US Government to distribute $2 billion in grants for car battery research

  The White House plans to unveil the first group of grants from a $2 billion fund for battery research in the next few weeks with some of the funds directed to states like Michigan, a top economic adviser said tonight.As part of the $787 billion stimulus package approved in February, Congress agreed to include $2 billion in battery research grants. Unlike the $25 billion advanced vehicle retooling program, the grants for battery research do not have to be repaid.

Ed DeSeve, the president’s special adviser on the stimulus program, said an announcement on the first round of battery grants would happen shortly. But he declined to say what automakers, suppliers or battery companies might be receiving the grants.

“I think you’ll see over the next week or so … some industrialization focus for example on the battery grants that are coming,” DeSeve told regional reporters this evening during a roundtable meeting, noting that there are also Energy Department loan guarantees in the works. “It makes sense to put those in places where there is productive working capacity — people who can do the jobs — there are plants where the jobs can exist, and I think you are going to start to see more and more of that over time.”

General Motors Co., Ford Motor Co. and Chrysler Group LLC have all applied for battery grant funding, as have some other battery companies and suppliers.

In March, President Barack Obama renewed his campaign pledge to push for 1 million plug-in electric hybrid vehicles on U.S. roads by 2015, promoting a $2 billion battery research program, saying it “will spark the manufacturing of the batteries and parts that run these cars, build or upgrade the factories that will produce them, and in the process, create thousands of jobs right here in America.”

Michigan lawmakers pushed hard for the research money during the debate over the stimulus package, saying it was crucial to helping the auto industry develop next-generation plug-in electric hybrid vehicles.

Obama’s call for 1 million plug-in hybrids by 2015 was first made in a Lansing campaign speech last year. Auto manufacturers have said they worry the plan is too ambitious.

GM plans to begin production of its extended range electric vehicle, the Chevrolet Volt, late next year; Ford said in January it will bring a fully electric vehicle to market by 2011 and a plug-in hybrid in 2012. Chrysler will have produced 100 all-electric vehicles by year’s end, and in January said it plans to have four electric models on the road in 2013. The company says it expects to have 500,000 electric vehicles on the road in four years; Toyota Motor Corp. will have a test fleet of 150 plug-ins on U.S. roads by the end of this year.

The White House said in March the Department of Energy will offer $1.5 million in competitive grants to U.S. developers of advanced batteries, and $500 million for development of other components needed for plug-in hybrids, such as electric motors.

Another $400 million will be used to demonstrate the infrastructure needed to make such vehicles practical, such as plug-in stations for owners to recharge their cars.

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