Biden Administration Announces Supply Chain Disruptions Task Force

June 8, 2021

The Biden administration announced the creation of a new federal task force that will aim to address near-term supply chain issues affecting a number of industries, including mining.

The U.S. Department of Commerce released the findings of its 100-day review of U.S. access to critical products and minerals used for everything from medicine to electric vehicles.

The supply chain task force will look to identify specific violations that have contributed to a "hollowing out" of supply chains that could be addressed with trade remedies, including toward China, senior administration officials told Reuters.

Officials also said the Department of Commerce was considering initiating a Section 232 investigation into the national security impact of neodymium magnet imports used in motors and other industrial applications, which the United States largely sources from China.

In a statement, the White House said the Biden-Harris Administration has already begun to take steps to address supply chain vulnerabilities including working with companies that manufacture and use semiconductor chips to identify improvements in supply chain management practices that can strengthen the semiconductor supply chain over time.

The Department of Defense (DOD) also announced an investment in Lynas Rare Earths for the expansion of the largest rare earth element mining and processing company outside of China to provide the raw materials necessary to help combat the climate crisis.

“These efforts are critical because, as the COVID-19 pandemic and resulting economic crisis have shown, structural weaknesses in both domestic and international supply chains threaten America’s economic and national security,” the statement from the White House read. “While amplified by the public health and economic crisis, decades of underinvestment and public policy choices led to fragile supply chains across a range of sectors and products. Unfair trade practices by competitor nations and private sector and public policy prioritization of low-cost labor, just-in-time production, consolidation, and private sector focus on short-term returns over long-term investment have hollowed out the U.S. industrial base, siphoned innovation from the United States, and stifled wage and productivity growth.”

Among its goals, the task force will work to secure an end-to-end domestic supply chain for advanced batteries. The Department of Energy (DOE) will release a National Blueprint for Lithium Batteries to codify the findings of the battery supply chain review in a 10-year, whole-of-government plan to urgently develop a domestic lithium battery supply chain that combats the climate crisis by creating good-paying clean energy jobs across America. DOE will host a Battery Roundtable, including representatives from each segment of the battery supply chain, to discuss the blueprint.

DOE’s Loan Programs Office (LPO) will immediately leverage the approximately $17 billion in loan authority in the Advanced Technology Vehicles Manufacturing Loan Program (ATVM) to support the domestic battery supply chain. This will include the ATVM program making loans to manufacturers of advanced technology vehicle battery cells and packs for re-equipping, expanding or establishing such manufacturing facilities in the United States.

DOE’s Federal Energy Management Program (FEMP) will launch a new effort to support deployment of energy storage projects by federal agencies. It will begin with a federal government-wide energy storage review that will evaluate the current opportunity for deploying battery storage at federal sites. FEMP will also launch a call for projects from federal sites interested in deploying energy storage projects, and provide the necessary technical assistance to get those projects built.

The White House said the administration will invest in sustainable domestic and international production and processing of critical minerals.

The Department of Interior (DOI), with the support of the White House Office of Science and Technology Policy, will establish a working group composed of agencies such as the Department of Agriculture (USDA) and the Environmental Protection Agency (EPA) to identify sites where critical minerals could be produced and processed in the United States while adhering to the highest environmental, labor and sustainability standards. This working group will collaborate with the private sector, states, Tribal Nations and stakeholders — including representatives of labor, impacted communities, and environmental justice leaders — to expand sustainable, responsible critical minerals production and processing in the United States.

The Administration will establish an interagency team composed of staff from agencies including DOI, USDA, EPA, and others with expertise in mine permitting and environmental law. This team will identify gaps in statutes and regulations that may need to be updated by Congress to ensure: new production meets strong standards before mining begins, during the mining process, and after mining ends; meaningful community engagement and consultation with Tribal Nations, respecting the government-to-government relationship at all stages of the mining process; and opportunities to reduce time, cost, and risk of permitting without compromising strong environmental and consultation benchmarks are fully explored.

DOD will deploy DPA Title III incentives — including grants, loans, loan guarantees, and offtake agreements — to support sustainably-produced strategic and critical materials, including scaling proven research and development concepts and emerging technologies from other programs such as the Small Business Innovation Research awardees.

The DOE LPO, through its Title 17 Renewable Energy and Efficiency Energy Projects solicitation, has more than $3 billion in loan guarantees available to support efficient end-use energy technologies, such as mining, extraction, processing, recovery, or recycling technologies, of critical materials projects that satisfy Title 17 requirements.

The U.S. Development Finance Corporation will expand international investments in projects that will increase production capacity for critical products, including critical minerals and other products identified pursuant to the E.O. 14017 process, ensuring that investments that support supply chain resilience and uphold international standards of environmental and social performance.

 

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