US battery recycler Redwood Materials has completed a Series E financing round worth $350 million. Redwood intends to use the new capital primarily to build more second-life energy storage facilities, but also to expand its refinery and materials production.
The financing round was led by Eclipse and also attracted new strategic investors. One example is NVentures, the venture capital arm of Nvidia. Redwood states that it wants nothing less than to help shape the next era of American energy leadership and independence in critical minerals. While e-mobility in the US is being slowed down under President Trump, Redwood emphasises its commitment to ‘the availability of electrical energy,’ which ‘has become a key strategic factor for the growth of AI infrastructure.’
The US battery recycler therefore no longer lists the recovery of critical materials such as cobalt, nickel, copper, lithium and cathode material as its core business areas, but now also includes grid energy storage. “This is a pivotal time for both Redwood and the United States, as curtailment in international supplies overlaps with intense domestic demand growth for these same materials and energy products,” outlines the management team led by CEO and former Tesla top manager JB Straubel.
Redwood has added the domestic construction of low-cost, large-scale battery storage facilities for use in AI factories to its business purpose. “Beyond powering data centers, this storage capacity will benefit industrial electrification and help address the intermittency of domestic renewable generation. Coupled with natural gas turbines and future nuclear generation, large scale energy storage can dramatically improve efficiency, utilization, and the reliability of those baseload assets,” according to an accompanying statement.
The American battery recycler had already announced in the summer that it also wanted to use used batteries in storage systems. And it immediately presented a well-known partner: General Motors. In July, both sides signed a memorandum of understanding to deploy stationary energy storage systems that use both new GM batteries manufactured in the US and end-of-life battery packs from GM electric vehicles.
At the end of June, Redwood Materials also introduced Redwood Energy, its own subsidiary for second-life battery storage. Redwood itself is considered the market leader in battery recycling in North America and has established the necessary structures there to collect not only production rejects but also used batteries from partners, such as GM’s battery joint venture, Ultium Cells. However, many of the batteries collected through the Redwood system are still in good condition – too good to be recycled directly. With Redwood Energy, the recycler wants to make further use of these good batteries and use them in the aforementioned second-life storage systems.
Incidentally, when the new subsidiary was unveiled in June, Redwood had already presented a storage facility with 12 MW of power and 63 MWh of capacity, which was built in Nevada at a modular data centre belonging to the AI infrastructure company Crusoe. As General Motors and Redwood confirm, the battery packs for this second-life storage facility come from GM vehicles. However, no further specific projects have been announced yet.
“Electricity demand is accelerating at an unprecedented pace, driven by AI and the rapid electrification of everything from transportation to industry,” JB Straubel said in the summer. “Both GM’s second-life EV batteries and new batteries can be deployed in Redwood’s energy storage systems, delivering fast, flexible power solutions and strengthening America’s energy and manufacturing independence.”
redwoodmaterials.com
