$2.4 Billion in Federal Funding for Battery and EV Companies

President Barack Obama may not usually put Elkhart, Indiana on his travel itinerary, but he was there yesterday to announce that a local company, Navistar International, was a winner in the sweepstakes that awarded $2.4 billion in Department of Energy stimulus funding to companies that make batteries and electric vehicles to power our "next generation" transportation future.

Navistar, which makes electric trucks, was awarded $39 million. But there were 47 other award winners--and 210 losers (seeking $9.6 billion)--as administration officials fanned out across the country to demonstrate that the stimulus program was working.

Vice President Joe Biden was in Detroit to hand out more than $1 billion to companies and universities based there. Energy Secretary Steven Chu was in Charlotte, North Carolina, to announce that Celgard would get $49 million for lithium-ion battery technology. And EPA Administrator Lisa Jackson traveled all the way to St. Petersburg, Florida, where Saft America is building a new battery plant for EVs and military vehicles.

Without a doubt, $2.4 billion is a lot of money, and administration officials made the grandiose--but probably true--statement that it was the largest single investment ever in advanced batteries for hybrids and electric vehicles (EVs).

To get an award, it seemed to matter that factory investments were in struggling Michigan (California battery makers were mostly ignored). An existing agreement with a Detroit automaker helped, as did a good working relationship with the DOE. One such company, eTec/ECOtality "had a long history as a consultant to the Department of Energy," said Mark Perry of Nissan, eTec's partner in an ambitious plan to wire five regions with 12,500 charging stations and supply them with 5,000 Nissan Leaf EVs. That plan, the recipient of $99.8 million, includes a data-gathering element that should aid future EV charging networks.

Other battery makers that received largesse from the program include A123, Johnson Controls, the aforementioned Saft America, Exide, East Penn Manufacturing, LG Chem (through Compact Power) and EnerDel.

And the Big Three automakers won out as well. GM was awarded more than $210 million, Ford more than $90 million and Chrysler $70 million. That funding will lead to Ford and Chrysler plug-in hybrid test programs, and to better battery packs for the Chevrolet Volt.

There was some sour grapes among the more than 200 losers, who mostly pointed out that private capital is very difficult to raise these days. One company that was not on the list said its application had totaled more than 1,100 pages. And it made the case that its batteries represented the best technology in the world.