SAFE: Exit Strategy Needed for Dependence on Chinese Graphite Supply

Washington, D.C.—In response to the U.S. Department of the Treasury releasing the final rule on FEOC provisions for the Section 30D clean vehicle tax credit, including a 2 year exemption for graphite, Abigail Hunter, Executive Director of SAFE’s Center for Critical Minerals Strategy issued the following statement:

“The administration is trapped by time as it strives to meet EV deployment commitments within the life of 30D, while simultaneously securing the complex mineral supply chains that make up EV batteries.

The administration has taken assertive steps through incentives, grants, and loans to support higher-integrity mineral supplies free of adversarial influence—but timelines on commercialization of these projects lag the urgency of near-term EV deployment goals.

Creating a temporary exemption for graphite sourcing is a reflection of this tightrope. SAFE sees electrification of transportation as a U.S. national security imperative. While recognizing the need for measures to expedite EV deployment, FEOC exemptions for any battery materials should be temporary: We need a clear exit strategy, lest we continue our dependencies on adversaries and further undermine the competitiveness of U.S. and allied critical minerals projects.”

SAFE urges U.S. regulators to send strong signals that this transition rule will be temporary. Simultaneously, the U.S. and other allied governments must continue supporting various domestic and allied graphite projects currently underway and ensure that they come online in a timely manner to provide viable alternatives to Chinese graphite for battery and auto manufacturers. Furthermore, greater action can be taken on improving traceability for many minerals, including graphite, which is why we endorse measures including the TRACE Act to improve transparency in mineral supply chains. Actions we take now will determine the future viability of resilient and secure global graphite supply.

At present, China accounts for 100% of all commercial-scale natural graphite processing. China has identified graphite as a geopolitical tool and imposed export restrictions in October 2023 due to the significance of this battery material.

About SAFE’sCenter for Critical Minerals Strategy (CCMS)
The Ambassador Alfred Hoffman, Jr. Center for Critical Minerals Strategy aims to secure all aspects of the critical minerals supply chain to help ensure the national and economic security of the United States and our allies as we transition from a fossil fuel based economy to a minerals based economy. CCMS is the sole NGO partner for private sector engagement to the State Department through the MINVEST project. The Center is also home to the Sub-Committee on Opportunities and Risks in the Critical Mineral Sector (SCOR) project with Appian Capital.

About SAFE
SAFE is an action-oriented, nonpartisan organization committed to transportation and energypolicy solutions that advance the economic and national security of the United States, its partners, and allies. SAFE has convened business and former military leaders since 2004 to advocate for secure,resilient, and sustainable energy solutions. Visit to learn more.