Battery-recycling company Redwood Materials is stepping into the U.S.—building a $3.5-billion plant in South Carolina.
Key Details
- The plant will recycle old lithium-ion batteries to make two of the most expensive EV battery components—anodes and cathodes.
- The South Carolina location will allow Redwood to maximize benefits from the Inflation Reduction Act.
- Anodes and cathodes are typically sourced overseas, but the Inflation Reduction Act requires a majority of electric vehicle (EV) elements to be sourced locally, significantly boosting Redwood.
- The plant is set to begin operations by the end of 2023 and, when running, will produce enough materials to power a million EVs a year.
Why it’s news
EV batteries are in massive demand as the shift from gas-powered cars to EVs likely to take place over the next decade is ramping up. Sourcing material for those batteries is a critical issue.
Tesla co-founder JB Straubel is looking to expand his battery-recycling business to South Carolina, marking a boost for the critical EV battery market.
Redwood Materials uses lithium-ion batteries and recycles the materials to make necessary components for EV batteries, such as anodes and cathodes.
The anodes and cathodes release and capture electrons within a battery cell and are one of the most expensive components in an EV battery. The component is typically sourced overseas, but this new plant will bring the necessary material to the U.S.
The Inflation Reduction Act will give tax incentives for EV purchases for vehicles primarily produced in the U.S., so bringing the plant to South Carolina Redwood will benefit from the Act.
“There’s a giant wave of battery manufacturing heading toward the U.S. because of the Inflation Reduction Act, so having a footprint for us that’s more geographically spread across the U.S. is super helpful,” says Straubel. “They’re expanding, especially in the Southeast, creating this so-called battery belt between Michigan and Georgia. That’s part of the calculus for us on why we want to develop a footprint right in the middle of the region to support that.”
The plant is set to begin construction in early 2023, with production starting at the end of the year. When running, it will produce 100 gigawatt hours of anodes and cathodes, or enough for a million EVs a year, according to Straubel.