The U.S. Department of Energy’s Loan Programs Office has given conditional commitment to a $2.5 billion loan to Ultium Cells LLC to help finance construction of electric-vehicle battery-cell factories in Lordstown, Michigan and Tennessee.

At full capacity, the three plants are expected to create 6,000 construction jobs and 5,100 operations jobs, including upward of 1,100 operations jobs at the factory in Lordstown, where production is expected to start in less than three weeks.

Ultium Cells is a joint venture between General Motors and South Korea’s LG Energy Solution to mass produce lithium-ion battery cells for electric vehicles.

The $2.3 billion Lordstown plant was the first built. Under construction now is a facility in Spring Hill, Tenn., and a third has been announced for Lansing, Mich. A fourth plant is planned, but its location hasn’t been announced.

The commitment is through the department of energy’s Advanced Technology Vehicles Manufacturing program, which supports domestic manufacturing of light-duty vehicles, qualifying components and materials that improve fuel economy.

According to a blog post Monday by Jigar Shah, director of the loan programs office, the loan to Ultium Cells would be the first for a battery-cell manufacturing project under ATVM.

“LPO’s conditional commitment to Ultium Cells is the latest proof point of the department’s ongoing efforts to help build a domestic supply chain to meet the growing demand for electric vehicles,” Shah said. “These new manufacturing facilities will create thousands of good-paying jobs across three states while enabling improvements in existing lithium-ion battery technologies.”

While conditional commitment demonstrates the department of energy’s intent to finance the project, several steps remain, and certain conditions must be satisfied before the issuance of a final loan, the blog states.

Conditional commitment is the fifth of sixth steps in the application process. It represents a term sheet offer by the department of energy to the borrower or loan guarantee subject to satisfying certain conditions.

The final step is closing and project monitoring.

Charisma L. Troiano, department of energy press secretary, said because each deal is unique, each has a unique set of conditions before closing that are considered confidential. Timing of closing depends on the pace of executing those conditions.

The Loan Programs Office has $17.7 billion in loan authority to support manufacturing of eligible light-duty vehicles and qualifying components. So far, the program has loaned $8 billion for projects that have supported the production of more than 4 million advanced technology vehicles, its website states.

ATVM started under the Obama administration with $25 billion and has loaned Ford $5.9 billion in 2009 for factory upgrades, $465 million to Tesla Motors in 2010 to ramp up a plant in California and $1.45 billion to Nissan North America the same year to retool a factory in Tennessee. Nissan and Tesla have repaid the loans.

rselak@tribtoday.com