ASX lithium shares are charging higher today.
Drilling down to some of the biggest lithium stocks, the Lake Resources NL (ASX: LKE) share price is soaring 27.2%, shares in Core Lithium Ltd (ASX: CXO) have gained 9.3%; Allkem Ltd (ASX: AKE) shares are up 1.4%; and the Pilbara Minerals Ltd (ASX: PLS) share price is up 1.35%.
The big-name ASX lithium shares are handily beating the 0.2% gains posted by the All Ordinaries Index (ASX: XAO) at the same time.
So, what's going on?
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United States bill set to boost electric vehicle market
ASX lithium shares could be getting an extra boost today following the passage of a major spending bill in the US Senate addressing healthcare and climate change.
Of the roughly US$437 billion greenlighted by the Senate, some US$347 billion is earmarked for climate and energy spending.
It was a narrow victory for the White House-sponsored bill, with all 50 republicans voting against, tying the 50 democrats voting in favour. In the end, the bill passed 51 to 50 with a tiebreaking vote from Vice President Kamala Harris.
The House still needs to vote on the bill. But it's widely expected to sail through that process, with democrats holding a majority of seats. President Joe Biden, an advocate of the bill, will then need to sign it into law.
So, how could this development further energise ASX lithium shares in the future?
Atop the wider focus on emissions reduction, the bill ends per-manufacturer limits for the US$7,500 tax credit for new electric vehicles (EVs).
As Electrek reported, the EV credit will be renewed commencing January 2023 and run for 10 years.
Under the previous legislation, EV tax credits had a cap of 200,000 cars per manufacturer. Tesla Inc and General Motors Company had already exceeded that cap "years ago". Toyota Motor Corp exceeded the cap this quarter, with other EV manufacturers also looking to surpass that cap.
Importantly for ASX lithium shares, the bill includes language that stipulates "critical minerals" for the EV batteries must be sourced in the US, or from a nation with a free trade agreement with the US.
The US is eager to diversify its supply sources of critical battery minerals away from China, which has long dominated the industry.
How have these ASX lithium shares been tracking longer term?
Over the past 12 months, the Lake Resources share price has surged 98%.
The Core Lithium share price has performed even better, up 263% since this time last year.
Allkem is another ASX lithium share that has had a strong year, up 42%. The Pilbara Minerals share price is up 43%.
For some context, the All Ordinaries is down 7% over the 12 months.
