DOE Selects Seven Projects for Up to $500M to Rebuild US Battery Supply Chains
August 24, 2026
The U.S. Department of Energy (DOE) selected seven projects on August 20, 2026, for award negotiations covering up to $500 million in battery supply chain funding to rebuild production inside the United States.
The decision comes after federal policy changes ended key electric vehicle (EV) tax credits and altered incentives for battery manufacturing, changes that TechCrunch says undercut a chunk of expected future demand.
The money targets the upstream and midstream of the battery supply chain: mineral refining, electrolyte chemicals, electrode and cell manufacturing, and recycling.
Where the $500 Million Would Go
DOE’s Office of Critical Minerals and Energy Innovation (CMEI) listed federal shares of $100 million for three projects and $50 million for four others. The selections are not final awards: Nth Cycle says in its own announcement that it will enter award negotiations with DOE, that selection is not a funding commitment, and that the final amount may change.
The three $100 million selections all involve processing and refining lithium, cobalt, and black mass. Waterleaf P1 HoldCo, a Lilac Solutions company, will build a commercial lithium extraction and refining facility on the northeastern shore of Utah’s Great Salt Lake at West Promontory. DOE says processed brine returns to the lake with no net water loss, and that phase one aims to double current U.S. lithium production.
Formation Holdings US, trading as Jervois, will build a commercial cobalt refinery for battery-grade cobalt sulfate at a site not yet named. Nth Cycle will refine black mass from end-of-life lithium-ion batteries into high-purity metals and battery-grade materials in the southeastern United States.
The four $50 million selections cover manufacturing and recycling. Princeton NuEnergy will build a demonstration plant in Commerce, Georgia, rejuvenating nickel-bearing cathode material from manufacturing scrap with a low-temperature plasma process. Arcanum Ventures will produce battery-grade ethylene carbonate, a key electrolyte ingredient, on the U.S. Gulf Coast. Elevated Materials will make ultra-thin lithium-metal films and prelithiated materials, and Coreshell Technologies will build silicon-anode electrodes and cells in San Leandro, California.
The Money Comes From a 2021 Infrastructure Law. What Changed Is the Message Up Front
This is not new money. DOE materials show the funding flows from the Infrastructure Investment and Jobs Act (IIJA), sections 40207(b) and (c), through the Battery Materials Processing and the Battery Manufacturing and Recycling grant programs. This is the third round of funding under the two programs, following a notice of intent in August 2025.
What changed is the message up front. DOE presents the selections as a way to cut reliance on foreign sources, bolster national security, and advance American energy dominance. Secretary of Energy Chris Wright said the country has “depended on foreign actors for critical materials essential to modern life.” On the Nth Cycle project, DOE states plainly that it reduces U.S. reliance on China and other foreign sources. Strengthening national security by reducing reliance on foreign competitors has been written into the 2021 law’s stated purposes from the start; the first round in 2022, under the previous administration, led instead with EV adoption goals, a net-zero economy, and boosting American production of clean energy technology.
Graphite, Cobalt, and Electrolyte: Territory Japan’s Materials Industry Knows
DOE says Coreshell will replace imported graphite with domestically sourced metallurgical silicon and create the first U.S. gigafactory dedicated to silicon-anode production. Arcanum’s ethylene carbonate is a core electrolyte input, and Jervois’s cobalt sulfate feeds cathode material. Public funding is now pushing these upstream supply-chain capabilities onto U.S. soil.
Defense is emerging as another source of demand. TechCrunch reports that a Coreshell spokesperson said defense applications are coming up in discussions, and that the company added ADS Ventures, whose parent ADS is a defense supplier, as an investor. Nth Cycle CEO Megan O’Connor told TechCrunch the company sees clear demand drivers from defense while automotive demand persists.
The figures TechCrunch cites point to a much larger automotive market, though they are not directly comparable: U.S. Defense Logistics Agency battery purchases stood at $200 million a year as of 2021, against an expected $18 billion in U.S. automotive battery manufacturing spending in 2026, per Mordor Intelligence. Investment outside EVs continues as well, with home storage company Base Power raising $1 billion.
What to Watch Next
Three of the selected projects, from Jervois, Arcanum Ventures, and Elevated Materials, have no announced site. DOE materials list the location as to be determined.
The battery supply chain funding is at the selection stage, and DOE’s selection materials do not give construction or operating dates. Lilac Solutions has separately said the first phase of its Great Salt Lake facility plans initial lithium production in 2028. How much of the automotive shortfall defense demand can absorb is also not something the current figures answer.
Sources
U.S. Department of Energy – Battery Materials Processing Grants
U.S. Department of Energy – Battery Manufacturing and Recycling Grants
Lilac Solutions – Lilac Solutions Selects Hatch as EPCM Partner for Great Salt Lake Lithium Facility
IRS – Instructions for Form 7207, Advanced Manufacturing Production Credit
TechCrunch – US battery startups have found a lifeline in defense
