Latest news with #AdvancedManufacturingProductionCredit
Chicago Tribune
a day ago
- Automotive
- Chicago Tribune
Controversial Ford battery plant ‘on track' to remain eligible for key federal support
WASHINGTON — Ford Motor Co. confirmed Tuesday that its multibillion-dollar battery plant in south-central Michigan remains 'on track' to qualify for a crucial federal tax credit, despite new federal restrictions on sourcing from China. 'Ford is committed to making the best, most cost-effective batteries for the next generation of electric vehicles in the United States,' company spokesperson Robyn Jackson said in a statement. 'BlueOval Battery Park Michigan is on track to qualify for the production tax credit — a win for our customers and a win for American competitiveness.' The Marshall, Michigan, plant has been controversial because of Ford's agreement to license technology from Chinese battery giant Contemporary Amperex Technology Co. Ltd. at the new facility, an arrangement that sparked backlash and threatened business plans with some 60% of construction complete. The new federal restrictions came via Republicans' One Big Beautiful Bill Act, a massive tax cut and spending package that President Donald Trump signed into law over the weekend. An earlier U.S. House version of the bill would have torpedoed Ford's eligibility for the federal Advanced Manufacturing Production Credit, but an all-out lobbying effort helped the Dearborn-based automaker secure favorable changes in the U.S. Senate. The credit in question, also known as the 45X credit, targets battery producers and upstream industries. Battery cells, which store and release energy needed to power EVs, are each eligible for a credit of $35 per kilowatt-hour of energy they can store and $10 per kilowatt-hour for battery modules or pack assembly. The Marshall plant's capacity is 20 gigawatt-hours per year. Ford's company statement uses careful language to describe its tax credit status, as the U.S. Department of the Treasury still needs to finalize implementation guidelines based on the congressional directive. Those guidelines will more firmly determine the plant's eligibility. Ford CEO Jim Farley has called the credit 'critical for our industry,' but the House bill explicitly excluded components made as a product of licensing agreements with prohibited foreign entities — a designation that applies to CATL. The final Senate version removed that language. Ford Executive Chairman Bill Ford originally said ineligibility of the production tax credit would 'imperil' the $3 billion plant expected to create 1,700 jobs. Lisa Drake, Ford's vice president of technology platform programs and EV systems, later clarified that the automaker planned to 'stick behind' Marshall, but said losing the credit could delay production and hiring. The executives underscored that if EVs are going to be affordable, the company needs the advanced Chinese battery technology, and if it cannot build those cells economically in the United States, it will have to source from elsewhere. Tesla Inc. has bought CATL's lithium-iron-phosphate batteries made in China for U.S. EVs. Detroit-based General Motors Co. plans to do so, as well, until it can domestically produce lithium manganese-rich batteries, a technology Ford also is developing.
Korea Herald
3 days ago
- Automotive
- Korea Herald
LG Energy Solution returns to profit in Q2 on strong US demand
LG Energy Solution said Monday that it posted a profit in the second quarter of this year, primarily driven by its stellar performance in electric vehicle and energy storage systems in the North American market. According to the company's preliminary earnings, from April to June, its operating profit skyrocketed 152 percent to 492.2 billion won ($360.5 million), while sales revenue slipped 9.7 percent to 5.56 trillion won from the previous year. This figure marks the first time in six quarters that LG Energy Solution has recorded a profit when not including financial benefits from the Advanced Manufacturing Production Credit outlined in the US Inflation Reduction Act. The company posted an AMPC-excluded profit of 1.4 billion won in the second quarter. 'Several key factors have contributed to the increase in profit, including rising demand for highly profitable battery products from North American clients, local ESS production in North America and ongoing cost-saving efforts,' said an industry source familiar with the matter, on condition of anonymity. LG Energy Solution signed an agreement with the US-based Delta Electronics to supply 4 gigawatt-hour battery cells for ESS applications, enough to power 400,000 US households for a day. The company began mass production of lithium iron phosphate (LFP) pouch cells at its Michigan plant last month, marking the first instance of a global battery manufacturer starting large-scale LFP battery production for ESS within the US. However, the source noted that sales declined during the same period, partly due to conservative inventory management by European automakers and a drop in production volume in China. This adjustment was a strategic move to minimize exposure to US tariffs on Chinese-manufactured ESS products. As part of its cost-reduction strategies, the battery maker decided to suspend the planned ESS investment in Arizona and instead utilize the Michigan plant earlier in the year. In response to a downturn in the global EV industry, the company also acquired a third joint venture plant with General Motors in Michigan to address the EV battery demand initially intended for LG's Michigan facility. 'We are aware of the increased external volatility from major US policy changes, which makes it challenging to predict market demand,' stated LG Energy Solution in a press release. 'However, we consider the initiation of mass production for new battery chemistry products targeting European EVs and the full-scale ESS production in North America as key opportunities to improve our earnings in the latter half of this year.' Industry insiders suggest that the recent passage of Donald Trump's 'One Big Beautiful Bill' is expected to have a limited impact on Korean battery companies such as LG Energy Solution. This is because the AMPC is set to conclude at the end of 2031, only a year earlier than originally planned. On the other hand, the $7,500 consumer tax credit for new EV purchases under the IRA has been accelerated to this September from the end of 2032.
Miami Herald
25-06-2025
- Business
- Miami Herald
Huge solar equipment manufacturer files for Chapter 11 bankruptcy
The U.S. solar energy industry has faced many of the same economic issues that other retail and manufacturing industries have dealt with, including rising labor and product costs driven by inflation, higher interest rates on debt obligations, and extreme competition from across the world. Some economic factors unique to the solar industry, however, threaten to put some companies out of business. Don't miss the move: Subscribe to TheStreet's free daily newsletter The solar industry may face a potential revenue disaster if Congress follows through with proposals to phase out or eliminate tax credits for developers of renewable energy products and manufacturers of renewable energy technology. Related: Popular children's retailer files for Chapter 11 bankruptcy The Inflation Reduction Act of 2022 implemented the Advanced Manufacturing Production Credit in IRC Section 45X, which provides lucrative tax credits for eligible components produced or sold between Jan. 1, 2023, and Dec. 31, 2032. The tax credits will provide billions of dollars of tax benefits for developers and manufacturers of solar equipment if fully implemented. Congress, however, might snuff out that lucrative tax benefit for solar equipment manufacturers if new legislation is signed into law. The U.S. House of Representatives on May 22, 2025, passed its version of the budget reconciliation bill, HR 1, President Trump's One Big Beautiful Bill Act, which includes proposed revisions to the existing law that would phase out or eliminate the IRC Section 45X tax credits. The tax credits are still in limbo as the U.S. Senate is still deliberating on HR 1, trying to reconcile its version with the House version. Eliminating the Section 45X tax credits may force several solar equipment companies out of business, putting thousands more workers in the unemployment line. One company has been pushed over the edge by just the threat of tax credits disappearing. Major solar energy equipment manufacturer Meyer Burger Holding Corp. filed for Chapter 11 bankruptcy, seeking a sale of its assets and to halt a Worker Adjustment and Retraining Notification Act lawsuit after abruptly closing its Arizona plant. Related: Another national retail chain files for Chapter 11 bankruptcy The Goodyear, Ariz.-based debtor, which is a subsidiary of parent company Meyer Burger AG of Switzerland, filed its petition in the U.S. Bankruptcy Court for the District of Delaware on June 25, listing $100 million to $500 million in assets and about $560 million in debts. The debtor owes about $89 million from a secured bridge loan, about $370 million in unsecured intercompany loans, and about $100 million in unsecured trade payables and other unsecured debts. More bankruptcy: Iconic auto repair chain franchise files Chapter 11 bankruptcyPopular beer brand closes down and files Chapter 7 bankruptcyPopular vodka and gin brand files for Chapter 11 bankruptcy The debtor will seek debtor-in-possession financing, which includes a roll-up of preparation secured debt, and a bidding procedures motion with a stalking-horse bidder offer to purchase the company in a Section 363 sale, according to court papers. The debtor said financial and operational setbacks from an inundation of the global solar market with low-priced Chinese products and debilitating trade restrictions affected the European market and prompted the debtor to expand into the U.S. solar market with the opening of an Arizona solar module plant. The debtor faced financial issues related to its Arizona solar module manufacturing facility, as the plant's production line design didn't meet the intended solar module design, requiring a six-month delay and redesign of the production lines. The Arizona facility cost $60 million and 12 months to complete and was expected to produce 10,000 solar modules a day and employ 600 workers. The facility, however, consists of two partially installed production lines that never reached full production capacity, and a third line installation was delayed because of a shifting business plan and deteriorating financial condition. A planned Colorado Springs, Colo., solar cell manufacturing facility was discontinued due to the company's inability to obtain necessary financing. Meyer Burger was unable to secure adequate financing to complete construction of the Arizona module plant and the Colorado cell facility, and its affiliates in Switzerland and Germany were forced into insolvency proceedings. The company also faced economic issues from global supply chain disruption. At full capacity, the company expected to generate almost $1.3 billion in tax credits through the Inflation Reduction Act of 2022, but production setbacks significantly reduced the company's benefit. Congressional plans to phase out or eliminate the tax credits caused uncertainty with lenders and investors, which impacted the company's out-of-court restructuring and recapitalization plans. After an investor terminated a restructuring and recapitalization deal at the beginning of May 2025, manufacturing challenges and macroeconomic headwinds forced the debtor to lay off all 400 employees at the Arizona plant and shut down production by May 31, 2025. The shutdown prompted former employees to file a class-action lawsuit alleging the company violated the Worker Adjustment and Retraining Notification Act. The debtor's Chapter 11 filing placed an automatic stay on all litigation while the bankruptcy case proceeds. Related: Popular bar and grill chain files for Chapter 11 bankruptcy The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Yahoo
28-03-2025
- Business
- Yahoo
SC's energy future: A case for expanding nuclear power to meet demand
Nuclear reactor assemblies pictured Sept. 12, 2024, in storage at V.C. Summer nuclear site near Fairfield. (Provided by S.C. Nuclear Advisory Council) South Carolina has made considerable progress in strengthening its energy and transmission infrastructure, but much more remains to be done to secure a reliable, cost-effective and independent energy future. A critical piece of this effort lies in expanding nuclear power, which offers the unique combination of low-carbon emissions, sustainability, 24/7 reliability, and long-term affordability. This is why I fully support an 'all-of-the-above' approach to energy, including the revitalization of the unfinished reactors at the V.C. Summer Nuclear Station, and commend the South Carolina's state and congressional lawmakers for taking decisive steps to advance nuclear energy in our state. Efforts to expand South Carolina's clean energy portfolio have already incentivized energy-efficient practices, expanding nuclear capabilities, and attracted private-sector investment in emerging renewable energy. Tax credits such as the Advanced Manufacturing Production Credit and the Advanced Energy Production Credit fuel business growth in the Palmetto State. However, more work remains as our state's energy demands are growing rapidly due to population increases and economic expansion. State leaders and utility officials have been increasingly focused on the growth in demand for energy. Our major utilities are already experiencing unprecedented load demand growth. South Carolina's population growth and accelerating economic development have caused utility planners to drastically increase their load growth forecasts, with electricity demand expected to surge over the next 15 years. This demand growth will require an 'all-of-the-above' increase in electricity generation capacity, including natural gas, renewables, and nuclear. It will also require a more streamlined approach to the planning and construction of new energy generation, regardless of the energy source. To meet these challenges, South Carolina's policymakers are now considering legislation that strengthens our energy sector, streamlines permitting and accelerates energy generation capacity. Last month, the South Carolina House of Representatives passed H.3309, the South Carolina Energy Security Act, a bill prioritizing nuclear expansion as an energy source, alongside natural gas, hydrogen and renewables. The state Senate will next debate this measure. The Senate can develop legislation that balances reasonable permitting reforms with environmental protections, ensures appropriate regulatory oversight of the utilities while accelerating new energy generation, and prioritizes an 'all-of-the-above' energy strategy that includes the expansion of nuclear energy. Reviving the V.C. Summer nuclear project represents one of the most promising opportunities to meet South Carolina's energy needs. Sen. Lindsey Graham recently affirmed his support for nuclear power, stating, 'We cannot give up on nuclear power … South Carolina needs as much power as we can get.' His leadership and advocacy for small modular reactors (SMRs) highlight the potential of modern nuclear technology to supplement traditional reactors and provide scalable, efficient energy solutions for our state. As Congress sets its legislative agenda, Graham and South Carolina's delegation can prioritize continued support for policies that modernize the state's energy infrastructure, revitalize manufacturing, and strengthen national security. Sen. Tim Scott has also championed efforts to ensure nuclear energy can be deployed more efficiently. His recently introduced Nuclear Permitting Reform bill takes a commonsense approach to cutting through the bureaucratic red tape that slows down nuclear project approvals. By reducing unnecessary delays and modernizing regulations, this bill would pave the way for projects like V.C. Summer's revival and the expansion of next-generation nuclear technology in South Carolina. Beyond state efforts, federal investments are playing a crucial role in advancing energy security. The Inflation Reduction Act, passed in 2022, has provided South Carolina homes and businesses with key tax credits and incentives that help increase energy efficiency, promote solar energy, clean hydrogen and nuclear power production, and support offshore wind development. Funding from that law has also fueled a resurgence in American manufacturing, leading to the announcement of 29 South Carolina projects promising to bring 16,500 jobs to the state. Leveraging these resources, alongside nuclear expansion, will ensure South Carolina remains a leader in clean energy innovation. Federal and state collaboration is crucial to ensuring South Carolina remains at the forefront of energy innovation. The leadership shown by our congressional delegation and proactive efforts from our state Legislature put us in a strong position to secure our energy future. However, the job is not yet done. The state needs energy legislation that includes strong provisions for nuclear expansion and balanced permitting reform.
