The U.S. Department of Energy is throwing big bucks behind Redwood Materials to help the company build a manufacturing facility for key battery components.
The Nevada-based company has already raised over a billion in funding from venture capital investors and automakers as it looks to create a more circular battery manufacturing business to supply electric vehicles. The company takes used batteries from automakers like Ford, Toyota, Volkswagen and Volvo and recycles the metals within them to make materials for new batteries.
With the money, Redwood Materials aims to build a factory that can provide battery materials for around 1 million electric vehicles. The company said that the loan would create around 3,400 construction jobs and another 1,600 full-time jobs to operate the factory when it's done.
"Over the next decade, there will be extraordinary investment to scale domestic battery cell production in the United States," Redwood Materials wrote in a statement. "This investment is critical to keeping the U.S. at the forefront of manufacturing and job creation, meeting our clean energy and sustainability goals and ensuring we strengthen our supply chains and lessen our reliance on foreign battery components."
As Redwood noted, the two essential components for a battery are the anode and the cathode.
The cathode is made up of critical metals like lithium, nickel and cobalt -- and needs a special manufacturing process to meet the safety requirements of batteries.
The anode is made up of copper and graphite and ensures that the battery can charge quickly, easily and safely.
Taken together the anode and cathode are nearly 80% of the materials cost of the battery, Redwood noted in a statement.
Right now, these materials and batteries are made offshore -- something that could cost U.S. manufacturers as much as $150 billion to ship onshore by 2030.
Redwood and the Department of Energy are hoping to solve that problem by boosting domestic manufacturing of these components.
"Redwood is committed to solving this by manufacturing anode and cathode components in the U.S. and producing them from an increasing amount of recycled content," the company said. "Last month, we began producing anode copper foil at our Northern Nevada facility, marking exactly one year from the initial site groundbreaking to start of production."
The battery maker Panasonic is sourcing the company's copper foil and cathode materials for battery cell production that are slated to begin in 2025.
"Ultimately, we 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," the company said. "This will provide enough battery materials to produce more than a million electric vehicles a year domestically."