DOE Offers $730 Million Loan Commitment for Michigan Steel Plant
July 20, 2011
Vehicles like the Ford Focus Electric, slated to go on sale in late 2011, gain extra fuel efficiency by using lighter-weight, high-strength steel.
DOE announced on July 13 the offer of a $730 million conditional loan commitment to modernize a high-strength steel factory in Dearborn, Michigan. The funding will support the modernization of Severstal Dearborn, LLC's existing facilities in addition to the construction of new facilities to produce the next generation of automotive steel. The Severstal project has the potential to significantly increase the supply of the steel needed to spur the growth of fuel-efficient vehicles. Severstal estimates the project will generate more than 2,500 construction jobs and more than 260 permanent manufacturing jobs.
The facilities will produce a wide range of advanced high-strength steels, which will enable manufacturers to reduce the weight of steel used in vehicles, cutting vehicle weight by 10%. The project could reduce the consumption of petroleum-based fuels by nearly 30 million gallons per year, avoiding annual emissions of more than 260,000 metric tons of carbon dioxide. DOE's loans, loan guarantees, and conditional commitments for loan guarantees have totaled more than $40 billion in support of 42 U.S. clean energy projects, including more than $9 billion for manufacturers of advanced technology vehicles. See the DOE press release.