[Washington Post] The American Battery Boom is on Shaky Ground

While batteries don’t generate electricity, they help store any source of energy to help prevent brownouts during peak energy demand. The benefit helps reduce the need for backup power plants (referred to as “peakers”) – which are more expensive and polluting than batteries. – to address the challenge generated from brief peaks in energy demand. Overall, batteries have become a crucial part of the fight against rising energy costs in the United States.

However, after years of rapid growth analysts predict a downturn in new battery production after chaotic developments in energy policy. President Trump initially imposed a 145% tariff on China, the largest supplier of batteries in the world, and the State of Texas proposed restricting construction of renewable energy projects which would have affected the battery marketplace. While the President later reduced the tariff rate and the Texas legislation failed to pass, the threat of hostile policies has incited caution among investors.

Still, the benefits that batteries offer companies are too tempting for them to stop purchases – especially when factoring the years-long backlog that natural gas turbines experience. Batteries may also benefit from misfortunes experienced from the Electric Vehicle (EV) market: because of lapsed tax credits for EVs, factories originally intended to produce them are being reconfigured to produce batteries instead. Regardless, by 2030 any battery produced with more than a quarter of parts from China will no longer qualify for federal tax credits. For American battery manufacturers, time is of the essence to produce more batteries domestically.

You can read the full article here for more details.