§17012 Advanced Battery Loan Guarantee Program

Summary

The Secretary must set up a program to guarantee private loans for building factories in the United States that make advanced vehicle batteries and related systems, including advanced lithium‑ion batteries, hybrid electrical parts, and software. The Secretary can only guarantee a loan if the borrower cannot get reasonable credit otherwise, the borrower looks able to repay and offers good security, and the loan’s interest rate is judged reasonable compared to similar U.S. debt. The Secretary will favor projects that have required permits, are likely to succeed, and serve areas with the greatest need. Guaranteed loans may not be longer than 20 years. Loan terms cannot be changed without the Secretary’s agreement. Borrowers must provide repayment backing equal to at least 20 percent of the loan (for example, a bond, insurance, or collateral) and must pay a fee to cover the Secretary’s costs. The U.S. government backs these guarantees, and a guarantee is final and cannot be contested by a loan holder. The Secretary must report to Congress each year until each guaranteed loan is repaid. Congress may appropriate whatever sums are needed to run the program. The Secretary’s power to make guarantees ends 10 years after December 19, 2007 (December 19, 2017).