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Graphite in EV Batteries Creates Conundrum Under US Climate Bill

Aug. 16, 2022, 5:59 PM

Graphite is a key part of today’s electric vehicle batteries. It’s also tricky for Americans eyeing a tax break for buying climate-friendly cars.

EVs can qualify for a $7,500 tax credit under President Joe Biden’s climate and tax bill, as long as their batteries contain minerals extracted from or processed in a country with a free trade agreement with the US, and providing part of the components are made or assembled in North America. The measure, under the Inflation Reduction Act, kicks in next year, and content requirements get stricter after 2024.

Graphite, which is mostly produced in China, may cause issues.

“The material ...