Battery recycler to receive $2B energy loan from feds
Redwood Materials, created by ex-Tesla co-founder, begins copper foils production
America's battery supply chain is getting a jump start.
Redwood Materials, created by Tesla co-founder J.B. Straubel, said Thursday that it received a $2 billion loan commitment from the Biden administration to build enough critical battery components to produce a million electric vehicles a year.
The loan is the fourth commitment in six months from the Department of Energy's Advanced Technology Vehicle Manufacturing loan program — the same fund that helped Tesla develop its flagship Model S electric sedan in 2010. Biden resuscitated the program in July after a 12-year hiatus, and Democrats nearly quadrupled its lending authority to $55 billion with the climate law passed in August.
It's a big day for Redwood, which also announced it has begun production of a key product: Thin copper foil used for battery anode. Redwood now operates the first major production line for the delicate foils in the U.S., Straubel said. Redwood will expand into complex cathode materials later this year.
“This is a super exciting moment,” Straubel said. “It is the very tangible beginning of a U.S. supply chain for battery materials and we'll be ramping that up for quite a long time to come.”
Secretary of Energy Jennifer Granholm was scheduled to visit Redwood's Sparks, Nevada, manufacturing facility Thursday to announce the loan, her first stop following Biden's state of the union speech that touted the administration's investments in clean energy.
Building a U.S. battery belt
Every EV battery has two electrodes — a cathode and an anode — between which trillions of charged lithium atoms travel. The cathode is the biggest factor in a battery's performance, cost and environmental footprint and the material today is produced almost entirely in Asia. Redwood plans to make cathode precursor, a preliminary solution of refined metals, later this year, and finished cathode material beginning in 2024.
Redwood's initial anode production will go to Panasonic's Nevada battery factory and the first customer for its future cathode materials will be a new battery plant that Panasonic is building in Kansas City, Kansas.
Straubel left Tesla in 2019 in order to address the gap between demand for electric vehicles and the availability of materials needed to make them. Redwood quickly became the biggest lithium-ion battery recycler in the U.S. before branching out into anode and cathode production in Nevada. The new loan will help create 3,400 construction jobs and 1,600 full-time employees, with hiring already underway, according to Straubel.
The Nevada hub is quickly being followed by a second plant Redwood is building in Charleston, South Carolina, which was announced in December. The $3.5 billion South Carolina facility will supply America's rapidly expanding battery belt, which stretches roughly from Michigan to Georgia. Thursday's loan announcement is to fund production in Nevada only.
Across its facilities, Redwood plans to produce enough materials for a million EVs a year by roughly 2025 and 5 million EVs a year by 2030, Straubel said.