The Department of Energy will no longer award a $200 million grant to an energy firm linked to the Chinese government, Fox News reports.

The administration informed congressional staff on May 22, 2023, during an evening call, in which DOE officials said that Texas-based Microvast won’t receive the large grant that was originally designated for the company in the 2021 infrastructure package.

Microvast, a company that develops lithium-ion battery technology, has been accused by Republicans of having “deep ties” to China. Republicans wrote a letter to Energy Secretary Jennifer Granholm in December 2022 expressing their concern about the government’s ability to “protect U.S. taxpayer dollars.”

“Americans deserve to know why their taxpayer dollars are being used to fund companies, like Microvast, with deep ties to China,” said Republican Rep. Cathy McMorris Rodgers. “Nothing is off the table. We have a lot of questions for the Biden administration.”

In March 2023, however, Granholm touted China’s renewable energy programs, saying that “the amount of money that they’re investing in clean energy is actually, you know, encouraging.” Granholm added that “China was by far the leading country for attracting energy transition investment,” before doubling down on her statements in a congressional hearing just days later.

Fox News said that while Microvast was incorporated in Stafford, Texas, in 2006, it also simultaneously incorporated Microvast Power Systems, a subsidiary firm, in Huzhou, China. Microvast currently lists an office location in Huzhou, Zhejiang, China, on its support page.

Just 3% of the company’s revenue was generated in the United States and 69% in China, according to a third-quarter financial disclosure it filed with the Securities and Exchange Commission, according to Fox News. The company allegedly acknowledged in the same filing that the Chinese government “exerts substantial influence” over its business activities and “may intervene at any time and with no notice.”

“As responsible stewards of American taxpayer dollars, the Department of Energy maintains a rigorous review process prior to the release of any awarded funds, and it is not uncommon for entities selected to participate in award negotiations under a DOE competitive funding opportunity to not ultimately receive an award,” a DOE spokesperson told Fox News.

“The Department can confirm that it has elected to cancel negotiations and not to award Microvast funds from this competitive funding opportunity,” the statement added.

The spokesperson did not specify why the negotiations were canceled.

Microvast did not respond to request for comment.

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