A top U.S. Department of Energy official Friday checked out the Chattanooga battery materials factory Novonix, where the Biden administration has funneled a recent grant and tax credits totaling $203 million.
Deputy Secretary of Energy David M. Turk said all the synthetic graphite Novonix plans to make in Chattanooga is now imported from China. Synthetic graphite is used in electric vehicle batteries and other goods.
"Graphite is coming from China. That makes me nervous. These investments are allowing us to diversify our supply chain," he said at the Riverfront Parkway factory where Novonix employs about 100 people now readying for 2025 production.
(READ MORE: Novonix plant inaugurated)
While the growth of electric vehicle sales are slowing in America, Turk said in an interview that market penetration is at about 11% and has quadrupled since President Joe Biden took office in 2021.
"There's now more models out there. As we're able to reduce costs, there's more pick up on it," he said.
The funding for Novonix came from the Inflation Reduction Act and Bipartisan Infrastructure Law earlier passed by Congress. The provisions are enabling such investments in manufacturing nationally and helping create a clean energy supply chain, according to Turk.
U.S. Rep. Chuck Fleischmann, R-Southeast Tennessee, told a group of about 30 local officials that companies such as Novonix are reversing reliance on China.
"It is cutting edge. It is working," he said at the plant. "We can rebuild our industrial base."
Fleischmann said there's no question the nation is divided in many ways, "but when it comes to facilities like this, our future is bright."
Darcy MacDougald, Novonix' chief operating officer, said the company is using "revolutionary technology" for the planned first large-scale production of high-quality synthetic graphite in North America in 2025.
He said Novonix aims to employ 300 people at the $160 million former Alstom factory at The Bend that it inaugurated in late 2021.
"We're trying to do big things here," MacDougald said at the plant.
He said in an interview Novonix is working with federal officials about a potential loan program on its next phase, which is a second plant but on a greenfield site.
"We'll be looking to cut and paste," quipped the company COO.
The company hasn't finalized a location for that possible facility, but MacDougald said Chattanooga is "an amazing place to operate and we've got great support."
A Department of Energy document earlier identified Chattanooga as a future home for a proposed $1 billion Novonix plant as the company sought grant money from the federal government.
The company ultimately decided late last year to use that $100 million toward the build out of production at the Riverfront Parkway facility, but a greenfield facility is still in company plans.
Earlier this spring, Novonix won a $103 million federal tax credit to support its Riverfront Parkway production plant.
(READ MORE: Novonix wins tax credit)
Charles Wood, the Chattanooga Area Chamber of Commerce's chief executive, said in an interview he's excited Novonix is continuing to move forward.
He cited a recent agreement for Novonix to supply Panasonic Energy with battery materials for use in that company's U.S. plants from 2025 to 2028.
Panasonic Energy is working to expand its production of EV batteries in North America to meet increased demand.
Turk said the nation is building out the EV charging infrastructure to curb range anxiety.
He said new tariffs the U.S. has put on synthetic graphite from China are a tool to protect the country.
"Tariffs are to make sure we have a level playing field," Turk said. "Trade policy is an absolute critical tool in our tool belt."
Contact Mike Pare at [email protected] or 423-757-6318.
Staff photo by Olivia Ross / U.S. Deputy Secretary of Energy David Turk speaks Friday to an audience at Chattanooga's Novonix plant. 
