LPO Announces Conditional Commitment to ENTEK Lithium Separators to Build Indiana EV Battery Separator Manufacturing Plant

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Today, the U.S. Department of Energy’s (DOE) Loan Programs Office (LPO) announced a conditional commitment of up to $1.2 billion for a direct loan to ENTEK Lithium Separators LLC (ENTEK). If finalized, the loan will substantially finance a new facility in Terre Haute, Indiana to manufacture lithium-ion battery separators. The separators will be used primarily in electric vehicles (EVs)—strengthening the U.S. lithium-ion battery cells supply chain and enabling the creation of batteries used in advanced technology vehicles. This project supports the Biden-Harris Administration’s whole-of-government approach to building a clean energy future and helping ensure the United States can meet the expected future demand for EV adoption, which has seen unprecedented progress under President Biden.

Today’s announcement reinforces President Biden’s Investing in America agenda to create good-paying, high-quality jobs in communities across the country and ensure workers benefit from America’s growing clean energy economy. The project is expected to create 763 construction jobs and 635 operational jobs.

LPO works with all borrowers to develop and implement a strong Community Benefits Plan (CBP) that ensures borrowers meaningfully engage with community, environmental, and labor stakeholders to create good-paying jobs, improve the well-being of residents and workers, and minimize and mitigate any environmental impacts. One aspect of ENTEK’s CBP is their commitment to creating opportunities for local labor, prioritizing hiring local workers who have been displaced from manufacturing industries. To recruit workers, ENTEK has forged partnerships with various institutions, such as Ivy Tech Community College, Indiana State University, and various community-based organizations. ENTEK is partnering with Ivy Tech to provide access to specialized training and apprenticeship programs, creating recruitment opportunities for disadvantaged communities. ENTEK has also been working very closely with local building and trades unions.

A battery separator is a membrane sandwiched between the anode and cathode of a battery. The principal functions of the battery separator are to prevent electronic conduction (i.e., shorts or direct contact) between the anode and cathode while permitting ionic conduction via the electrolyte. Separators play an essential role in the performance and safety of lithium-ion batteries.

This project supports the Biden-Harris Administration’s efforts to expand and secure reliable, environmentally sustainable clean energy domestic supply chains key to reaching the country’s ambitious climate goals while reducing reliance on economic competitors like China. DOE estimates that by 2030, the North American lithium-ion EV battery industry will require annual separator production of 7 to 10 billion square meters. Once complete, the facility is expected to have the capacity to manufacture 1.72 billion square meters of separator material annually for the North American EV market. Based on the LPO technical team’s analysis, the number of EVs supported by this project depends upon the battery form factor (cylindrical, pouch, or prismatic) used for various battery chemistries. Each GWh of cell manufacturing requires 7-10 million square meters of battery separator depending on the battery form factor. Based on current form factors chosen by cell manufacturers, the project will support roughly 1.9 million mid-size EVs or 1.3 million eSUVs.

The project will make a significant contribution to growth in domestic battery separator capacity and help U.S. EV manufacturers satisfy battery component sourcing requirements under the 30D Clean Vehicle Credit. The tax credit, included in the President’s Inflation Reduction Act, offers up to $7,500 for the purchase of new clean vehicles.

ENTEK will be able to customize battery separators to accommodate numerous EV battery designs. The separators produced will be able to accommodate all existing lithium-ion EV battery chemistries, including NMC, NCA, LMFP, and LFP. Additionally, ENTEK will be able to sell its separators to manufacturers of lithium-ion batteries for energy storage applications.

This project reinforces President Biden’s Investing in America agenda to onshore and re-shore domestic manufacturing technologies that are critical to meeting the Biden-Harris Administration’s goal that half of all new vehicles sold in 2030 are zero-emissions vehicles. Today’s announcement also supports the President’s comprehensive strategy to build a safer, more sustainable transportation system and slash all greenhouse emissions from the transportation sector by 2050.

Domestic EV manufacturing has surged in response to the massive growth in the domestic and global EV markets and the financial incentives recently made available under President Biden’s Inflation Reduction Act and Bipartisan Infrastructure Law. ENTEK aims to become the United States’ first end-to-end, domestic supplier of “wet process” battery separators for the North American lithium-ion EV battery market.

If finalized, the loan would be offered through the Advanced Technology Vehicles Manufacturing (ATVM) Loan Program, which provides loans to support U.S. manufacturing of advanced technology vehicles, qualifying components, and materials that improve fuel economy. With several recent ATVM projects in the last year, LPO is helping support the Biden-Harris Administration’s EV adoption goals.

While this conditional commitment indicates DOE’s intent to finance the project, DOE and the company must satisfy certain technical, legal, environmental, and financial conditions before the Department enters into definitive financing documents and funds the loan.


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