Redwood Materials is setting up shop near the Tesla Gigafactory as part of broader expansion

Redwood Materials, the battery recycling startup founded by former Tesla CTO JB Straubel, has purchased 100 acres of land near the Gigafactory that Panasonic operates with Tesla in Sparks, Nevada as part of an expansion plan that aligns with the Biden Administration’s drive to increase adoption of electric vehicles and boost domestic battery recycling and supply chain efforts.

The company said Monday that its existing 150,000-square-foot facility in Carson City, Nevada will also nearly triple in size. Redwood is adding another 400,000 square feet onto the Carson City recycling facility, which is expected to be operational by the end of the year.

As part of its growth plans, Redwood is also hiring hundreds of workers. The company, which is backed by Amazon, employs 130 people today and expects to add more than 500 jobs over the next two years.

Redwood’s expansion announcement follows the Biden Administration’s 100-day review of the U.S. supply chain and the release of a Department of Energy’ document that lays out a plan to improve the┬ádomestic supply chain for lithium-based batteries.

“America has a clear opportunity to build back our domestic supply chain and manufacturing sectors, so we can capture the full benefits of an emerging $23 trillion global clean energy economy,” Energy Secretary Jennifer M. Granholm said Monday in a statement. “Private sector investment like this is a sign that we can’t slow down. The American Jobs Plan will unlock massive opportunities for US businesses as it spurs innovation and demand for technologies–like vehicle batteries and battery storage–creating clean energy jobs for all.”

Redwood Materials, which was founded in 2017, is trying to create a circular supply chain. The company has a business-to-business strategy, recycling the scrap from battery cell production as well as consumer electronics like cell phone batteries, laptop computers, power tools, power banks, scooters and electric bicycles. Redwood collects the scrap from consumer electronics companies and battery cell manufacturers like Panasonic. It then processes these discarded goods, extracting materials like cobalt, nickel and lithium that are typically mined, and then supplies those back to Panasonic and other customers. The aim is to create a closed loop system that will ultimately help reduce the cost of batteries and offset the need for mining.

Redwood Materials has a number of customers, and has only publicly disclosed that it is working with Panasonic, Amazon and AESC Envision in Tennessee

Redwood Materials says it recovers about 95% to 98% of the elements from the batteries such as nickel, cobalt, lithium and copper. Today, it receives 3 gigawatt-hours annually, a figure that the company says is equivalent to about 45,000 cars.