Zinc8 Energy Solutions (CSE:ZAIR) has announced that the company's inaugural commercial production facility will be located in the United States.
The company said this is based upon comprehensive analysis done by it, the recently announced Inflation Reduction Act’s (IRA) manufacturing production credits contained within Section 45X provide distinct and the direct benefits to Zinc8 and its production plans in the US.
In a statement, Zinc8 Energy Solutions (CSE:ZAIR) CEO Ron MacDonald said: "Senate majority leader Chuck Schumer was instrumental in drafting the IRA, which is a historic measure taken by the United States to reach ambitious goals of carbon neutrality, while inspiring other countries around the world.”
READ: Zinc8 Energy Solutions ends second quarter with working capital balance of $4.5 million
In July 2022, Senator Schumer personally called MacDonald to urge the company to expand its operations in New York state and particularly to Ulster County.
"Zinc8 is the jolt of electricity the Hudson Valley needs, and is proof positive that when you invest in fighting climate change you are investing in creating good-paying jobs, new economic growth, and a brighter future for our communities," Senator Schumer commented in a press release.
The company said the support of the senator would play a major role in their decision of where to locate their first major production facility.
In addition, the company noted that Senator Schumer has worked to increase federal incentives to bring manufacturing back from overseas, including in tech and clean energy industries, and shepherded the IRA to passage in the Senate, the largest climate package to ever pass the chamber at US$369 billion, and fought to include targeted incentives to help clean battery companies like Zinc8 reach commercialization by expanding their manufacturing operations in the United States.
US President Joe Biden signed the IRA legislation into law on August 16, 2022.
Zinc8 Energy Solutions (CSE:ZAIR) makes a zinc-air battery that can store and discharge energy durations from four to 100 hours, scalability and higher capacity is achieved with an increase in the size of storage tanks that hold zinc particles. The technology will be trialled at a New York City housing complex by the New York State Energy Research and Development Agency (NYSERDA) where a 100kW/1.5MWh zinc BESS is combined with onsite CHP generation.
The Section 45X Advanced Manufacturing Tax Credit included in the IRA provides incentives to battery manufacturers as well as to critical mineral processing companies. Every eligible battery cell will receive a US$35 credit, scaling with the capacity of the battery, with incentives to last at their initial level until 2029, before phasing down from 2030 to a phase-out stage beginning in 2032.
Specific to Zinc8, eligible components include electrode active materials, battery cells and battery modules. Electrode active materials include cathode materials, anode materials, anode foils, and electrochemically active materials, including solvents, additives, and electrolyte salts that contribute to the electrochemical processes necessary for energy storage. With respect to the production of these materials, the US taxpayer producing these materials would be eligible for a credit amount of 10% of the costs incurred.
There is also US$10 billion in support available for construction of clean energy tech factories, or for retrofitting existing factories with tools and production lines to make clean energy equipment and components. Biden's Bipartisan Infrastructure Law includes US$6 billion in incentives to support research and development and production of batteries in the US as well as supporting the creation of a domestic supply chain.
This represents some direct and beneficial credit opportunities for Zinc8, said the company's CEO MacDonald.
"It is abundantly clear that with the introduction of the IRA, US policymakers, led by Senator Schumer, are taking real action by introducing incentives that benefit both the climate and the economy. We have received tremendous support both at the federal and state level as we continue to analyze possible sites for our first manufacturing facility," he added.
Zinc8 specializes in flow battery technology that relies on regenerating zinc particles to store and dispatch energy. The company focuses on developing and commercializing its low-cost, long-duration ZESS for utilities, microgrid, and commercial and industrial markets.
Contact the author at susie@proactiveinvestors.com