The company behind an advanced battery factory slated for Buckeye has received a conditional commitment for a federal loan of $850 million to build the facility.
The U.S. Department of Energy loan would finance KORE Power’s construction of a 1.33 million-square-foot facility to make batteries for electric cars and trucks and energy storage systems for various commercial users, from other manufacturers to power utilities. The batteries also could power a range of other vehicles from railroad locomotives to motorboats, as well as heavy construction equipment.
The factory near State Route 85 and Baseline Road is expected to employ 1,250 people when it’s operating at full capacity, along with 700 construction jobs. Production is slated to begin late next year or in early 2025 with capacity to produce battery cells with 6 gigawatt hours of energy storage annually — enough to propel 28,000 electric vehicles and replace 11.8 million gallons of gasoline. Production could expand to 12 GWh later.
The conditional commitment from the department’s Loan Programs Office means KORE will need to secure necessary permits, raise equity and meet various other requirements. The interest rate on the loan will reflect prevailing yields on Treasury bonds depending on the term of the loan, which wasn’t disclosed.
The project was announced in October 2021.
Focus on domestic production
The bipartisan infrastructure law enacted in late 2021 expanded loan authorizations for building advanced technology vehicles in this country.
“Onshoring battery manufacturing is critical to reducing America’s reliance on other nations, such as China, which currently dominates the industry and supplies many American companies with materials to resell foreign-made batteries,” the Loan Programs Office said in a statement.
The cells will feature nickel manganese cobalt and lithium-ion iron phosphate technology.
“We are focused on building a facility where American workers will build the battery cells that power our energy and mobility future,” said Lindsay Gorrill, founder and CEO of KORE, which is based in Coeur d’Alene, Idaho. “Domestic manufacturing will unlock the benefits of clean energy investments for U.S. workers across the supply chain.”
Opportunities for disadvantaged communities
Following Biden Administration directives, financing from the Loan Programs Office seeks to include disadvantaged communities such as Native American tribes and areas with high proportions of lower-income households, relatively few college graduates and so on. Buckeye is classified as a disadvantaged community. A White House goal seeks to direct 40% of the overall benefits from certain federal investments including this type of loan to disadvantaged communities.
Arizona Sens. Kyrsten Sinema and Mark Kelly both hailed the loan announcement.
The project “creates strong careers for everyday Arizonans, boosts national security by reducing reliance on foreign nations and strengthens America’s energy independence and leadership,” said Sinema, co-author and lead negotiator of the infrastructure law that expanded this type of financing, in a statement.
Supporting KORE Power’s Buckeye factory “will bring manufacturing back to America for a critical supply chain, while creating good-paying jobs,” Kelly said in a statement. Along with job growth, the project will “strengthen our national security by reducing our dependence on foreign sources of battery components.”
