US Department of Energy finalizes $2.5B loan for battery manufacturing facilities

WASHINGTON, Feb. 2, 2023 – The U.S. Department of Energy (DOE) Loan Programs Office’s (LPO) closing of a $2.5 billion loan to Ultium Cells LLC, a joint venture between General Motors and LG Energy Solutions, was assisted by JLL. The loan will help finance the construction of three new lithium-ion battery cell manufacturing facilities in Warren, Ohio; Spring Hill, Tennessee; and Lansing, Michigan.

JLL assisted the DOE, alongside Grant Thornton, in the credit risk evaluation of the project structure including the allocation of risk, the strength of construction, supply, and purchase contracts, and negotiated appropriate loan terms and conditions to mitigate risk.

The project is expected to create approximately more than 11,000 jobs across the three facilities and boost the nation’s standing as a global leader of electric vehicles (EV) manufacturing. In October, the Federal Government launched the American Battery Materials Initiative to grow the end-to-end battery supply chain alongside $2.8 billion in grants from DOE to build out the battery mineral and material supply chain. The three new facilities will manage battery cell production to respond to the growing U.S. consumer demand for EVs.

The loan will develop the facilities, which will manage battery cell production to help address the growing U.S. consumer demand for EVs and support the Biden administration’s goals to reach net zero emissions by 2050 and see EV's comprise half of all new vehicle sales by 2030.

The announcement marks LPO’s first closed loan exclusively for a battery cell manufacturing project under the Advanced Technology Vehicles Manufacturing (ATVM) program. For more information, visit the DOE’s announcement.

JLL recently discussed how EV sales in America jumped 66.4% in the past year, learn more here.

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