American taxpayers might soon bankroll a whopping $7.5 billion loan to StarPlus Energy, a joint venture involving automaker Chrysler (via Stellantis) and Samsung SDI. Why? To power up two lithium-ion battery plants in Kokomo, Indiana, about 50 miles from Indianapolis.
On Monday, the Department of Energy’s Loan Program Office dropped the news that StarPlus Energy has snagged a “conditional commitment” for the funds. Translation: If all the paperwork checks out, the feds will cut a multi-billion-dollar check to boost electric vehicle (EV) production.
Indiana is already throwing serious cash at this project, with the Indiana Economic Development Corp. pledging hundreds of millions in state tax credits and incentives. Guess they’re really trying to put “revving up the economy” on the map.
Plans for the Kokomo battery bonanza started in May 2022, with a second plant added to the roster in October 2023. The Energy Department claims the project will generate 3,200 construction jobs and another 2,800 factory jobs. Oh, and those batteries? They’re expected to power about 670,000 EVs annually—because Kokomo is the new Silicon Valley of lithium-ion.
Stellantis plans to use the batteries in its U.S. vehicles, a win for its marketing team. Meanwhile, the loan comes with no credit spread and an interest rate matching current U.S. Treasury rates.
The Biden administration is framing this as part of its “Investing in America” agenda, touting the project as a leap toward reshoring manufacturing and reducing dependence on overseas tech. It’s also the second big Indiana project to score federal funds—last month, ENTEK received $1.3 billion to construct a lithium-ion battery separator factory in Terre Haute.
Before StarPlus gets its hands on the money, it must tick a few boxes, like creating a Community Benefits Plan and adhering to the Justice40 Initiative, which channels 40% of the benefits to underserved and pollution-plagued communities.
