“There’s no software company in the world that can actually meet that regulation.”
(Sean Rayford/Getty Images)
The White House touted President Joe Biden’s “Invest in America Agenda” this week, but the administration’s tough environmental regulations are forcing major companies to reconsider investing in the U.S., which could strengthen domestic supply chains. It warns that
The Biden administration’s Environmental Protection Agency plans to issue a final rule “in the coming weeks” on a proposed ban on the commercial and industrial use of methylene chloride, a chemical currently used by technology companies involved in the production of electric vehicle battery separators. It was announced that it would be made public.
The expected crackdown follows the Biden administration’s Environmental Protection Agency’s November 2022 revised risk assessment, which concluded that methylene chloride falls under the Toxic Substances Control Act and poses an unreasonable risk of health harm. In April 2023, the agency followed up on this decision with a proposal to ban methylene chloride from consumer and “most industrial” uses. Multiple global companies involved in key parts of the battery manufacturing supply chain claim this will prevent them from entering the world. US market. The companies argue that the regulations are too burdensome and unachievable, forcing them to reconsider previously planned investments in the United States.
“There’s no software company in the world that can actually meet that regulation,” said Paul Chan, communications director for Japan-based W-SCOPE. washington free beacon. “We still need to analyze how the new regulations will impact our business from a long-term strategic perspective and how it will complicate our future investments in the U.S. We are currently considering investing in Canada or Mexico. We need to be 100% operational in North America by 2029, and those are our only options at the moment.”
This week, the White House launched an “Investing in America Tour,” during which Biden, Vice President Kamala Harris, their spouses and senior White House officials will spend three weeks promoting their cause. He plans to visit more than 20 states. The Biden administration’s commitment to domestic investment and strengthening the resilience of the American economy. In a memo announcing the trip, the White House said President Biden’s economic policies have, among other things, “strengthened supply chains here at home.”
However, several international companies involved in the production of electric vehicle battery separators, a critical component of the U.S. domestic battery supply chain, have written to the EPA stating that planned regulations on methylene chloride will force them to reconsider. I was informed that there was. Investment in the United States is also planned. SK IE Technology, a South Korean-based company that plans to enter the North American market in the next few years, said in a letter to the EPA that the proposed ban “could discourage U.S. investment.” He said he believed it was a “gate problem.”
“The use of methylene chloride (MC) is essential to the separator manufacturing process needed to successfully meet the EV and clean energy challenges. This would threaten domestic production capacity,” the company said in the letter. The South Korean company also asked for clarification on how the agency plans to classify methylene chloride’s industrial and commercial uses, asking for “MC to be used safely and to produce high-quality EV battery separators in the United States.” It is proposed to adopt an alternative classification method that can be used sustainably. state. ”
Polypore International, another international battery separator manufacturer, similarly requested that EPA amend the parameters of the proposed final rule. “Without reliable access to lithium battery technology, the United States has no hope of achieving the administration’s clean energy goals,” a letter from Polipore to the agency said. “With this in mind, we urge EPA to completely reconsider the proposed rule regarding methylene chloride and instead modify the existing mechanism…as appropriate based on appropriate science-based exposure thresholds. and implement solutions to ensure continued use of methylene chloride in the United States.” Use it safely and responsibly in the United States. ”
EPA maintained that it has worked closely with stakeholders throughout the rulemaking process. “EPA plans to finalize a risk management rule for methylene chloride in the coming weeks,” the agency said. Free beacon. “EPA cannot say at this time exactly what the provisions of the final rule will be, but any changes from the proposed rule will be informed through public comment.”
In addition to the proposed ban on methylene chloride, Chen also said that the upcoming presidential election and the loophole being exploited by China, which is designated as a Foreign Company of Concern by the United States, will also prevent W-SCOPE from enforcing the ban. He said that these are the factors he is looking at in deciding whether to do so. Previously planned investments in the United States. “We need to see clearer guidelines on whether U.S. regulators intend to completely block parts and suppliers from China or close loopholes,” Chen said. free becon. “That’s our second biggest concern at this point.”
