, highlighting the opportunity for collaboration between auto companies and unionized workers to build a clean energy economy.
The initiative includes $2 billion in grants from the Inflation Reduction Act and $10 billion in loans from the Energy Department’s Loans Program Office.
$3.5 billion in funding will be extended to domestic battery manufacturers. Although there are no specific labor requirements, projects with better labor conditions are more likely to secure funding. This initiative also offers a chance to potentially save auto manufacturing plants and support communities, including the Jeep factory in Belvidere, Illinois.
According to the Department of Energy, the funding can be used for factories that manufacture EVs, efficient hybrid, plug-in electric hybrid, plug-in electric drive, and hydrogen fuel cell vehicles.
Information for this story was found via Reuters, Bloomberg, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
