Form Energy, the cutting-edge battery manufacturer bringing new life to the old Weirton steel plant property, could benefit from up to $150 million in federal dollars aimed at bolstering the United States energy grid.
In an online press conference, Senator Joe Manchin and Form chief executive Mateo Jaramillo said the federal dollars flowing to a private manufacturer represent an appropriate role for government to support the nation’s energy needs.
“I’ve always believed that government should be your partner. Government should never be your provider. If you’re intending on government to provide everything you need in the marketplace, that’s not who we are in a capitalist, entrepreneurial society,” Manchin said. “This is a good partnership.”
Jaramillo said support at all levels of government is a necessity for ambitious projects like the battery plant.
“I don’t know what the role of government should be, but I do know that the government is required to do big projects and to take on big initiatives like this,” Jaramillo said in response to a MetroNews question about the intersection of government and the private sector.
The money aimed at supporting Form Energy is part of a broader set of federal dollar distributions aimed at bolstering the electric vehicle and grid battery supply chain.
The funding is part of the more than $6 billion included in the Bipartisan Infrastructure Law that Congress passed in 2021. The grant is through the U.S. Department of Energy’s Battery Materials Processing and Battery Manufacturing and Recycling program. Representatives of the government agency noted that the federal dollars will be matched by millions of dollars in private capital.
“This program is critical to improving our energy security, and Form Energy is a prime example of how we approach that,” said Giulia Siccardo, director of the Department of Energy’s Office of Manufacturing & Energy Supply Chains, participating in the press conference with Manchin.
“Through Form’s 100-hour energy system that will help us improve grid strength and resiliency by allowing us to harness intermittent power from solar and wind and turn that into stable sources of power for our energy system, they’re also tackling energy security in another way. They’re doing it with abundant resources that we have in our country, helping reduce our dependence on foreign imports.”
Form Energy’s initial phase on the site of the old Weirton steel mill in Hancock County is meant to produce 750 well-paying jobs. Form’s leaders say this government support will allow the company to more quickly reach a hiring level of 600 workers — on the way to the ultimate level of 750.
Weirton’s city manager, Mike Adams, expressed optimism that Form Energy will be a catalyst for the area’s revitalization.
“Our community was built on the foundation of Weirton Steel in the early 1900s, and long before the term ‘community benefits plan’ existed, Weirton Steel had one in action. We are excited to see Form Energy reigniting that spirit as an active partner with the City of Weirton. The hope and good jobs they’ve brought aren’t just beneficial for Form Energy but are creating new interest and commerce in our city and across the entire region,” Adams said.
Form’s customers are electric utilities, looking to harness battery storage capacity. The company’s battery technology operates through a “reversible rusting” process. The battery breathes in oxygen from the air and converts iron metal to rust. When the battery charges, the reverse happens. An electrical current converts the rust back to iron, and the battery breathes out oxygen.
Manchin said the project represents a shift in American priorities. He described the United States focusing on a world market at the time the North American Free Trade Agreement was passed, resulting in a shift away from domestic manufacturing.
“And in doing so, we lost our edge. We’ve got to get our edge back, especially the building blocks,” he said. “If we can’t produce our own energy, if we can’t be energy independent and you’ve got to be reliant on foreign supply chains for our energy, you’re going to be jeopardizing whether you can maintain superpower status.”
Manchin said the current federal support will give companies a jump start and the market shares necessary to continue. Then, he said, they will be on their own.
“This kind of money will not be injected. Never in my lifetime will I see that type of investment that we’ve made,” Manchin said.
The iron-air battery manufacturing plant is financed by millions of dollars of private investments. Jaramillo said the developers have raised $900 million of equity capital to date.
“So this is an accelerant here. This is not first money in, the first capital into the company. It really is helping to drive it even faster because of the progress we’ve already made and the private equity we’ve already brought into the company,” Jaramillo said.
Among Form Energy’s financial backers is Breakthrough Energy Ventures, which includes billionaire investors like Bill Gates, Jeff Bezos and Richard Branson. Gates has touted the company’s work “creating a new class of batteries that would provide long-duration storage at a lower cost than lithium ion batteries.”
State Delegate Pat McGeehan, R-Hancock, has been critical of the project and those involved. McGeehan has questioned whether the company has ties to foreign interests and he wrote a newspaper opinion piece with a headline referring to the project as a “woke Trojan horse.” He objects to Form’s values, including its green energy focus and its diversity, equity and inclusion policies.
“The worst thing is if they’re successful on their own terms. The best outcome would be if they fail because that is just government typically doing what is common because that is just government wasting money,” McGeehan said in a telephone conversation.
He accused the company of embracing a “radical climate change ideology” that “undermines the very spirit of what we call West Virginia. We should reject them outright and defend our people and our state.
“They were invited into this state by politicians eager for headlines. They push dangerous ideas in stark contrast to the traditional values West Virginians hold dear,” McGeehan said.
McGeehan followed up later with a written statement to expand on his view. He said:
“Our people deserve leaders who are committed to the preservation of their values, values that have long defined West Virginia. Pushing these so-called ‘green energy’ startups, producing batteries for solar and wind power, are not terrible policies simply because of the government subsidies involved, but because of the radical ideology that those who run this company bring with them. These are not simply ‘more jobs.’ They become a Trojan horse for a poisonous worldview that can threaten our communities. The owners of this new company were invited into our state by politicians eager for headlines, and they represent the worst of modern liberal-progressive thought. These forms of startup companies from the east and west coasts push perverted ideas that stand in stark contrast to the traditional values West Virginians hold dear. These include ‘non-binary’ and transsexual gender theories, which aim to confuse our children and upend our traditions, while radical climate change ideology reduces men and women to some sort of parasite upon the world. Their ideology also promotes ‘pride’ ideology that is inconsistent with our deeply held beliefs about family and community. This startup business is about the tired platitude of creating jobs. It’s really about importing a corrosive set of values that will undermine the spirit of West Virginia. Far from subsidizing these efforts, we should reject them outright and defend our state from those who would seek to corrupt it in the name of progress. West Virginia has always stood strong in its traditions, and we ought to be more vigilant about protecting the traditions our ancestors handed down to us.”
Another lawmaker, state Senator Mike Stuart, posted on social media to question whether West Virginia experiences regional disparities when it comes to government financial support for economic development projects.
“So many handouts and federal/state funding for so many parts of WV but where is the help for Lincoln, Logan, Boone and southern Kanawha counties?” posted Stuart, R-Kanawha.
Millions of public dollars are going toward the project in Weirton.
The West Virginia Economic Development Authority voted to allocate $75 million toward the purchase of land and the construction of buildings in Weirton. Another $215 million in allocations by the Legislature went toward supporting the project.
The deal with the state means West Virginia will own the building and land, and Form Energy will lease it back. Much of the public money was to go toward infrastructure preparation. Form is responsible for the equipment and material inside the building. The property would transfer to Form no sooner than five years and only if the company employs 750 workers. The deal calls for workers making at least $63,000 a year in average salary.
The project is also eligible for tax breaks through the Inflation Reduction Act that was steered by Manchin, who is chairman of the Senate Energy Committee.
“We wrote it for basically bringing manufacturing back to the U.S. and as we transition. We’re producing more fossil, cleaner than anywhere in the world. We’re also investing more and producing more battery storage and solar than ever before in our country and we’re investing in cleaner technologies. So we’re producing the energy we need today, and investing in energy we’d like to have for tomorrow,” Manchin said.
And now the project is in line for $150 million from the Bipartisan Infrastructure Law.
Jaramillo said the two sources of government support — the Bipartisan Infrastructure Law and the Inflation Reduction Act — are complementary.
“For example, Form, as a fully domestic manufacturer using overwhelmingly domestic materials and supply chains enables our customers to qualify for an adder on the investment tax credit — so the domestic content adder for power projects, energy projects that are produced in the United States,” Jaramillo said.
“So there’s an extra 10% of investment tax credit that our customers get to tap into because we’re making batteries right here in West Virginia, which obviously is in the United States.”
Form Energy is rapidly taking shape. Earlier this month, the company celebrated completion of construction and start of trial production in Weirton. Jaramillo said the company already has a backlog representing 18 months of orders to electric utilities.
“There’s no doubt that these batteries are going out into the world, and we still need to deliver that,” Jaramillo said.
“We’ll start our first customer deliveries at the end of this year, not next year or the year after — no more waiting, this is it. This has been a windup.”