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Manchin grills Granholm on Biden electric vehicle push: 'Let the market go where it's going to go'

Democratic Sen. Joe Manchin grilled Energy Secretary Jennifer Granholm on Thursday during a hearing of the Senate Energy and Natural Resources Committee.

Democratic West Virginia Sen. Joe Manchin butted heads with U.S. Department of Energy Secretary Jennifer Granholm on Thursday during a Senate hearing on green energy,

Manchin expressed frustration with the Inflation Reduction Act's tax credit for electric vehicles, taking issue with loopholes in its distinction between manufacturing and processing of materials.

"We want this done in America. We don't want this overseas because basically then there's no urgency for our manufacturing to ever do this," Manchin said. 

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The Democratic senator claimed that by grouping the production of cathode powder, lithium and other materials for battery production into "processing," the Energy Department was loosening its commitment to manufacturing electric vehicles domestically.

He continued, "That's the problem I'm having with it. If we're going to get something for it, I don't wanna be relying on foreign supply chains. I'd rather have it right here in the United States, or at least in North America. We have better control."

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Granholm pushed back on Manchin's criticisms, saying that the supply chains are trending toward domestic production due to the Inflation Reduction Act's provisions.

"We should all feel very pleased to note that in this battery supply chain — since these laws and since the beginning of the president's term, there have been 150 battery companies or a supply chain elements that have announced they're opening up in the United States," Granholm said. "Where it would have been, to your point, before in China or in Asia — 150 across all of these states. That equals almost $100 billion worth of investment in the U.S."

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The Inflation Reduction Act – the legislation from which the rules and others pertaining to things like North American final assembly stem – became law over seven months ago with President Biden's signature.

"The policy that this committee and that your leadership as well as others has passed matters. And that's why we're seeing all of these companies come to the United States, including extraction for extraction, for processing, for manufacturing, for the whole supply chain," Granholm added.

EV TAX CREDIT ELIGIBILITY TO BE REDUCED IN THE COMING MONTH

Under the act's guidance on critical minerals, 40% of the value of them in the battery "must be extracted or processed in the United States or a country with which the United States has a free trade agreement, or be recycled in North America," for this year, according to the Treasury Department

The required percentage will see incremental increases of 10% each year until it becomes 80% in 2027.

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If a newly purchased EV meets the proposed mineral and battery component requirements, it can get the $7,500 credit, according to the Treasury Department. If it only meets one of them, the EV will have it for the $3,750 one.

On a U.S. government-run website, a list of vehicles that currently have eligibility for a credit is publicly available. 

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