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KORE Power to Borrow $850M From US Department of Energy for Battery Factory
KOREPlex Expected to Produce 6 GWh of Battery Energy Per Year
Lithium ion battery company KORE Power Inc. said Friday it intends to borrow $850 million from the U.S. Department of Energy to help finance construction of a 1.3 million-square-foot advanced battery cell factory in Buckeye, Ariz.
The “KOREPlex” is expected to produce 6 gigawatt-hours of battery energy per year — enough to power 28,000 electric vehicles and replace 11.8 million gallons of gasoline.
The factory would produce batteries for EVs and energy storage systems. KORE will make two different battery cells at the operation. One will use nickel manganese cobalt and the other will use lithium iron phosphate. The latter does not require the use of cobalt, and as a result, may help reduce reliance on foreign materials and supply chains.
KORE’s loan with the program is conditional and has not closed yet, two energy department officials familiar with the discussions told Automotive News. They were not authorized to speak publicly about the pending application.
KORE Power Takes Advantage of Advanced Technology Vehicles Manufacturing Loan Program
The company plans to tap the Department of Energy’s Advanced Technology Vehicles Manufacturing loan program, which expanded with the passage of the Inflation Reduction Act in 2022. The program now offers $412 billion in low-interest loans to companies onshoring the manufacture of fuel-efficient vehicles and their components.
The program helped establish electric automakers Tesla and Fisker Automotive. Traditional carmakers like Ford and Nissan have also borrowed from the federal program to finance the build-out of facilities producing fuel-efficient vehicles. In July 2022, the program made a $102 million loan, its first in 11 years, to Syrah Technologies to expand a Louisiana facility that produces graphite-based active anodes, a key material needed to make lithium ion batteries for EVs.
Headquartered in Coeur d’Alene, Idaho, KORE said it raised $75 million of an expected $150 million in a funding round in November 2022. Siemens Financial Services and Quanta Services led the round. Other investors included Nidec Motor Corp., Honeywell Ventures and Trog Hawley Capital.
“With this loan from the Department of Energy’s Loan Programs Office, Americans move closer to driving vehicles with batteries made in the USA, and KORE remains on track to bring jobs to over 1,000 Arizonans manufacturing those batteries,” Lindsay Gorrill, KORE founder and CEO, said in an emailed statement to Automotive News.
KORE is onshoring battery manufacturing technology from Chinese battery maker DFD to the new Arizona facility, the energy department official said.
“That IP agreement is one-directional,” the official said. “So you’ve got the Chinese bringing their manufacturing expertise to Arizona, but no further IP that’s created in Buckeye will go back to China.”
Implications for KORE Power and the EV Industry
KORE’s customers for the batteries and energy storage are expected to be medium- and heavy-duty vehicle manufacturers and makers of specialty and construction vehicles.
The company may not be a household name in the EV realm, but KORE’s work and new facility are important to efforts to localize the supply chain and expand its U.S. base. This kind of “early-stage project,” the official said, helps enable the country’s ability to ramp production later.
The KOREPlex also aligns with the Biden administration’s Justice40 Initiative, which calls for 40 percent of the overall benefits of certain federal investments, including loan programs, to be directed to Department of Energy-identified disadvantaged communities. KORE plans to work with local community colleges and Native American tribes to hire and train a local workforce for operational jobs.