Redwood Materials, the battery recycling startup founded by former Tesla co-founder JB Straubel, will recycle waste from the production of batteries for General Motors’ electric vehicles.
The company announced Thursday that it is working with Ultium Cells, the battery manufacturing joint venture between GM and LG Energy Solution, to recycle cathodes, anodes and waste cells from their facilities in Warren, Ohio and Spring Hill, Tennessee.
Battery recycling is a growing industry as automakers and battery manufacturers seek to control their supply of battery materials, rather than relying on China, the world leader in this field. In the United States and regions like Europe, incentives are mounting for recycled and domestically produced critical battery materials, such as lithium, nickel, cobalt, manganese and graphite.
President Joe Biden’s Inflation Reduction Act, signed in August 2022, provides a tax credit for battery manufacturing and critical mineral processing. Redwood directly benefited from the passage of this bill in February 2023, when the Department of Energy gave the startup a $2 billion loan to build its battery recycling facility in Nevada. The DOE also provided Ultium Cells with a $2.5 billion loan to expand its cell manufacturing facilities in the United States.
The road to actually recycling electric vehicle batteries is long, as most of these batteries are produced today and will not reach the end of their life for many years. This is why agreements like this with Ultium to recycle waste are so important. Redwood – which also has deals with Toyota and Panasonic (which produces batteries for Tesla), has already become a well-known name in electric vehicle battery recycling, but any startup in this space needs a short-term strategy term to stay on the long track. profits.
And producing scrap metal is no easy feat. A Redwood spokesperson told TechCrunch that the average battery factory generates 5 to 10 percent scrap, meaning Redwood handles about 10,000 tons of material per year, the equivalent of truckloads of scrap metal every day.
Redwood will recycle Ultium’s waste and process it into high-quality battery materials, which will then be returned to cell manufacturers in the form of domestically produced anode and cathode components, the company said.
Processing materials – not just recycling them – is also part of Redwood’s long-term strategy, as the price of materials fluctuates regularly. The big money will come from processing the materials, which today are typically sent to Asia for processing and then sent back to the United States.
In August 2023, Redwood raised $1 billion to expand its battery recycling facilities, as part of its goal to increase its production capacity for anodic copper foil and cathode active materials. The company said at the time that it planned to produce about 100 gigawatt hours of annual capacity of cathode active materials and anode foils, capable of powering 1 million electric vehicles, by 2025. By 2030, Redwood hopes that production will reach 500 GWh per year. , which could power 5 million electric vehicles. The company has not confirmed whether this timeline is still accurate.
The two Ultium Cells facilities that will supply scrap metal to Redwood each represent 2.8 million square foot operations that are expected to produce more than 80 GWh of battery cells combined per year, and Redwood says it will receive the majority of this scrap metal. In 2021, Ultium also partnered with Canadian battery recycling company Li-Cycle to recycle waste, but GM has not confirmed whether this deal is still in the works. Ultium is also building a third facility in Michigan. Redwood did not say whether it would also obtain waste from that plant.
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