The U.S. Vitality Division on Thursday made a conditional dedication to Redwood Materials for a $2 billion low-cost authorities mortgage to assist construct out a $3.5 billion recycling and remanufacturing advanced in Nevada for battery supplies.
Vitality Secretary Jennifer Granholm mentioned that, if finalized, the mortgage will assist the mission create vital supplies for electric vehicle batteries.
“It should be a slam dunk for our home burgeoning electrical automobile business,” Granholm mentioned, including that Redwood will play an “outsized position in bringing the battery provide chain dwelling — since you are centered on the items that we do not have in the US.”
Redwood Supplies expects to attract down the primary mortgage tranche later this yr, Chief Govt JB Straubel mentioned in an interview.
The preliminary mortgage draw “will assist speed up (manufacturing) and compress the time for us to get to full scale” on the northern Nevada advanced, which has began to provide copper foil for battery anodes, Straubel mentioned.
Straubel mentioned there was “a frenzy of exercise” amongst electrical automobile and battery producers since President Joe Biden signed the Inflation Discount Act (IRA) in August. The IRA guidelines are designed to shift the U.S. battery provide chain away from China, which at present produces 70% of batteries for electrical automobiles.
Final July, the Vitality Division mentioned it will mortgage $2.5 billion to Ultium Cells, a three way partnership between General Motors Co and LG Vitality Resolution, to assist finance development of latest U.S. battery cell manufacturing amenities.
Final month, the division mentioned it deliberate to mortgage Ioneer Ltd as much as $700 million to construct its Rhyolite Ridge lithium mining mission in Nevada.
The loans are coming from the Superior Know-how Automobiles Manufacturing (ATVM) mortgage program. Greater than 10 years in the past, the ATVM program offered low-cost authorities loans to Tesla, Ford Motor and Nissan Motor, which included some cell manufacturing.
Redwood Supplies, based in 2017 by former Tesla government Straubel, is on a path to turn into one of many world’s largest recyclers and remanufacturers of battery supplies, together with copper, lithium, cobalt and nickel.
Along with the Nevada web site close to Reno, Redwood Supplies in December mentioned it deliberate to assemble an identical facility northwest of Charleston, South Carolina, additionally at a price of round $3.5 billion.
Every facility could have an preliminary deliberate capability to course of 100 gigawatt-hours of electrode supplies, sufficient to provide greater than 1 million EVs every. The South Carolina advanced finally might be expanded to “a number of hundred gigawatt-hours,” Straubel mentioned.
Straubel mentioned the South Carolina mission is working about two years behind the Nevada facility.
Redwood Supplies mentioned it can provide copper foil from Nevada to Panasonic for battery cells produced on the Nevada Gigafactory that Panasonic collectively operates with Tesla. It can additionally provide cathode materials to Panasonic’s new Kansas battery plant, which is slated to open in 2025.
Redwood Supplies has provide agreements with various producers, together with Ford, Toyota Motor and Volkswagen Group.
(Reporting by Paul Lienert in Detroit and David Shepardson in Washington; Modifying by Sharon Singleton and Jonathan Oatis)