Former Tesla exec inks new recycling deal as battery costs soar 

Stroll with JB Straubel via the Redwood Supplies recycling plant in Carson Metropolis, Nevada, and one factor stands out: Pallets stacked on high of pallets crammed with outdated batteries, faulty battery cells and scrap materials from the close by Panasonic plant.

“The sheer magnitude of the waste and scrap drawback and the magnitude of batteries that have to get recycled is, I feel, surprising to most individuals,” mentioned Straubel, founder and CEO of Redwood Supplies. Straubel spent greater than a decade at Tesla, earlier than resigning as chief technical officer in 2019 so he may give attention to rising his recycling firm.

Redwood Supplies has reached an settlement to recycle scrap and faulty battery cells for Envision AESC, which manufactures batteries for the Nissan Leaf in Smyrna, Tennessee. It’s the newest transfer for the corporate Straubel began in 2017 to provide battery makers and auto firms with uncooked supplies briefly provide as EV manufacturing surges all over the world. 

“We convey the supplies again to a really clear and kind of basic state so there isn’t a loss in effectiveness,” mentioned Straubel. “It is really indistinguishable whether or not there’s cobalt coming by way of an outdated battery or from a mine.” 

Cobalt, lithium, nickel, and different minerals and metals utilized in EV batteries have grow to be extremely popular commodities, so scorching, costs have rocketed to 52-week highs. Fueling the rise in costs is an introduced surge in lithium-ion battery manufacturing as automakers from Tesla to General Motors and Ford dramatically improve EV plans over the following decade.   

“To make the batteries the world wants in 10 years, the business will want 1.5 million tons of lithium, 1.5 million tons of graphite, 1 million tons of battery-grade nickel and 500,000 tons of battery-grade manganese. The world produces lower than a 3rd of every of these supplies right now. New battery supplies sources are extremely valued and desperately wanted,” mentioned Sam Jaffe, managing director at Cairn ERA, an vitality consulting agency.  

To drive residence his level, Jaffe factors out U.S. lithium-ion battery demand topped 43 megawatt hours final 12 months and can climb to 482 megawatt hours by 2030.

The expansion is unbelievable information for Panasonic, which manufactures battery cells on the Gigafactory it operates with Tesla in Sparks, Nevada. Because of its newest enlargement, the Gigafactory will produce slightly below 2 billion battery cells this 12 months.

Allan Swan, who runs the plant, says much more manufacturing is required. “Right here in the US, we definitely want 4, 5, six of those factories to help the automotive business,” he mentioned.  

Celina Mikolajczak, vp of engineering and battery know-how at Panasonic Vitality North America, believes the booming EV plans means the business has to take a look at recycling batteries as a brand new supply for key minerals.

“There’s loads of vitality spent extracting these minerals and it makes completely no sense to landfill them,” she mentioned. “We might be actually silly if we did not reap the benefits of the capability of older cells, to create the following technology.”

Straubel and his workforce at Redwood wish to say the most important lithium mine is within the junk drawers of America. It’s a reminder Redwood is positioning itself to recycle a variety of lithium-ion batteries, not simply people who go into electrical autos. Nonetheless, given Straubel’s lengthy tenure at Tesla and his huge information of the EV market, he’s intently watching the quickly increasing EV market.

As Straubel ripped open the packaging holding an outdated laptop computer battery that had been shipped to Redwood Supplies, he sized up the pallet of outdated batteries stacked as excessive as his waist.  He estimates there could also be a billion batteries in outdated laptops, cellphones and long-forgotten cordless instruments sitting round U.S. houses.

“I am just a little shocked that a number of the large OEMs (automakers) have taken maybe just a little longer to get absolutely pivoted and oriented on this course,” mentioned Straubel. “I am additionally just a little shocked at what number of different profitable and rising start-ups there are.”

Lots of these start-ups have grow to be publicly traded firms via SPAC mergers. Straubel thinks a number of the start-ups are intriguing, however a number of could have weak or questionable enterprise plans. Which of them? Straubel will not say, however he does have these phrases of warning for buyers.

“Assume calmly about the actual marketing strategy and the long-term potential,” he mentioned. 

— CNBC’s Meghan Reeder contributed to this text.


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