Several American businesses, including Forever Energy of Bellevue, Washington, have been vying for the Department of Energy’s approval to manufacture the breakthrough batteries, but the US gave that battery technology to China.
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Ten years ago, a group of engineers and scientists realized they were on to something significant when they gathered in a warehouse in Mukilteo, Washington. They gathered tables and chairs from various places, made room for experiments in the parking lot, and then set to work.
They were constructing a vanadium redox flow battery in accordance with a blueprint made by two dozen American experts working in a government lab. The batteries could be used for decades, were about the size of a refrigerator, and contained enough energy to run a house. The engineers saw people setting them down next to their air conditioners, mounting solar panels on them, and leading happy, independent lives.
“It was beyond promise,” said Chris Howard, one of the engineers who worked there for a U.S. company called UniEnergy. “We were seeing it functioning as designed, as expected.”
However, the reality was different. The warehouse is now closed and abandoned; instead of the batteries being the next great American success story. There were no longer any employees there. A Chinese company is hard at work manufacturing the batteries in Dalian, China, which is more than 5,200 miles away.
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This technology wasn’t taken from the Chinese company. They received it as a gift from the US Department of Energy. Both in 2021 as part of a license transfer and initially in 2017, as part of a sublicense. According to a joint investigation by NPR and the Northwest News Network, the federal agency violated its own licensing guidelines by allowing the technology and employment to be outsourced while failing to step in on many occasions to protect American workers.
Now, China has advanced, pouring millions of dollars into the cutting-edge green technology that was meant to keep the United States and its economy in the lead.
The federal agency terminated the license with the Chinese company, Dalian Rongke Power Co. Ltd., after sending department officials written questions explaining the sequence of events.
“DOE takes America’s manufacturing obligations within its contracts extremely seriously,” the department said in a written statement. “If DOE determines that a contractor who owns a DOE-funded patent or downstream licensee is in violation of its U.S. manufacturing obligations, DOE will explore all legal remedies.”
Several U.S. companies have tried to get a license to make the batteries
According to the statement, the department is currently undertaking an internal assessment of the licensing of vanadium battery technology to determine whether this license, along with others, violated U.S. manufacturing standards.
Several American businesses, including Forever Energy of Bellevue, Washington, have been vying for the Department of Energy’s approval to manufacture the batteries. The chief financial officer of Forever Energy, Joanne Skievaski, has been attempting to obtain a license for more than a year and referred to the department’s decision to permit overseas manufacture as “mind boggling.”
“This is technology made from taxpayer dollars,” Skievaski said. “It was invented in a national lab. (Now) it’s deployed in China, and it’s held in China. To say it’s frustrating is an understatement.”
The concept for this vanadium redox battery first emerged in the basement of Pacific Northwest National Laboratory, a government laboratory three hours southeast of Seattle. In 2006, more than two dozen scientists started to have doubts about the ability of a unique combination of acid and electrolyte to store unusually high amounts of energy without deteriorating. They were shown to be accurate.
The scientists took six years and more than 15 million taxpayer dollars to develop what they thought was the ideal vanadium battery formula. Similar batteries had previously been created using vanadium, but this combination was twice as strong and didn’t seem to decay like cellphone or even car batteries do. The batteries were discovered by the researchers to be capable of charging and recharging for as long as 30 years.
The project’s lead researcher, Gary Yang, expressed excitement at the prospect of producing the batteries outside of the laboratory. The lab pushes scientists to do precisely that in order to bring critical new technology to market. Because U.S. taxpayers funded the study, the lab and the government of the United States still control the patents.
Yang submitted his application for a manufacturing and sales license for the batteries to the Department of Energy in 2012.
Yang started UniEnergy Technologies after receiving the license from the agency. He employed scientists and engineers. But he immediately encountered problems. He claimed he was unable to get any American investors.
In an interview, Yang stated, “I talked to almost all major investment banks; none of them (wanted to) invest in batteries.” The banks demanded a return on their investments more quickly than the batteries would generate a profit.
He said that another scientist had put him in touch with Chinese industrialist Yanhui Liu and the parent company of Dalian Rongke Power Co. Ltd. He seized the opportunity to secure their financial support and even enlist their assistance in the production of the batteries.
Initially, UniEnergy Technologies assembled the majority of the batteries in the warehouse. Chris Howard noted that over the course of the following few years, Rongke Power began to take over an increasing amount of the production and assembly. In order to enable the business to produce the batteries in China, Yang formally sublicensed Dalian Rongke Power Co. Ltd. in 2017.
Any company can decide to produce in China. But in this instance, the guidelines are rather obvious. According to Yang’s original license, he must sell a specific quantity of batteries in the United States, and those batteries must be “substantially manufactured” locally.
Yang admitted in an interview that he didn’t do it. Few batteries were sold by UniEnergy Technologies in the United States, but not enough to satisfy its needs. The ones it did sell were produced in China, including once to the American Navy. Yang, however, said that over the years, neither the lab nor the department had ever questioned him or brought up any concerns.
Then, according to Howard, in 2019, officials of UniEnergy Technologies assembled all the engineers in a meeting room. He claimed that managers informed them that they would have to spend four months at a time working in China for Rongke Power Co.
“It was unclear, certainly to myself and other engineers, what the plan was,” said Howard, who now works for Forever Energy.
Yang admits that he desired for his American engineers to work in China. But he claims that he did so because he believed Rongke Power could assist in teaching them important skills.
Yang earned his Ph.D. at the University of Connecticut despite being a Chinese citizen and having been born in China. He claimed that while he would have preferred to produce the entire battery here, the U.S. lacked the necessary supply chain. He claimed that when it comes to producing and engineering utility-scale batteries, China is more advanced.
“In this field — manufacturing, engineering — China is ahead of the U.S.,” Yang said. “Many wouldn’t believe [it].”
He said that he did not send his engineers and the battery to assist China abroad. He said that the engineers in that nation were supporting his UniEnergy Technologies workers and assisting him in building his batteries.
However, press reports at the time indicate that the actions benefited China. The Chinese government announced millions of dollars in funding for large-scale vanadium batteries and started a number of significant demonstration projects.
Yang was having more financial difficulties in the United States as battery work picked up in China. He consequently made a choice that would prevent the technology from remaining in the United States.
The EU has strict rules about where companies manufacture products
Yang gave the battery license to a Dutch-based European corporation in 2021. According to Roelof Platenkamp, the company’s founding partner, Vanadis Power initially intended to keep producing the batteries in China before opening a factory there and ultimately hoping to produce in the United States.
According to Platenkamp, the European Union has severe regulations on where businesses may manufacture their goods, therefore Vanadis Power has to produce batteries there.
“I have to be a European company, certainly a non-Chinese company, in Europe,” Platenkamp said in an interview with NPR.
But similar laws exist in the United States as well. To prevent manufacturing from moving abroad, the U.S. government must approve each transfer of a license. In recent years, the United States has lost a considerable number of jobs in industries where it first made headway, like solar panels, drones, and telecom equipment. Nevertheless, it appears that UniEnergy had no trouble obtaining approval when it asked for it.
On July 7, 2021, a government manager at the facility where the battery was developed received an email from a top UniEnergy Technologies official. According to several emails a UniEnergy executive claimed they were working out a contract with Vanadis and would transfer the license to them.
“We’re working to finalize a deal with Vanadis Power and believe they have the right blend of technical expertise,” the email from UniEnergy Technologies said. “Our transaction with Vanadis is ready to go pending your approval …”
In response, the government manager said he needed confirmation before transferring the license and sent an email to a second UniEnergy employee. After waiting an hour and a half for the second employee, Vanadis Power received the license.
It is unknown whether the manager or anyone else at the lab or Department of Energy thought to inquire whether Vanadis Power was an American company or whether it intended to manufacture in the U.S. during that hour and a half or after. According to Vanadis’ own website, the batteries would be produced in China.
Department representatives responded by saying they check each transfer for compliance and that new regulations put in place last summer by the Biden administration will plug gaps and keep more manufacturing in the country.
However, agency representatives admitted that because their reviews frequently depend on “good faith disclosures” from the corporations, the U.S. government might never know if firms like UniEnergy Technologies don’t come forward.
Government investigators said that issue has bedeviled the department for years.
The Department of Energy depended on outdated computer systems, didn’t have uniform procedures across all of its labs, and lacked the capacity to adequately oversee its licenses, according to a report (pdf below) released in 2018 by the Government Accountability Office.
In this instance, Forever Energy, an American company, contacted UniEnergy more than a year ago with questions over the license. Joanne Skievaski said that she and other company representatives frequently informed department representatives that the UniEnergy license did not meet requirements.
“How is it that the national lab did not require U.S. manufacturing?” Skievaski asked. “Not only is it a violation of the license, it’s a violation to our country.”
Skievaski expressed her hope that Forever Energy will be able to buy the license now that it has been cancelled by the Department of Energy or acquire a license that is similar to it. The company intends to start producing next year after establishing a factory there. She recoils at the notion that American engineers are incapable of meeting the challenge.
“That’s hogwash,” she said. “We are ready to go with this technology.”
She claims that despite this, it will be challenging for any American corporation to catch up at this stage. According to industry trade papers, Dalian Rongke Power Co. Ltd. is now the world’s leading producer of vanadium redox flow batteries. Skievaski is also concerned about the possibility that China would stop producing batteries once an American company is given the go-ahead to do so.
That might be impossible. According to Chinese news sources, one of the biggest battery farms the world has ever seen is set to go online. According to the reports, vanadium redox flow batteries make up the entire farm.
Read the report given below: