NAATBatt’s core mission is to promote the development, commercialization and manufacture of advanced battery technology in North America.  No organization has been more concerned about the growing concentration of lithium battery supplies and manufacturing in China than has NAATBatt.  And no organization has been more active in seeking ways for North American companies to compete more effectively in the growing lithium battery industry.

But however the market has arrived at its current state, North American manufacturers must respond to the current situation realistically.  It is one thing to try to grow domestic capacity.  That we must continue to do, and we need to do it in a number of different ways.  But it is another thing to cut ourselves off entirely from Chinese companies and Chinese supplies.  That makes no sense and will ultimately undermine the goal of creating a robust domestic advanced battery supply chain.

One of the first things we need to do is re-engage with the Chinese scientific community.  There was a time when that community was small, insignificant and sometimes rightly suspected of trying to acquire North American intellectual property not always by honorable means.  But that time has passed.  Today, the Information Technology & Innovation Foundation reports that Chinese institutions account for 65.4 percent of the high-impact research publications in electric batteries, substantially outpacing U.S. institutions’ 11.9 percent.  Chinese entities’ global share of patents in the field of electric propulsion increased from 2.4 percent in 2010 to 26.9 percent in 2020, again substantially outpacing the share coming out of North America.

The greatest long-term threat to building a robust and sustainable advanced battery supply chain in North America is the loss of scientific and innovation leadership.  North American governments and scientists need to work hard to get that leadership back.  But cutting ourselves off from leading innovative companies such as CATL rather than trying to learn from them is not a path to leadership.  It is a path to long-term, second-rate status.

We need a new approach to China in the battery and electric vehicle industries.  While we need to be mindful of possible threats and smart about how we mitigate those threats, simply cutting ourselves off from Chinese supplies, Chinese science and Chinese business leaders is not a smart strategy.  We need to start thinking hard about how we do better.

I am pleased to report that earlier this morning NAATBatt entered into a Memorandum of Understanding with three distinguished organizations from the Republic of Korea:  the Korea Battery Industry Association, the Korea Institute for Advancement of Technology and the Korea Electronics Technology Institute.

Under the Memorandum, all four organizations pledge to work together to promote friendly and profitable business relationships among our members.  This cooperation will include facilitating meetings and networking among our member companies, cooperating in pre-competitive research for next-generation battery technologies, battery reuse and battery recycling, and developing common standards for battery safety.

The signing of the Memorandum is an important and positive step in relations between the United States and the Republic of Korea.  But it is important to remember that it is but a small part of a much larger picture.

We meet today at the dawn of a new age of energy: The Age of the Electron.  Since the beginning of the Industrial Revolution, heat-based fuels have powered human society.  For many reasons that is changing.  In the future, human society will increasingly be powered by electrons not by heat. This transition is already taking place in vehicle technologies, aviation, medicine, computers, communications, consumer devices and even high energy weapons systems.

Battery technology will play a critical role in this new energy age.  Properly understood, battery technology is simply a way to deliver an electron to any point in space, at any point in time.

As we are at the very beginning of this new age, we really do not know where this new electron-based technology will lead mankind.  It is probably not for our generation to know.  But our grandchildren will know better than we do, and our great-grandchildren will know better still.

The Memorandum we signed this morning and our meeting here today will not be long remembered.  But what our grandchildren will remember is that at the beginning of the Age of the Electron their grandparents in the United States and their grandparents in Korea stood shoulder-to-shoulder and worked together to turn this new technology of electrochemical energy storage to the benefit of all their grandchildren.  And much better legacy than that, none of us can hope for.

My thanks, again, Minister Lee, for your leadership in bringing us here together.  NAATBatt looks forward to working with all our new friends in Korea for many years to come.

The elephant in the room, of course, is how do you make that happen?  The even bigger elephant is how do you ensure that the batteries that power those vehicles will be made in the United States?

The White House announcement outlines four approaches:

• Installing the first-ever national network of electric vehicle charging stations.
• Delivering point-of-sale consumer incentives to spur U.S. manufacturing and union jobs.
• Financing the retooling and expansion of the full domestic manufacturing supply chain.
• Innovating the next generation of clean technologies to maintain our competitive edge.

All four approaches will be helpful.  Installing vehicle charging stations will make electric vehicles more attractive to consumers by reducing range anxiety.  This approach seems to have political support, as the Bipartisan Infrastructure Deal which seems to be working its way through Congress includes $7.5 billion in funding for this purpose.

Supporting innovation and the retooling of the full domestic manufacturing supply chain (presumably with government grants and loans) will also be helpful. But this approach risks falling into the ARRA trap of 2009-10, which invested a lot of public money into infrastructure that the market did not ultimately support.

The single most important thing the federal government can do to ensure U.S. leadership in critical advanced battery technology is to make sure that there is a vibrant, early market for that technology in the United States.  For all the hand-wringing about Chinese leadership in battery manufacturing, it is worthwhile remembering that the Chinese did not get that leadership because they out-innovated or out-smarted the United States.  The Chinese got and continue to hold that leadership because the Chinese government made sure that there was a vibrant, early market for advanced battery technology in China that only Chinese manufacturers could reliably access.

If the United States wants to gain leadership in advanced battery technology and manufacturing, it simply needs to do what the Chinese have done in China.  There is no magic or complexity to the formula for success.

Unfortunately, incenting consumer purchases of electric vehicles and other advanced battery-powered technologies (approach #2 of the Biden Administration, summarized above) is the most politically problematic of all the approaches.  American consumers are still largely skeptical of electric vehicle technology and the whole subject of vehicle electrification has become unfortunately politicized.  As a consequence, the Bipartisan Infrastructure Deal does not contain any meaningful consumer incentives for electric vehicle procurement.

While it may be easy to blame Congress for failing to seize an opportunity, the reality is that Congress cannot get much ahead of its constituents.  It falls to the battery industry, not Congress or the Administration, to explain to the American public why battery technology will be so important to their future and why buying advanced battery-powered technologies today is practical and makes sense.  We as an industry need to re-double our public outreach efforts in the year ahead if we want to make meaningful consumer incentives for U.S.-made advanced batteries a reality.

I want to use my opening remarks to emphasize why battery technology is important to the United States.  In truth, it is not because of the battery.  Battery technology has been known to mankind for more than 2,000 years.  For most of those 2,000 years, battery technology was a curiosity, a facilitator of magic tricks.  It was not until the invention of the lead acid battery in 1859 that batteries could generate enough electricity to power major industrial processes.

We are here today because of another, more recent discovery: the lithium-ion battery, which was first commercialized in 1991.  Lithium-ion batteries are high power batteries enabled by the fourth lightest element in the universe: lithium.  Because of their relatively light weight and high-power density, lithium-ion batteries can provide electric power to a device located anywhere in space without the need of an electricity cord.  The significance of lithium-ion batteries is that they make electric power portable in ways and at a scale that have never before been possible.

Portable electric power is the real story.  Whereas 20^th Century technology was largely powered by heat-based fuels, 21^st Century technology will be powered by electricity.  Don’t blame the battery for that.  Computers, wifi and databases just don’t run very well on gasoline.

Many people believe that the move to electric vehicles is driven solely by concerns about climate change.  That is not true, though reducing carbon emissions is a very nice side benefit.  The electrification of vehicles has been going on for 50 years.  It started with power locks and power windows, moved on to heated seats and navigation systems, and is now working its way into the vehicle drivetrain.  Vehicles are simply becoming computers on wheels.  It is the natural progression of 21^st Century technology.

Since the beginning of NAATBatt we have warned that “he who makes the batteries will one day make the cars.”  That is a big deal considering that vehicle manufacturing employs about 1 million Americans and, when you consider indirect employment, it is the second largest employer of Americans after healthcare.

But even that undersells the importance of lithium batteries.  We already know that lithium batteries will enable future cars, buses, drones, consumer devices, medical devices, monitoring systems, renewable energy systems, aircraft and high-power weapons systems.  What we don’t know is what other technologies they will also power in 2040 and 2050.

I will conclude my opening remarks with a question:  What do the following five major U.S. companies have in common:  Microsoft, Google, Facebook, Amazon and Apple?  The answer:  None of them make semiconductors.  Yet I will tell you to the point of virtual certainty that had U.S. companies, entrepreneurs and workers not dominated semiconductor and computer hardware manufacturing in the 1960’s, ‘70’s and 80’s, while Microsoft, Google, Facebook, Amazon and Apple all might exist today, they would not have developed or be headquartered in the United States.

This is the challenge we face today with lithium-ion batteries.  The difference is that unlike the semiconductor industry of the 1960’s, ‘70’s and 80’s, in lithium-ion battery manufacturing U.S. companies and U.S. workers are starting out 10 years behind our economic competitors and strategic rivals.  We need to catch up, and we need to catch up quick.

I will reserve my thoughts on how we can catch up and win in the competition for lithium battery technology for the general discussion.  Thanks for your attention.