May 29 -- The Loan Programs Office (“LPO”) of the U.S. Department of Energy (“DOE”) is seeking public input on this RFI to inform LPO's implementation of the Inflation Reduction Act of 2022 provisions relating to the Advanced Technology Vehicles Manufacturing Loan Program (the “ATVM Program”). Written comments are requested by June 28, 2024.
On August 16, 2022, President Joseph R. Biden signed the landmark Inflation Reduction Act of 2022 (“IRA”) into law, which in part supports the broad goals of deploying clean energy, strengthening domestic manufacturing, and investing in workers and communities. The IRA reflects advanced technology vehicle manufacturing's role in advancing transportation decarbonization and the supply chain goals of the Nation and U.S. manufacturers. Specifically, section 50142 of the IRA appropriates $3 billion, available through September 30, 2028, for the costs of providing direct loans under section 136(d) of the Energy Independence and Security Act of 2007, the underlying authority for DOE's ATVM Program.
The ATVM Program can provide financing to help deploy eligible advanced technology vehicles or the manufacturing of qualifying components for eligible vehicles in the United States. These projects can be along the advanced technology vehicle value chain, including processing of critical materials for advanced technology vehicles; manufacturing of battery cell components, battery cells, battery modules, and battery packs for electric vehicles (“EVs”); recycling of battery components or critical materials; manufacturing of various nonroad advanced technology vehicles or their components; or manufacturing of EV charging infrastructure components, among other areas. The ATVM Program supports applicants' efforts to reequip, modernize, or expand existing facilities for these purposes, and/or support engineering integration performed related to the manufacturing of eligible vehicles or components in the United States.
Onshoring and reshoring parts of advanced technology vehicle supply chain is an important part of helping the United States increase its energy independence and bolster its competitiveness in a global supply chain. Advanced technology vehicles are often dependent on a consistent and predictable supply chain. Today, the United States relies heavily on importing advanced technology vehicle supply chain components from abroad, exposing the nation to supply chain vulnerabilities that threaten to disrupt the availability and cost of these technologies, as well as the workforce that manufactures them.
LPO projects are often first movers in these sectors in the United States, helping American manufacturers scale up domestic manufacturing capacity, develop technical know-how, and create good-paying American jobs in new sectors. By providing flexible access to capital for borrowers in clean energy sectors where traditional commercial debt is unavailable, LPO can help support American entrepreneurs' efforts in these areas. This is critical as DOE seeks to deploy advanced technology vehicle production at scale while protecting the research, technology, and economic security interests of the American people. Investment in American manufacturing also helps the United States lead the world in clean energy industries and positions U.S. firms to export these clean technologies to our global partners. In addition, supporting the advanced technology vehicle supply chain and deploying these vehicles helps meet our climate and emissions reduction objectives as a Nation.
President Biden set an ambitious goal that at least 50 percent of all new passenger cars and light trucks and at least 30 percent of all medium and heavy-duty vehicles sold in 2030 be zero-emission vehicles, including battery electric, plug-in hybrid electric, or fuel cell EVs. The transportation sector is the largest source of greenhouse gas (“GHG”) emissions in the United States, accounting for 27 percent of all emissions in 2020. Transportation also is a major source of smog-forming nitrogen oxides and particulate matter, which can trigger asthma attacks and other health problems for the most vulnerable among us. Advanced technology vehicles and qualifying components stand to help reduce GHG emissions and other mobile source air pollutants that may have a disproportionate impact on the air quality in overburdened and underserved communities.
Onshoring and reshoring parts of advanced technology vehicle supply chain in the United States is critical to growing America's manufacturing base, reaching the Biden-Harris Administration's climate and multi-pollutant emissions reduction objectives, and protecting taxpayer resources and our national security.
Section 136 of the Energy Independence and Security Act of 2007, as amended (42 U.S.C. 17013) (the “ATVM statute”) authorizes the Secretary of Energy (the “Secretary”) to issue grants and direct loans to applicants for the costs of reequipping, expanding, or establishing manufacturing facilities in the United States to produce qualified advanced technology vehicles, or qualifying components. The ATVM statute also authorizes the Secretary to issue grants and direct loans for the costs of engineering integration performed in the United States of qualifying advanced technology vehicles and qualifying components. The ATVM Program represents the Secretary's implementation of the direct loan authority under the ATVM statute and is administered by LPO. The purpose of the ATVM Program is to originate, underwrite, and service loans to eligible vehicle manufacturers and component manufacturers to finance the cost of: (i) reequipping, expanding or establishing manufacturing facilities in the United States to produce advanced technology vehicles and qualifying components; and (ii) engineering integration performed in the United States of advanced technology vehicles and qualifying components. These manufacturing facilities support vehicles that demonstrate improved performance and/or emissions standards compared to the existing vehicle fleet, in furtherance of the Administration's transportation decarbonization and EV goals.
Section 40401(b) of the Infrastructure Investment and Jobs Act (the “IIJA”) amended the definitions provision of the ATVM statute to add the following categories of vehicles within the ATVM statute's definition of “advanced technology vehicle”: a medium duty vehicle or a heavy duty vehicle that exceeds 125 percent of the greenhouse gas emissions and fuel efficiency standards established by the final rule of the Environmental Protection Agency entitled “Greenhouse Gas Emissions and Fuel Efficiency Standards for Medium- and Heavy-Duty Engines and Vehicles-Phase 2” (81 FR 73478 (October 25, 2016)); a train or locomotive; a maritime vessel; an aircraft; and hyperloop technology.
Section 50142 of the IRA appropriates $3 billion for the ATVM Program, including to support direct loans for projects in the categories of advanced technology vehicles added to the program by the IIJA. However, section 50142 also provides that, with respect to trains or locomotives, maritime vessels; aircraft; and hyperloop technology, such funds may be used for that purpose “only if such advanced technology vehicles emit, under any possible operational mode or condition, low or zero exhaust emissions of greenhouse gases” (emphasis added). This standard was made part of the ATVM Program regulations at 10 CFR part 611.
LPO is currently establishing additional criteria pursuant to which it will evaluate loan applications under the expanded categories of advanced technology vehicles, including satisfaction of the GHG emission requirements of the IRA. LPO expects that these requirements will evolve over time as each applicable advanced technology vehicle sector matures.
The purpose of this RFI is to solicit feedback from manufacturers, project and technology developers, investors, minority-owned businesses, academia, research laboratories, government agencies, State and local officials, labor unions, Tribes, community-based organizations, and other interested parties on issues related to the implementation of the changes to the ATVM Program stemming from the IRA and IIJA. This is solely a request for information.
A. Trains or Locomotives . . .
B. Maritime Vessels . . .
C. Aircrafts . . .
D. Hyperloop Technology . . .
E. Community Jobs & Justice . . .
FRN:
https://www.federalregister.gov/d/2024-11723