This Story About American Battery Tech Going to China Shows the Costs of Outsourcing and Immigration
Why bother stealing the technology when they can just get us to give it away?
The idea for this vanadium redox battery began in the basement of a government lab, three hours southwest of Seattle, called Pacific Northwest National Laboratory. It was 2006, and more than two dozen scientists began to suspect that a special mix of acid and electrolyte could hold unusual amounts of energy without degrading. They turned out to be right.
It took six years and more than 15 million taxpayer dollars for the scientists to uncover what they believed was the perfect vanadium battery recipe. Others had made similar batteries with vanadium, but this mix was twice as powerful and did not appear to degrade the way cellphone batteries or even car batteries do. The researchers found the batteries capable of charging and recharging for as long as 30 years.
Instead of the batteries becoming the next great American success story, the warehouse is now shuttered and empty. All the employees who worked there were laid off. And more than 5,200 miles away, a Chinese company is hard at work making the batteries in Dalian, China.
The Chinese company didn't steal this technology. It was given to them — by the U.S. Department of Energy. First in 2017, as part of a sublicense, and later, in 2021, as part of a license transfer. An investigation by NPR and the Northwest News Network found the federal agency allowed the technology and jobs to move overseas, violating its own licensing rules while failing to intervene on behalf of U.S. workers in multiple instances.
Now maybe the battery tech is being overhyped. But the DOE violated its own rules and then appeared to be determined to move the tech to China. Why?
Department of Energy officials declined NPR's request for an interview to explain how the technology that cost U.S. taxpayers millions of dollars ended up in China. After NPR sent department officials written questions outlining the timeline of events, the federal agency terminated the license with the Chinese company, Dalian Rongke Power Co. Ltd.
"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."
The department is now conducting an internal review of the licensing of vanadium battery technology and whether this license — and others — have violated U.S. manufacturing requirements, the statement said.
Forever Energy, a Bellevue, Wash., based company, is one of several U.S. companies that have been trying to get a license from the Department of Energy to make the batteries. Joanne Skievaski, Forever Energy's chief financial officer, has been trying to get hold of a license for more than a year and called the department's decision to allow foreign manufacturing "mind boggling."
Not mind-boggling. When companies want an advantage, they get an inside track. And they had one.
Gary Yang, the lead scientist on the project, said he was excited to see if he could make the batteries outside the lab. The lab encourages scientists to do just that, in an effort to bring critical new technology into the marketplace. The lab and the U.S. government still hold the patents, because U.S. taxpayers paid for the research.
In 2012, Yang applied to the Department of Energy for a license to manufacture and sell the batteries.
The agency issued the license, and Yang launched UniEnergy Technologies. He hired engineers and researchers. But he soon ran into trouble. He said he couldn't persuade any U.S. investors to come aboard.
He said a fellow scientist connected him with a Chinese businessman named Yanhui Liu and a company called Dalian Rongke Power Co. Ltd., along with its parent company, and he jumped at the chance to have them invest and even help manufacture the batteries.
At first, UniEnergy Technologies did the bulk of the battery assembly in the warehouse. But over the course of the next few years, more and more of the manufacturing and assembling began to shift to Rongke Power, Chris Howard said. In 2017, Yang formalized the relationship and granted Dalian Rongke Power Co. Ltd. an official sublicense, allowing the company to make the batteries in China.
Then in 2019, Howard said, UniEnergy Technologies officials gathered all the engineers in a meeting room. He said supervisors told them they would have to work in China at Rongke Power Co. for four months at a time.
Yang acknowledges that he wanted his U.S. engineers to work in China. But he says it was because he thought Rongke Power could help teach them critical skills.
Yang was born in China but is a U.S. citizen and got his Ph.D. at the University of Connecticut. He said he wanted to manufacture the entire battery in the U.S., but that the U.S. does not have the supply chain he required. He said China is more advanced when it comes to manufacturing and engineering utility-scale batteries.
This is just one piece of a very large puzzle. It's how the PRC is robbing us blind.
Where the Trump administration attempted to push back, the Biden administration has shut down those efforts. Meanwhile, we're bleeding from both immigration and outsourcing, both of which are on display here, with an immigrant scientist cannibalizing taxpayer-funded work to export it back to China.
Still, she says it will be difficult for any American company at this point to catch up. Industry trade reports currently list Dalian Rongke Power Co. Ltd. as the top manufacturer of vanadium redox flow batteries worldwide. Skievaski also worries about whether China will stop making the batteries once an American company is granted the right to start making them.
That may be unlikely. Chinese news reports say the country is about to bring online one of the largest battery farms the world has ever seen. The reports say the entire farm is made up of vanadium redux flow batteries.
Once China got its hands on the tech, it was all over.