By Scott McClallen
(The Center Square) – Gov. Gretchen Whitmer joined Ford Motor Company to announce support for Ford’s new global battery center in Romulus, but some critics question if a Fortune 500 company needs taxpayer funding.
“Ford’s investment in battery research and development in Romulus will support hundreds of good-paying jobs, attract innovative talent to Michigan, and help us continue leading the world in advanced mobility and manufacturing,” Whitmer said in a statement issued Tuesday. “Ford is an American icon that has left its mark on the world over a century, and with the research that will take place at Ford Ion Park, they will shape the next century while reducing emissions and accelerating electrification.”
Ford proposed a $185-million battery research facility in Romulus for cell designs and optimize mining to recycling. It’ll staff 200 full-time engineers to work at the facility within 18 months of renovation completion.
The National Conference of State Legislatures estimates electric vehicles (EV) now number more than 1.2 million in the United States, and are predicted to rise to more than 18 million by 2030. Each electric vehicle has a large battery pack, typically lithium-ion, which will eventually die at an average of 200,000 miles, Consumer Reports estimates.
The presents a two-fold problem: Current EV batteries “are really not designed to be recycled,” materials scientist Dana Thompson, a research fellow at the United Kingdom-based battery research center Faraday Institution, told Science Mag.
Traditional car batteries can be recycled, but not lithium-ion versions used in electric cars.
Paul Anderson, the co-director of the Birmingham Centre for Strategic Elements and Critical Materials, told BBC that about 5% of lithium-ion batteries worldwide are recycled.
Moreover, ethical questions linger. The world’s top producers of lithium are South America, where Argentine and Chile provide 93% of U.S. lithium. A report from Amnesty International explores the thousands of child laborers who mine cobalt for lithium batteries. A Guardian report noted children as young as six work in the mines.
While they don’t guzzle gas, a single Tesla requires seven kilograms of lithium for its battery pack, which requires an energy-intensive extraction from the brine of salt flats that can damage the environment and cause water shortages, such as in Chile’s Atacama and Argentina’s Salar de Hombre Muerto regions, Ronald J. Deibert explains in his book “Reset: Reclaiming the Internet for a Civil Society.”
Problems persist with switching away from gas-powered engines. There aren’t many electric charging stations in certain parts of Michigan, chargers aren’t compatible with all vehicles, charging time varies, and gas is more energy efficient.
“Pound for pound, gasoline or diesel fuel contain about 40 times as much energy as a state-of-the-art battery,” Samantha Gross, the director of the Energy Security and Climate Initiative at the Brookings Institute, wrote.
The Michigan Strategic Fund approved a transfer of the existing Renaissance Zone to Ford for four years, handing what would be otherwise taxpayer money to another private company — something the Michigan Economic Development Company (MEDC) frequently does.
The MEDC hasn’t responded to a request for comment asking how much taxpayer money is funding Ford through the Renaissance Zone.
John Mozena, president of the Center for Economic Accountability, a nonprofit organization for transparent economic development policy, described the handout as “robbing Peter to pay Paul” because Ford already intended to build its battery plant in Michigan. The state just paid them taxpayer money to do something they already planned to do, Mozena told The Center Square.
The gift of a Renaissance zone means its “virtually tax free,” the MEDC explains. The business won’t pay:
- Michigan personal income tax (if a resident of the zone)
- Michigan’s 6-mill state education tax
- Local personal property tax
- Local real property tax
- Local income tax (if applicable)
“What is the state subsidy accomplishing other than maybe increasing Ford’s profits, which is great if you’re a Ford shareholder, but seems a bad idea from the standpoint of public policy?” Mozena asked in a phone interview.
“There’s a much better political argument for the subsidy than there is an economic argument,” he said.
