Entek wins $1.2 billion in federal funding for Indiana battery separator plant

Entek Lithium Separators L.L.C. received a conditional commitment for a direct loan of up to $1.2 billion from the U.S. Department of Energy to finance its new facility in Terre Haute, Ind., to manufacture lithium-ion battery separators, primarily for electric vehicles.

The $1.5 billion project will strengthen and onshore the lithium-ion battery cell supply chain and help advance EV propulsion, according to Entek officials.

"There has never been a more exciting time to be a manufacturer in the battery industry," CEO Larry Keith said in a news release. "For forty years, Entek has been serving the battery separator needs of its customers with a commitment to productivity and innovation that our customers require for their battery applications."

Entek had a groundbreaking in 2023 for the Terre Haute lithium separator factory, which will support roughly 1.9 million mid-size EVs or 1.3 million eSUVs based on current form factors chosen by cell manufacturers.

The Terre Haute site will employ 635 workers by the end of 2027 and create an estimated 763 temporary construction jobs.

Entek plans to attract workers who have been displaced from other manufacturing industries to move into clean-energy jobs as well as recruit through partnerships with Ivy Tech Community College, Indiana State University, local work force boards and work force systems, community-based organizations and apprenticeship readiness programs.

Entek is the only U.S.-owned and U.S.-based producer of wet-process lithium-ion battery separator materials.

A lithium-ion battery separator forms a microporous membrane barrier between the positive and negative electrodes of a lithium-ion battery. The separator prevents short circuits while allowing the transfer of electrons to power vehicles, devices and energy storage systems.

Entek's wet process makes the polymer film using a proprietary solvent.

The company produces ceramic-coated and uncoated separators, which play an important role in the performance and safety of lithium-ion batteries.

"Entek is a technology company at its core with expertise in equipment design and fabrication, process technologies, and materials science," Entek Chief Technology Officer Richard Pekala said. "This combination makes Entek the right company to lead the U.S. expansion of separator manufacturing."

The Terre Haute project is expected to make a significant contribution to domestic separator capacity and help U.S. EV battery manufacturers satisfy the Inflation Reduction Act's domestic content rules under the 30D Clean Vehicle Credit.

Entek also will be able to sell its separators to manufacturers of lithium-ion batteries for energy storage applications. The company is a contracted supplier to Kore Power.

"Kore Power proactively partnered with Entek to ensure a reliable, domestic supply of battery separators for our Arizona giga factory, the KorePlex," said Lindsay Gorrill, founder and CEO of Kore Power. "As a U.S. manufacturer, we are dedicated to bolstering the success of companies like Entek to onshore our critical battery component supply chain."

In 2022, Entek was selected for a $1.2 billion grant from the federal Bipartisan Infrastructure Law to support development of two battery film production plants by Entek International, which is part of Entek Manufacturing.

The conditional commitment indicates the DOE's intent to finance the project if Entek satisfies technical, legal, environmental and financial conditions. Then, the department will move forward with definitive financing documents and fund the loan.

The location for the second site hasn't been announced yet. At a press briefing in 2023, Keith indicated that Terre Haute and a site in Alabama were likely locations.

Entek, based in Lebanon, Ore., also manufactures extruders and material handling equipment for the production of battery separators and other so-called non-Entek applications.