Nevada battery recycler gets a $2b loan to break China’s dominance of EV battery supply chain.

The Biden administration has awarded a $2 billion green energy loan to a Nevada company that recycles batteries for electric vehicles.

The former chief technical officer of Tesla Inc. formed Redwood Materials, a recycling company, and obtained the conditional loan through the Energy Department’s Advanced Technology Vehicles Manufacturing program, which also aided Tesla more than ten years ago.

Gov. Joe Lombardo and Energy Secretary Jennifer Granholm made the award announcement in front of dozens of Redwood employees on a stage at the Nevada facility on Thursday.

Granholm said, pointing to a map featuring 80 battery manufacturing or supply chain companies that are growing or opening in the U.S., “This region is leading the way to a bigger tale of what is occurring in the country.” According to her, the majority have been made public in reaction to the infrastructure law signed by President Joe Biden in 2021 and the climate law he passed the previous year.

As part of its bigger effort to transition away from gas-powered cars in the fight against climate change, the Biden administration hopes that battery recycling will help the United States build its own electric vehicle supply chain. As part of the fight against climate change and to oppose China’s long term dominance in the supply chain, Biden has also supported domestic manufacturing of crucial minerals used in EVs and other technologies.

With Redwood and other projects under way, Granholm bragged that “China could be starting to worry.” We’re just getting started, I respond to that.

The Energy Department claimed that their conditional commitment shows the project in Nevada would be financed, but there are still a number of procedures to complete before a final loan can be approved.

Former Tesla Chief Technology Officer Jeffrey “JB” Straubel established Redwood Materials in 2017. With Ford and Panasonic, which produces batteries for Tesla, it currently employs more than 300 people who recycle discarded batteries.

According to Straubel, the company already has more material than it can handle, including production waste from the manufacture of lithium-ion batteries as well as used consumer batteries from lawnmowers, telephones, and toothbrushes.

Lithium, nickel, cobalt, manganese, and copper are among the metals in a spent battery that the company claims it can recover in excess of 95% of. The anode and cathode components for fresh battery cells are then created using the metals.

Because you’re concentrating on the components that we don’t have in the United States, Redwood Materials “is going to play an outsized role in bringing the batteries supply chain home,” Granholm told employees at the event on Thursday. In this, you guys are writing history.

According to the agency, Redwood Materials is anticipated to add around 1,600 full-time jobs and 3,400 construction positions.

Former Republican governor Brian Sandoval, who was present on Thursday, was responsible for the beginning of Redwood Materials’ existence in Nevada. Before the loan was conditionally granted under Lombardo, who admitted he was a latecomer to negotiations, it continued under Democratic Governor Steve Sisolak. The investments and resulting employment enable Lombardo and previous governors keep their campaign promise to diversify Nevada’s casino and tourism-based economy.

To succeed in the state of Nevada, Lombardo remarked, “We’re going to have to do this.” All of our eggs cannot be in one basket.

Redwood received $105 million in tax incentives from the Nevada Governor’s Agency of Economic Development in December, the second-largest capital investment in the history of the office (after Tesla).

As the United States looks for domestic supply of the essential component in electric vehicle batteries, the Energy Department last month approved a conditional loan of $700 million to an Australian company to mine lithium in northern Nevada.

Redwood has also made plans to erect a $3.5 billion complex in South Carolina for the production and recycling of batteries.

It will be the first domestic facility to support production of anode copper foil and cathode active materials for a lithium-ion battery manufacturing process once the battery materials campus in McCarran, Nevada, outside of Reno, is completely operational. According to a blog post by the Energy Department, the procedure would recycle production scrap and battery end-of-life materials and remanufacture them into essential elements.

The CEO of Redwood, Straubel, told reporters last year that the United States own supply chain for electric vehicles will be aided by recycling battery materials. China now controls a large portion of the EV supply chain, including key minerals required for EV batteries.

Redwood “fills a vital gap in that overall piece,” and according to Straubel, “our goal is to finish the loop on all the resources that we’ve previously mined and manufactured into products, keep them in the locations where they were bought and are being used.” “Every battery we can recycle saves us the cost of mining the same minerals again.