Tucked between two huge buildings within the hills of the Nevada desert, 805 retired EV batteries lie in neat formation, each wrapped in nondescript white tarps — and hiding in plain sight.
A passerby may not notice this unassuming array is the biggest microgrid in North America, that it’s powering a 2,000 GPU modular information middle for AI infrastructure firm Crusoe, or that it represents the following massive act of JB Straubel, the co-founder and CEO of Redwood Supplies.
Redwood Supplies introduced Thursday throughout an occasion at its Sparks, Nevada facility that it was launching an vitality storage enterprise that may leverage the 1000’s of EV batteries it has collected as a part of its battery recycling enterprise to supply energy to firms, beginning with AI information facilities.
The brand new enterprise, known as Redwood Vitality, is kicking off with companion Crusoe, a startup Straubel invested in 2021. The previous EVs, which aren’t but prepared for recycling, retailer vitality generated from an adjoining photo voltaic array. The system, which generates 12 MW of energy and has 63 MWh of capability, sends energy to a modular information middle constructed by Crusoe, the AI infrastructure firm finest identified for its large-scale information middle campus in Abilene, Texas — the preliminary web site of the Stargate challenge.
The size of Redwood’s battery assortment operation is staggering. Redwood stated it recovers greater than 70% of all used or discarded battery packs in North America. At present, it processes greater than 20 GWh of batteries yearly—the equal of 250,000 EVs. It has apparently been stockpiling batteries that aren’t prepared for recycling, with greater than 1 gigawatt-hour price in its stock already. Within the coming months, it expects to obtain one other 4 gigawatt-hours.
By 2028, the corporate stated it plans to deploy 20 gigawatt-hours of grid-scale storage, putting it on observe to change into the biggest repurposer of used EV battery packs.
Straubel’s confidence within the endeavor was obvious in each element of the launch occasion. As an instance the dedication of Redwood — and by extension, Straubel — all the pieces in regards to the manufacturing, from the lights and music to the projection on the massive display screen had been powered by the microgrid.
“We wished to go all in,” Straubel stated, breaking into a large, toothy smile. Splashy results for the occasion apart, the microgrid setup with Crusoe isn’t an illustration challenge. Straubel stated this can be a revenue-generating operation, which was constructed in 4 months, and one that’s worthwhile. He added that much more of those will likely be deployed with different prospects this 12 months.
“I feel this has the potential to develop sooner than the core recycling enterprise,” he stated.
Redwood Supplies has been on an enlargement tear in recent times. The corporate, which has raised $2 billion in non-public funds, was based in 2017 by Straubel, the previous Tesla CTO and present board member, to create a round provide chain.
The corporate began by recycling scrap from battery cell manufacturing in addition to shopper electronics like cellphone batteries and laptop computer computer systems. After processing these discarded items and extracting supplies like cobalt, nickel and lithium which can be sometimes mined, Redwood provides these again to Panasonic and different prospects. Over time, the corporate has expanded past recycling and into cathode manufacturing. Redwood generated $200 million in income in 2024, a lot of which comes from the sale of battery supplies like cathodes.
The corporate’s footprint has grown too, and effectively past its Carson Metropolis, Nevada headquarters. It has locked up offers with Toyota, Panasonic, and GM, began development on a South Carolina manufacturing unit, and made an acquisition in Europe.
Redwood Vitality is the following step — and one which isn’t tied to establishing its methods to be off-grid. The retired EV batteries will be powered by wind and photo voltaic, or they are often tied to the grid. Within the case of the Crusoe challenge, the system is powered by photo voltaic.
“There’s no inexperienced intent required right here,” CTO Colin Campbell stated throughout a tour of the microgrid. “It’s a great financial selection that additionally occurs to be carbon-free.”
The enterprise mannequin addresses a longstanding problem within the vitality storage sector. For over a decade, firms have been promising to construct grid-scale storage from used EV batteries, however they’ve solely materialized in small quantities. Redwood, which acquired its begin as a battery supplies and recycling firm, is creating a brand new line that guarantees to ship gigawatts of a lot wanted vitality storage in just some years.
“This actually demonstrates how economical the waste hierarchy truly is,” Jessica Dunn, a battery skilled on the Union of Involved Scientists, instructed TechCrunch. That a big recycler like Redwood acknowledged the revenue potential in repurposed EV batteries reveals “the place this end-of-life market will go,” she added.
Repurposing batteries is a transparent enterprise alternative for Redwood, however it may additionally be a enterprise crucial. Redwood was based to construct a provide chain that might deal with the anticipated wave of used EV batteries that may hit the market. However that wave hasn’t materialized fairly as shortly as some predicted.
“If Redwood didn’t enter the repurposing market, then they wouldn’t get a share from the repurposed battery. They’d have to attend the 5, 10, 15 years till they retired,” she stated. Within the meantime, different firms would have the ability to promote the batteries for grid-scale storage, chopping Redwood out of years of income.
Straubel acknowledged this, noting in an interview that in some ways Redwood Supplies began a bit early.
“We began actually early, and in a means we began Redwood nearly too early,” he stated, noting the corporate initially was accumulating shopper batteries and manufacturing scrap forward of the approaching wave of EVs.
The present state of the recycling market underscores the problem. “Proper now, the recycling market is generally manufacturing scrap, shopper electronics, and EV batteries which have failed underneath guarantee,” Dunn stated. That has been sufficient for Redwood to course of over 20 gigawatt-hours yearly. However it pales compared to the 350 gigawatt-hours in EVs at present and the 150 gigawatt-hours anticipated to hit the highway yearly.
Redwood at the moment has a recycling facility at its 175-acre campus in Sparks, Nevada, and it’s growing a 600-acre facility in Charleston, South Carolina. The latter will remanufacture cathode and anode copper foil, each of which include vital minerals that the U.S. would like stayed inside its borders.
The corporate beforehand stated that will probably be able to making 100 gigawatt-hours yearly of cathode energetic materials and anode foil by the top of this 12 months. By the top of the last decade, it expects manufacturing to hit 500 gigawatt-hours.
