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Business News/ Companies / News/  Epsilon Advanced Materials to invest $650 million to establish EV battery facility in the US
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Epsilon Advanced Materials to invest $650 million to establish EV battery facility in the US

The unit is expected to be operational by 2026, generating more than 1,500 direct and indirect jobs. It is projected to reach full capacity by 2031, generating an estimated revenue of $500 million.

The US aims to achieve a 50% electric vehicle market share by 2030 and producing 1,000 GWh of battery capacity for critical mineral security. (File Photo: Bloomberg)Premium
The US aims to achieve a 50% electric vehicle market share by 2030 and producing 1,000 GWh of battery capacity for critical mineral security. (File Photo: Bloomberg)

New Delhi: Battery material company Epsilon Advanced Materials (EAM) plans to invest $650 million to set up a synthetic graphite anode manufacturing facility in the United States.

The proposed facility, with a targeted annual capacity of 50,000 tonne, will utilize cutting-edge green technologies to produce high-capacity anode materials, contributing to the power needs of over 1 million electric vehicles (EVs).

The unit, which is the company's fist investment in the US, is expected to be operational by 2026, generating more than 1,500 direct and indirect jobs. It is projected to reach full capacity by 2031, generating an estimated revenue of $500 million.

This investment announcement was part of the joint statement by President Joe Biden and Prime Minister Narendra Modi during the latter's recent state visit to the US.

While the specific location for the facility is yet to be finalized pending regulatory approvals, environmental permitting, and state and local incentive agreements, EAM has already secured strategic supply agreements with local raw material suppliers and transport partners.

This investment marks the largest Indian venture in the US EV battery industry to date. It also aligns with Biden government's ambitious goals of achieving a 50% electric vehicle market share by 2030 and producing 1,000 GWh of battery capacity for critical mineral security.

EAM's MD, Vikram Handa, said, “The battery value chain is a critical enabler to electric mobility adoption, and we are channelizing our efforts to localise the battery manufacturing ecosystem."

Demand for critical minerals, particularly graphite, has skyrocketed in recent years due to the rapid growth of the EV market and the increasing uptake of renewable energy sources. The Benchmark Mineral Intelligence Report projects a global supply deficit of 777,000 tonne of graphite by 2030, necessitating an estimated $12 billion investment in graphite production by 2035 to meet surging demand.

The US Inflation Reduction Act (IRA) presents a significant opportunity for India's chemical industry to reduce reliance on China by transforming minerals into battery materials. Under the IRA, sourcing critical battery materials from China would not qualify for the $7,500 credit per EV. As US automakers actively seek alternative countries for these materials, EAM's investment is poised to benefit both the US and India as strong trade partners.

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ABOUT THE AUTHOR
Krishna Yadav
Krishna, a lawyer turned journalist, is a key member of Mint's corporate team. He covers major legal battles in Delhi's courtrooms, with a focus on finance, markets, and policy. Additionally, he crafts easy-to-understand explainers for complex stories and holds a PG Diploma from the renowned Asian College of Journalism.
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Published: 26 Jun 2023, 10:50 AM IST
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