Redwood Materials Raises $1B To Boost Its US Battery Recycling Efforts

Redwood Materials, the battery recycling startup founded by Tesla co-founder and current board member JB Straubel, has raised more than $1 billion in Series D shares from its most recent equity funding round.

The round was co-led by Goldman Sachs Asset Management, Capricorn’s Technology Impact Fund, as well as funds and accounts advised by T. Rowe Price Associates. New investors, including OMERS, Caterpillar Venture Capital, Microsoft’s Climate Innovation Fund, and Deepwater Asset Management, also participated in the round.

Redwood Materials said it will use the funds, which are in addition to the nearly $1 billion of previously raised equity capital and a $2 billion loan commitment from the Department of Energy, to continue building its capacity, expanding the domestic battery supply chain, and allow its customers to purchase battery materials – like lithium, nickel and cobalt – made in the US for the first time.

Most battery materials are sourced or produced in China, which processes and refines 59 percent and 75 percent of the world’s lithium and cobalt, respectively. In comparison, the US and Canada combined process and refine just 3 percent of the world’s lithium and 3.5 percent of the world’s cobalt, according to data from Benchmark Minerals cited by TechCrunch.

To help reduce the gap and create a closed-loop supply chain in the US, Redwood has two factories under construction in the US. There’s a 175-acre recycling facility in Carson City, Nevada, which will produce anode copper foil, and a 600-acre facility in Charleston, South Carolina that will allow Redwood to go beyond recycling batteries and refining materials into remanufacturing of both the cathode and anode copper foil.

Redwood Materials Battery Materials Campus in Charleston, South Carolina

Currently, the US exports several hundred thousand tons of copper a year to Asia, which is not helping the environment and leads to critical copper supplies leaving the country.

The latest round of capital will help Redwood get its copper foil production in place by the end of 2023, with Panasonic set to be its first foil customer as part of an existing partnership – Redwood started recycling Panasonic’s manufacturing scrap from Tesla’s Giga Nevada plant in 2019.

“We are relentlessly focused on expanding our collection of end-of-life batteries, increasing our refining capability to recover higher quantities, and harnessing their value to make the most sustainable products. This approach stands as the cornerstone of our strategy as we scale our battery material production capacity.”

Excerpt from Redwood Materials’ press release

The company also said the additional capital will allow it to continue to assemble an industry-leading team to ensure “top-notch execution in sustainable battery materials production.”

Redwood Materials expects to reach around 100 gigawatt-hours annual capacity of cathode active materials and anode foil by 2025 – enough to power 1 million EVs. By 2030, it hopes to scale production output to 500 GWh per year, which could power 5 million EVs.