Insider Q&A: JB Straubel, CEO of recycler Redwood Materials

Among the biggest challenges to transforming automobiles from combustion engines to electricity to fight climate change is the shortage of metals needed to make batteries

Insider-Q&A-Battery-Recycling (Redwood Materials)

Among the biggest challenges to transforming automobiles from combustion engines to electricity to fight climate change is the shortage of metals needed to make batteries.

Early on, JB Straubel saw a huge opportunity from the shortage — rescuing metals from spent lithium-ion batteries and recycling them for new ones.

The idea was so attractive that in 2019, the Tesla co-founder and former chief technology officer left the electric-vehicle company to co-found Redwood Materials. His vision: Create a loop of recycled supplies of lithium, copper, nickel, cobalt and manganese.

Now the startup based in Carson City, Nevada has more than 300 employees who recycle used batteries. It has supply contracts with Ford and Panasonic which makes batteries for Tesla.

Straubel, Redwood's CEO recently spoke to The Associated Press about the market for the metals and how recycling will help the U.S. establish its own electric-vehicle supply chain. The interview has been edited for length and clarity.

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Q: It’s going to be years before current electric-vehicle batteries wear out, and it will be years before EVs are sold in great numbers. So, are you a few years ahead of your time in recycling batteries?

A: I actually thought we were a few years early when we started this. But I’ve been really shocked at how many other sources of current lithium-ion battery materials there are to recycle that weren’t being addressed. We’ve actually had more feedstock than we can even process in the first few years of our ramp up. Just based on a combination of production scrap from the lithium-ion manufacturing process, as well as a whole diversity of consumer lithium-ion batteries, things like lawnmowers and cell phones and toothbrushes, there is a lot of material.

Q: Is it worth it to go in and get the copper out of an electric toothbrush?

A: Actually, it is. It's not just copper. Lithium-ion batteries are one of the highest value materials to recycle of modern consumer goods. They’re just difficult to do, and it’s quite tricky to get all those valuable elements out. It's also really great to keep that material out of the landfill and keep it out of the municipal recycling or waste streams where it can cause fires. It has some chemical hazards as well.

Q: Are you selling this stuff and making money?

A: We are. We’re not profitable yet because we’re growing so quickly and we’re reinvesting and will be for quite a few years. But the actual operations of recycling these batteries, that is profitable today. There's really a quite a hunger for these materials.

Q: Much has been written about the scarcity of raw materials for EV batteries and about establishing a domestic U.S. supply chain. Where does Redwood fit in?

A: Redwood fills a critical gap in that whole piece, and our goal is to close the loop on all the materials that we’ve already mined and produced into products, keep them in the regions where they were bought and are being used. That can immediately fill some of that. Every battery that we can recycle is one battery worth of materials that we don’t need to mine again. So we’re aiming to both fill a raw-material gap from the recycling and also fill a supply-chain gap.

Q: We don’t have a lot of these materials available in the ground in the United States. Does that make recycling more important?

A: It really does. Geographically, geologically, these materials are kind of scattered around the planet very unevenly. We do so much hard work to extract them the first time to move them to where people want to use them. It's a real shame not to benefit from all that logistics work and all that separation work. It really does make it all the more valuable to the regions that don’t have a wealth of this specific critical material.

Q: Can you keep reusing these metals in a second or third generation of batteries?

A: It almost sounds too good to be true, but you absolutely can continue that cycle of remanufacturing, recycling, rebuilding. We don’t see any degradation in the performance of those metals. They actually tend to get more pure as we go through additional cycles of manufacturing and refining.

Q: Can you serve all of North America from Nevada or do you have to decentralize?

A: We already are beginning to look at other locations. The manufacturing, particularly of cathode and copper foil, does tend to be a little more efficient at larger scale. Probably one large cathode manufacturing site in North America and one large site in Europe. The recycling operation tends to be a bit more distributed. We have our northern Nevada site. We are actively planning another center on the eastern side of the country.

Q: Can recycling supply the entire North American demand for these metals?

A: We need to basically fill the pipeline. First, we have to build the first generation of products, and that takes new materials. Once we have the fleets built, we don’t need to keep mining very many materials in order to keep sustaining it, renewing it. So every single year that goes by, from now until we end up in a closed loop system, the recycled material content will we’ll go higher and higher. Ultimately, yes, us, combined with many other recyclers, will be able to supply the majority of the market need.