Biden to utilize Defense Production Act for electric vehicle battery materials.

• To boost domestic production of minerals needed for EV batteries and long-term energy storage, President Biden will invoke the Defense Production Act.
• Government funding for feasibility studies on projects that extract materials such as lithium, nickel, cobalt, graphite, and manganese could be provided through Biden's order.
• The White House declared a new release of oil from its strategic reserves to reduce gas prices and combat inflation in the U.S.

To reduce dependence on foreign supply chains, President Joe Biden will utilize the Defense Production Act to promote the domestic production of minerals needed for electric vehicle batteries and long-term energy storage.

Government funding for feasibility studies on projects that extract materials for EV production could be provided through the president's order.

The Defense Production Act, enacted by President Truman during the Cold War, empowers the president to utilize emergency powers to prioritize the production of certain materials for the nation.

The White House announced on Thursday that the President will issue a directive, allowing the use of the Defense Production Act to ensure American production of critical materials for the clean energy economy, thereby reducing dependence on China and other countries for the minerals and materials needed to power our clean energy future.

The Department of Defense will enforce strict consultation standards with environmental, labor, community, and tribal groups, according to the White House. Additionally, the administration is reviewing potential applications of the law to promote safer, cleaner, and more resilient energy sources in America.

One-third of U.S. greenhouse gas emissions come from the transportation sector, and transitioning from gas vehicles to EVs is crucial in fighting climate change.

The demand for lithium has surged as automakers rush to create EVs. By 2030, the growth in the number and size of batteries for EVs could account for more than 90% of lithium demand, according to Benchmark Mineral Intelligence. Additionally, AlixPartners predicts that about 24% of new vehicles sold worldwide will be fully electric by 2030.

Lithium Americas, a resource company focused on lithium development, commended the Biden administration for their efforts to secure the production of critical minerals like lithium here at home, while expressing anticipation for the specifics of the president's announcement.

The administration in February announced a plan to allocate $5 billion to states to fund EV chargers over five years as part of the bipartisan infrastructure package. The U.S. is the world's third-largest market for EVs, with China and Europe leading the way.

The Sierra Club President, Ramón Cruz, expressed gratitude in a statement for President Biden's efforts to promote clean energy and enhance the US's leadership in the global transition.

Cruz emphasized the importance of doing it right, ensuring that labor and environmental standards are not compromised, and that crucial consultations with affected Tribal nations and communities are conducted.

On Thursday, the White House declared a new release of oil from its strategic reserves to reduce gas prices and combat inflation in the U.S. This move was announced as the administration tries to address the rise in energy prices resulting from Russia's invasion of Ukraine.

— CNBC’s Cat Clifford and Pippa Stevens contributed reporting.