New law aims to keep cutting-edge technology made in America The Department of Energy allowed a taxpayer-funded breakthrough in batteries to transfer overseas with little oversight

Congress tightens U.S. manufacturing rules after battery technology ends up in China

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Last year we brought you a story about breakthrough battery technology that U.S. scientists developed in a government lab. It took six years and more than 15 million taxpayer dollars. An NPR investigation with the Northwest News Network found that the Department of Energy allowed that cutting-edge technology to transfer overseas to China with little oversight. And now, citing NPR's reporting, Congress passed a bill that aims to stop similar transfers in the future. NPR's Laura Sullivan brings us this update.

LAURA SULLIVAN, BYLINE: A little more than a decade ago, almost two dozen U.S. scientists working at the Pacific Northwest National Laboratory in Washington state discovered a new battery recipe using vanadium. Many thought it would change the way Americans powered their homes. But there's no factory making the batteries in the U.S. They're being made in China, where officials just brought online the world's largest battery farm using the American technology. NPR found that the Department of Energy, which oversees the lab, violated its own licensing rules and failed to intervene as a company making the batteries moved production overseas.

Senator Marco Rubio, a Florida Republican, criticized the department's actions, as did Senator Tammy Baldwin, a Democrat from Wisconsin, and Senator Rob Portman, a Republican from Ohio. Baldwin said she and Portman sponsored a new bill that tightens restrictions on sending government-sponsored technology abroad after hearing the story. The bill passed with wide support last month as part of the National Defense Authorization Act.

TAMMY BALDWIN: The Invent Here, Make Here Act is focused on making sure that when we invest American taxpayer dollars, that the breakthroughs actually end up getting manufactured here.

SULLIVAN: Baldwin says they focused the act on the Department of Homeland Security first to see what kind of response it would get. Now, she says, they intend to introduce legislation targeting the Department of Energy and additional federal agencies.

BALDWIN: So many of our legacy laws have huge loopholes. There's still a lot of additional action we can take.

SULLIVAN: After NPR's reporting, the Department of Energy revoked the license it had given to the battery company and opened an internal investigation. The department has not shared its findings publicly. In response to NPR's Freedom of Information Act request, officials sent 233 fully redacted pages and NPR's own emails. But according to the website E&E News, which obtained a copy of the report, investigators found the department and the lab failed to adequately monitor the license. It found that frequent staff turnover and inadequate recordkeeping prevented the lab from tracking the battery license as it was transferred to China, despite years of, quote, "noncompliance."

SCOTT PAUL: Even though there have been laws on the books for decades designed to ensure that those patents are utilized in the United States by American manufacturing, unfortunately, they've been widely ignored.

SULLIVAN: Scott Paul is the president of the Alliance for American Manufacturing. He says federal agencies are finally coming around to the idea of protecting U.S. taxpayer investments. For decades, the U.S. has lost out on producing some of its best discoveries, such as solar panels, drones, telecom equipment and semiconductors.

PAUL: I'm bullish on the prospects for manufacturing. But we do have to stop making these boneheaded, unforced errors like giving our technology away to companies that are simply going to manufacture it in China.

SULLIVAN: Energy officials did not respond to NPR's written questions. Department spokeswoman Charisma Troiano said only that she does not believe the law has anything to do with the Department of Energy. The department implemented stronger guidelines a year and a half ago which require American manufacturing. But Paul says the recent congressional legislation and possible new laws carry more weight.

PAUL: We've been on our heels for way too long. The policy momentum is with these efforts, and so it's good that lawmakers are responding.

SULLIVAN: Paul says he believes the bipartisan support for these laws in Congress could lead to new American factories in the next few years.

Laura Sullivan, NPR News, Washington.

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