Redwood Materials has received conditional commitment for a $2-billion loan from the DOE's Loan Program Office. Redwood will draw upon this milestone-based financing in tranches that support phased construction and allows the company to unlock funding as it accelerates the construction and expansion of its first battery materials campus.

Once fully operational, the project would be the first domestic facility to support production of anode copper foil and cathode active materials (CAM) in a fully closed-loop lithium-ion battery manufacturing process by recycling end-of-life battery and production scrap and remanufacturing that feedstock into critical materials.

Ultimately, Redwood will produce 100 GWh annually of ultra-thin battery-grade copper foil and cathode-active materials from both new and recycled feedstocks at gigafactory scale in the United States for the first time. This will provide enough battery materials to produce more than one million electric vehicles a year domestically.

To meet increased demand for lithium-ion batteries, recycling will play an increasingly important role in battery materials production. On average, Redwood can recover greater than 95% of the critical battery elements in an end-of-life battery (including lithium, nickel, cobalt, manganese, and copper), and then use those metals to manufacture anode and cathode components domestically for U.S. battery cell manufacturers.

The two most essential and valuable components in a battery are the anode and cathode. The cathode contains all the critical metals in a battery—e.g., lithium, nickel, and cobalt—and requires a complex manufacturing process and functional specification integral to the performance and safety of an electric vehicle battery. The anode contains copper and graphite and is primarily responsible for a battery’s charging performance. Together, these components amount to nearly 80% of the materials cost of a lithium-ion battery.

Today, these components are manufactured entirely overseas, predominantly in Asia. Without domestic production, US battery cell manufacturers are estimated to offshore more than $150 billion in economic value for anode and cathode components by 2030.

Redwood is committed to solving this by manufacturing anode and cathode components in the US and producing them from an increasing amount of recycled content. Redwood Materials’ Nevada operation currently recycles end-of-life batteries from consumer electronics such as cell phone batteries, laptop computers, power tools, and other electronic waste. Last month, the company began producing anode copper foil at its Northern Nevada facility, marking exactly one year from the initial site groundbreaking to start of production.

Phase One of copper foil is now complete and later this year, the company expects to begin cathode qualification. Among other partners, Panasonic will be the first to source Redwood copper foil for cell production in the Nevada Gigafactory and its cathode material for battery cell production in its new Kansas plant, targeted to come online in 2025.

Redwood said that it has been working closely with the Loan Programs Office for more than a year and have undergone an extensive diligence process that thoroughly reviewed technology, the ability to repay the loan, product demand, and dozens of other factors to get to this stage.

The project allows battery and automotive manufacturers to meet the new stringent critical mineral and battery component requirements for consumers to qualify for electric vehicle tax credits as established by the “Inflation Reduction Act”. These policies support the localization of the battery supply chain—Redwood’s core mission.