The U.S. Department of Energy (DOE) said Wednesday it’s putting up $1 billion to boost mining, processing, and manufacturing technologies across critical minerals and materials supply chains in the U.S.
The funding initiative follows the executive order President Trump made on his first day back in office in January called “Unleashing American Energy” that seeks to accelerate domestic manufacturing of energy sources.
“For too long, the United States has relied on foreign actors to supply and process the critical materials that are essential to modern life and our national security,” U.S. Secretary of Energy Chris Wright said in a statement.
He added that the DOE “will play a leading role in reshoring the processing of critical materials and expanding our domestic supply of these indispensable resources.”
The agency said it will roll out funding opportunity notices in the coming months for the critical sectors it aims to support.
Five key funding initiatives in the works
As part of the funding initiative, the Advanced Materials and Manufacturing Technologies Office will release a NOFO of up to $50 million early this fall through the Critical Minerals and Materials (CMM) Accelerator program.
The CMM Accelerator was set up to promote the maturation of technology that can unlock capital investments and facilitate domestic commercialization.
The $50 million in funding will target several areas, including the rare-earth magnet supply chain, as well as processes to refine and alloy gallium, gallium nitride, germanium, and silicon carbide for use in semiconductors.
There will also be about $250 million that will be issued by the Office of Fossil Energy and Carbon Management to provide financial assistance for American industrial facilities that are working on producing mineral byproducts from existing industrial processes.
And the Office of Manufacturing and Energy Supply Chains (MESC) will issue a NOFO of up to $135 million to enhance domestic supply chains for rare earth elements (REEs).
The DOE is seeking to reduce America’s dependence on foreign sources of REEs “by demonstrating the commercial viability of methods for domestically refining and recovering REEs from mine tailings, deleterious material, and waste streams,” the agency said.
There will also be a $500 million investment to expand U.S. critical mineral and materials processing and derivative battery manufacturing and recycling and another $40 million spent on recovering critical materials from industrial wastewater.
The government’s $1 billion in funding could be a boon to U.S.-based mining stocks, including MP Materials (MP) and USA Rare Earth Inc. (USAR).
MP Materials has especially emerged as a major player in the Trump administration’s push to accelerate manufacturing of rare earths and other materials as part of its trade war with China.
The company has secured a $400 million investment from the Department of Defense, making the DoD its largest shareholder, and has also entered into a long-term $500 million contract with Apple (AAPL).
China is responsible for about 90% of the world’s rare earth manufacturing, which has pushed the U.S. to counter this imbalance by accelerating the production at home.
Shares of MP Materials have surged 383.3% this year, while USA Rare Earth has gained 48%.
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