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Michigan Gets $1.35 Billion from DOE for Advanced Battery Development

Vice President Joe Biden recently announced that 12 Michigan projects have been awarded more than $1.35 billion in economic stimulus grants from the U.S. Department of Energy to support advanced battery and electric vehicle manufacturing and development.

Funding for the competitive grants comes from the American Recovery and Reinvestment Act. The projects are estimated to create 6,800 jobs in the next 18 months and up to 40,000 jobs by 2020.

Michigan Gov. Jennifer M. Granholm and Lt. Gov. John D. Cherry Jr. hailed the awarding of the alternative energy grants.

“Three years ago, we identified the advanced battery market as a key emerging sector that Michigan, already the global center of automotive research and development, was positioned to lead,” Granholm said. “We developed an aggressive strategy to make Michigan the advanced battery capital of the world, and today’s announcement is another huge step toward that goal.”

“Michigan is the leader among states in the advanced battery field, and it will help transform our economy,” Cherry said. “We are working to establish an entire advanced battery industry with manufacturers, suppliers, and the entire value chain located right here in Michigan, creating new economic activity and new jobs.”

Michigan saw the opportunity for an advanced battery industry early and developed an innovative strategy to bring to Michigan the jobs and economic development created by advanced battery research, development, and manufacturing.

That strategy includes Michigan’s first-in-the-nation advanced battery tax credits. Earlier this year, Granholm signed into law legislation providing up to $700 million in refundable tax credits to encourage companies to develop and manufacture advanced batteries and commercialize advanced battery technologies in Michigan. Michigan’s early commitment to this initiative was a key factor in Michigan projects receiving the DOE grants.

Beginning in February, the Michigan Economic Growth Authority (MEGA) approved battery incentive agreements with Ford, GM, and Chrysler totaling $280 million for pack engineering, integration and assembly, vehicle engineering, and advanced-battery technologies. In April, MEGA approved $400 million in refundable advanced battery tax credits for A123Systems, Johnson Controls-Saft Advanced Power Solutions, KD Advanced Battery Group, and LG Chem-Compact Power.

The state also is expanding its advanced automotive research outside of the metro Detroit area. For example, Mercedes-Benz is expected to hire more than 200 workers for a hybrid technologies research and development center that will be relocated from Troy, MI to Washentow County. The center will be the first major alternative propulsion technology operation in the Ann Arbor, MI region, which is steadily assembling a range of companies devoted to advanced batteries and electric-vehicle technology.

“In 2006, Michigan charted a course to lead in advanced battery development and we have not looked back,” MEDC President and CEO Greg Main said. “We engaged industry experts every step of the way and secured unprecedented bipartisan support for some of the most generous and innovative economic development tools in the nation. I commend Governor Granholm and the Michigan Legislature for enabling Michigan to be a global leader in this industry.”

Michigan Projects Receiving DOE Grants

Cell, Battery and Materials Manufacturing Facilities

• Johnson Controls—$299.2 million awarded for production of nickel-cobalt-metal battery cells and packs, as well as   production of battery separators for hybrid and electric vehicles. Facility located in Holland.
• A123 Systems—$249.1 million awarded for manufacturing nano-iron phosphate cathode powder and electrode coatings,   fabrication of battery cells and modules, and assembly of complete battery pack systems for hybrid and electric vehicles.   Facilities in Romulus and Brownstown.
• KD Advanced Battery Group—$161 million awarded for production of manganese oxide cathode/graphite lithium-ion   batteries for hybrid and electric vehicles.   Facility in Midland.
• Compact Power (on behalf of LG Chem)—$151.4 million awarded for production of lithium-ion polymer battery cells for   the GM Volt. Facilities in Holland, Pontiac, and St. Clair.
• General Motors—$105.9 million awarded for production of high-volume battery packs for the GM Volt. Facility located in   Brownstown Township.

Electric Drive Component Manufacturing Facilities

• General Motors—$105 million awarded for construction of U.S. manufacturing capabilities to produce the second-   generation GM global rear-wheel electric drive system. Facility in Wixom.
• Ford Motor Company—$62.7 million awarded to produce a Ford electric drive transaxle with integrated power electronics   in an existing Ford transmission facility. Facility located in Sterling Heights.
• Magna E-Car Systems of America—$40 million awarded to increase production capacity of advanced automotive electric   drive system component manufacturing plants located in the United States. Facility in Holly.

Advanced Vehicle Electrification

• Chrysler—$70 million awarded to develop, validate, and deploy 220 advanced plug-in hybrid-electric pickups and   minivans. Facility in Warren.
• South Coast Air Quality Management District—$45.4 million awarded to develop a fully integrated, production plug-in   hybrid system for Class 2-5 vehicles. Facility in Galesburg.

Advanced Vehicle Electrification/Transportation Sector Electrification

• General Motors—$30.5 million awarded to develop, analyze, and demonstrate hundreds of Chevrolet Volt Extended   Range Electric Vehicles.
• Ford Motor Company—$30 million to accelerate the launch and commercialization of PHEVs and EVs by partnering with   15 of America’s leading utilities.

Former Wixom Plant Becoming $725-Million Renewable Energy Park

Michigan is transforming the former Ford Wixom Assembly plant into a $725 million renewable energy park anchored by Xtreme Power and Clairvoyant Solar.

The project, which still requires approval of federal and state incentives, will provide up to 4,000 jobs on site.

“Michigan is fast becoming a North American hub for manufacturing renewable energy products,” Gov. Jennifer Granholm said. “Today we’re adding to our growing list of world-class green manufacturing leaders who want to establish operations here. Michigan is attractive to them because of our skilled workforce, technical know-how, and manufacturing capacity.”

At a celebration on the Wixom site, Ford Motor Company Executive Chairman Bill Ford Jr. announced plans to sell the former manufacturing facility to Xtreme Power and Clairvoyant Energy; they are creating a new partnership to redevelop the property. The two anchor manufacturers plan to begin production in the fall of 2011 and also expect to attract suppliers and other manufacturers to the site.

Xtreme Power says it will create 2,500 direct jobs, while Clairvoyant will create 270 direct jobs initially and projects employment to eventually reach 1,100. Oerlikon Solar, a Swiss-based manufacturing partner of Clairvoyant, plans to locate its North American headquarters at the site and create 300 jobs. An additional 10,000 supplier and indirect jobs are estimated to be created by this economic development.

The Granholm administration has been working hard to make Michigan a center for green manufacturing. Recently-created incentives and programs to support the growth of cutting-edge Michigan companies in this field include first-in-the-nation advanced-battery incentives, the 21st Century Jobs Fund, alternative energy and high-tech tax credits, renewable energy renaissance zones, anchor zone incentives, and Centers of Energy Excellence.

Last month, nine Michigan companies were awarded a total of more than $1.35 billion from the U.S. Department of Energy to support advanced-battery and electric-vehicle manufacturing and development.

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