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AUTOMAKERS WIN EXTENSION ON USE OF CHINESE GRAPHITE IN EV TAX CREDITS

NEWS Desk Global



The U.S. Treasury Department announced on Friday that it would provide automakers with more flexibility regarding the requirements for battery minerals essential for electric vehicle (EV) tax credits, particularly concerning trace minerals like graphite sourced from China. Automakers will now have until 2027 to eliminate certain hard-to-trace minerals, including graphite found in anode materials, as well as critical minerals present in electrolyte salts, binders, and additives.

This decision comes after new regulations came into effect on January 1, which restricted the use of Chinese content in batteries eligible for EV tax credits of up to $7,500. These restrictions significantly reduced the number of vehicles eligible for the tax credit. However, automakers have since adjusted their supply chains, leading to restored eligibility for many vehicles. In response to ongoing challenges in sourcing these minerals, the Treasury has granted a temporary exemption for graphite and other trace critical minerals from the strict rules that prohibit materials from countries categorized as Foreign Entities of Concern (FEOC). This includes countries such as North Korea, Russia, and Iran.

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