By Stuart Iler and Ashna Aggarwal of Greenline Insights for C2ES
The U.S. Southeast is at a pivotal moment in the race to build a domestic battery supply chain. Five key states – Alabama, Georgia, North Carolina, South Carolina, and Tennessee – have emerged as national leaders in battery manufacturing. But as investment accelerates, and as federal policy grows more uncertain, state and local decisions are becoming more consequential. Where new facilities land, how quickly they build, and whether they scale successfully will shape whether the region captures the full economic opportunity of the battery sector.
To better understand what drives these investments, Greenline Insights partnered with C2ES to survey industry participants across the supply chain. The survey findings offer an early signal of what industry is prioritizing, and where strategic action can make the greatest difference. The message for policymakers and economic development leaders was clear: the local regulatory environment can make or break a project.
Regulatory Conditions and Policy Signals Matter Most
The regulatory and operating environment ranked highest overall across more than a dozen siting factors, grouped into labor, site characteristics, supply chain considerations, regulatory and operating environment, and government incentives. This category included zoning and ordinances, permitting requirements, and community support. On average, these factors outranked nearly every other consideration.
That finding is significant. Although large incentive packages often dominate public discussion, companies signaled that predictability and speed are just as critical. Federal permitting for new projects can often take years, while unclear or unpredictable review processes, alongside the potential for community opposition, can also affect project timelines. All of which increase capital costs and overall investment risk, leading to delays for announced projects as well as discouraging other projects from being proposed.
State and federal financial incentives also ranked near the top. Notably, many respondents rated state incentives equally or more important than federal support. In a shifting federal policy environment, state-level strategy remains a decisive lever for attracting and retaining investment. The results underscore a consistent theme: battery manufacturing is capital-intensive and timeline-sensitive.
Companies prioritize environments that reduce uncertainty and enable execution.
Workforce, Land, and Energy Drive Site Decisions
Beyond the broader policy landscape, three factors consistently rose to the top.
Access to a skilled workforce emerged as one of the most important considerations across battery supply chain segments. Beyond production workers, companies require engineers and technicians capable of maintaining quality and efficiency. While labor cost ranked highly, workforce availability and skill depth were stronger drivers of siting decisions.
Battery facilities are large and capital-intensive, often requiring millions of square feet of operational space and room for expansion. As a result, land availability and affordability ranked among the top site-level considerations. Ready-to-develop industrial sites with clear zoning and supporting infrastructure can significantly strengthen a region’s competitive position.
Battery production is energy-intensive, making reliable and affordable electricity a core requirement. Importantly, companies’ concerns extend beyond price alone. Energy availability includes grid capacity, interconnection timelines, and certainty around utility processes. These factors have become increasingly salient as interconnection queues grow nationwide. Delays in securing sufficient power can slow construction and increase financial risk. Transportation and logistics infrastructure, as well as water and wastewater utilities, also ranked highly, reinforcing the importance of comprehensive site readiness.
Responses regarding proximity to suppliers and customers were mixed. However, several respondents noted that clustering across supply chain segments can reduce logistics costs and strengthen coordination over time. Partnerships with colleges and universities were also cited as valuable for workforce development and technical collaboration.
These findings suggest that while proximity alone may not determine siting decisions, broader ecosystem development can enhance long-term competitiveness.
Timing and Execution Risk
Battery manufacturing projects typically take several years to move from site selection to construction and full production ramp-up. Respondents identified multiple factors that can disrupt that timeline, including internal capital allocation decisions, permitting approvals, equipment delivery delays, construction material availability, and tariff-related cost uncertainty.
Several downstream manufacturers specifically cited delays in overseas equipment shipments and rising input costs as potential risks. The broader message is clear: execution risk is real, and regions that minimize friction will be better positioned to capture sustained investment.
What This Means for the Southeast
The survey results show that siting a battery manufacturing facility is a complex decision shaped by local governance, state policy, workforce systems, infrastructure readiness, and supply chain dynamics. For the Southeast, the opportunity to anchor more of the battery supply chain remains substantial. Realizing it will depend on creating an enabling environment that pairs competitive financial support with efficient regulatory processes, strong workforce pipelines, and coordinated regional strategy. State policies to facilitate these will be key, as will federal policies that stabilize the landscape and provide more long-term certainty.
