DOE Offers $2.4 Billion to Support Next-Generation Electric Vehicles

    March 19, 2009

    President Barack Obama announced on March 19 that DOE is offering up to $2.4 billion in American Recovery and Reinvestment Act funds to support next-generation plug-in hybrid electric vehicles and their advanced battery components. Of the $2.4 billion, $1.5 billion in grants will go to U.S. manufacturers to produce high-efficiency batteries and their components; $500 million in grants will go to U.S. manufacturers to produce other components needed for electric vehicles, such as electric motors; and $400 million will go towards projects that demonstrate and evaluate plug-in hybrids and other electric infrastructure concepts. When these plug-in hybrid vehicles are offered for sale, U.S. residents who purchase them will be able to claim a tax credit of up to $7,500. Building a plug-in hybrid vehicle industry in the United States will create tens of thousands of jobs and will reduce our nation's dependence on foreign oil.

    DOE will provide assistance to construct or upgrade battery manufacturing, component, and recycling plants for lithium-ion and other advanced batteries, as well as for factories producing the power electronics for electric drive vehicles. These agreements will help lower the cost of battery packs, batteries, and electric propulsion systems. DOE will also support demonstration, evaluation, and education projects to help develop the market for advanced electric drive vehicles. The $2.4 billion in funding is divided between two Funding Opportunity Announcements. Applications for Transportation Electrification are due by May 13, and applications for the Electric Drive Vehicle Battery and Component Manufacturing Initiative are due by May 19.

    Plug-in hybrid electric vehicles will travel up to 40 miles without recharging, allowing most U.S. commuters to drive to work and back without using any fuel. Beyond that 40-mile range, the vehicles will run much like today's hybrids, achieving high fuel economies. Overall, plug-in hybrids are expected to achieve fuel economies as high as 100 miles per gallon. But for such vehicles to be practical will depend on the development of advanced, lightweight batteries that can meet tough requirements for durability and performance. See the DOE press release and the Vehicle Technologies Program.