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U.S. utility company Duke Energy will reportedly decommission industrial batteries manufactured by Chinese company CATL connected to a green energy project at Marine Corps Base Camp Lejeune in North Carolina.
The company also plans to phase out CATL products at its civilian projects after U.S. lawmakers raised national security concerns about CATL's ties to the Chinese government and hackers targeting critical U.S. infrastructure, including the power grid, Reuters reported.
"In partnership with policymakers and the Department of the Navy, we have made the decision to decommission the CATL battery energy storage system at Camp Lejeune and replace it with a domestic or allied nation supplier," Duke Energy said in a statement to Reuters.
"By 2027, we are voluntarily moving away from specifying CATL battery energy storage technologies," the statement said, adding that the company supports a "robust American supply chain."
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A sign at the entrance to U.S. Marine Corps Base Camp Lejeune, in eastern North Carolina, U.S., sits in this undated handout photo. Under pressure from Congress, U.S. utility company Duke Energy plans to decommission energy-storage batteries produced (U.S. Marine Corps/Handout via REUTERS/File Photo / Reuters Photos)
The decision comes after Duke Energy confirmed to Fox News Digital in December that it had temporarily disconnected CATL batteries at its solar panel array at Camp Lejuene in response to more than two dozen House and Senate Republicans who had called on the Defense Department to shut down the project and review whether CATL systems had been installed at other U.S. military bases.
Duke Energy sent at least five executives, including its chief security and information officer, to meet with staff of the House of Representatives' select committee on China and assuage lawmaker's concerns in the first week of January, Reuters reported, citing sources familiar.
At the meeting, the executives told staff they were confident in the security of CATL's batteries, but also expressed a desire to address lawmakers' concerns, the sources reportedly said.
The executives disclosed in the meeting that the company had been considering CATL batteries for about two dozen other projects, according to Reuters.
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Battery Energy Storage System leaders and U.S. Marine Corps Brig. Gen. Andrew M. Niebel, commanding general of Marine Corps Installations East (MICEAST)-Marine Corps Base (MCB) Camp Lejeune, cut a ribbon during a ceremony on Marine Corps Base Camp Le (U.S. Marine Corps/Lance Cpl. Loriann Dauscher/Handout via REUTERS/File Photo / Reuters Photos)
Rep. Mike Gallagher, R-Wisc., the chairman of the bipartisan select committee, and Sen. Marco Rubio, R-Fla., said in a statement to Reuters that they were pleased Duke Energy had moved to decommission the CATL batteries at Camp Lejeune.
"Additionally, in our most recent meeting with company leadership, Duke committed to entirely phasing out CATL products from its supply chain," the lawmakers said.
Gallagher and Rubio had previously led more than two dozen lawmakers in calling on Defense Secretary Lloyd Austin to cancel the Camp Lejeune project and review whether CATL systems had been installed at other U.S. military bases.
In a December letter, the lawmakers noted Fujian, China-based CATL is closely linked to the highest levels of the CCP, and Chinese President Xi Jinping even praised the company earlier this year. The letter cited a recent report published by the nonpartisan Foundation for Defense of Democracies (FDD), which raises the alarm on CATL's rapid expansion in the U.S. green energy market.
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Electric power transmission pylon miniatures and Duke Energy logo are seen in this illustration taken, December 9, 2022. (REUTERS/Dado Ruvic/Illustration/File Photo / Reuters Photos)
Although it is not state-owned, Chinese investors tied to the CCP have held financial stakes in CATL, according to a New York Times review. The Chinese government has also taken strategic steps over the last decade to bolster CATL and other electric vehicle companies based in China.
In addition, Zeng Yuqun, who founded CATL in 2012 and remains its top executive, was identified last year as a member of the Chinese People's Political Consultative Conference (CPPCC) National Committee. According to a U.S. government report published in 2018, the CPPCC is a "critical coordinating body" that brings together representatives of Chinese interest groups and is led by the CCP’s Politburo Standing Committee.
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In March 2022, the CPPCC highlighted Yuqun's work with CATL fortifying China's lithium supply chains, which are crucial for electric vehicle production and other green energy development.
U.S. automaker Ford Motor Company announced in September that it would pause construction of a $3.5 billion plant in Michigan that would have manufactured CATL battery cells using services provided by the CCP-linked company.
FOX Business' Thomas Catenacci and Reuters contributed to this report.