In recent weeks, the Department of Energy has been reviewing and moving to terminate contracts worth several billion dollars. The agency has now officially announced the cancellation of $720 million in manufacturing grants.
These funding cuts impact firms involved in producing battery components, recycling lithium-ion batteries, and developing highly insulating window technologies.
Energy Secretary Chris Wright has been reviewing agreements established during the Biden administration. According to spokesperson Ben Dietderich, the DOE stated that these projects “failed to meet key milestones” and “did not sufficiently support the nation’s energy priorities,” as reported to E&E News.
Congress had approved all the grant funding through the Bipartisan Infrastructure Law enacted in 2021. Most of the awards were distributed in 2023 and 2024; in the past, the Trump administration cited grants issued between Election Day and Inauguration Day as grounds for rescinding awards.
The list includes three startups, each of which received grant selections well before the 2024 presidential race.
Ascend Elements has been developing a recycling process that transforms both manufacturing scrap and spent batteries into materials needed for domestic lithium-ion battery production. The company secured $316 million in October 2022 to help fund a $1 billion plant in Kentucky.
Federal records show that Ascend Elements has already received $206 million. The company stated it will continue its project by seeking alternative funding sources to cover any gaps.
Anovion was granted $117 million to bring back to the U.S. a technology for producing synthetic graphite used in lithium-ion battery anodes. Benchmark Mineral Intelligence reports that Chinese companies dominate 75% of the synthetic graphite supply chain and manufacture 97% of all synthetic graphite anodes. Anovion’s facility is planned for Alabama, but so far, only $13.8 million has been distributed, according to federal data.
LuxWall, another startup, produces windows that insulate buildings as effectively as solid walls, a significant innovation that could lower energy consumption and reduce utility costs. The DOE awarded LuxWall $31.7 million to construct a factory at a former coal plant site near Detroit. The grant was issued in November 2023, but government records indicate only $1 million has been paid out. LuxWall launched the first phase of its plant in August 2024.
TechCrunch previously covered the Department of Energy’s moves to revoke these and other contracts.
These grants were partly designed to help startups overcome the “valley of death”—a stage where many innovative companies struggle to move from research to commercial production. Building pioneering factories is often financially challenging for startups, but government grants like these can attract private investment. Once operational, such facilities can act as models for future manufacturing sites, strengthening the nation’s industrial sector.
