This is so significant, it requires it's own thread.
By David Shepardson and David LawderWASHINGTON (Reuters) – The Biden administration on Friday issued-long awaited guidance that will limit Chinese content in batteries eligible for electric vehicle tax credits starting next year.
In a win for automakers, the U.S. Treasury will temporarily exempt some trace critical minerals from new strict rules barring materials from China and other countries deemed a “Foreign Entity of Concern.” (FEOC)
The new rules, required under an August 2022 law, are designed to wean the U.S. electric vehicle battery chain away from China and are being closely watched by automakers as they make investment decisions on producing batteries for their transition to electric vehicles.
The FEOC rules come into effect in 2024 for completed batteries and 2025 for critical minerals used to produce them.
Off the back of this draft legislation, the spot carb index in China will be potentially rendered irrelevant. Arcadium will have a new pricing index based on access to the American high ESG supply chains IMO. BMI is establishing a new ESG rated battery grade index.
Not Advice
