Redwood Materials: Energy Storage for AI Data Centers
Redwood Materials is revolutionizing energy storage. The company, through its Redwood Energy division, is now giving a second life to retired EV batteries, turning them into valuable grid-scale storage solutions. Starting with a microgrid powering a Crusoe AI data centre, Redwood is demonstrating the potential for a sustainable circular economy. News Directory 3 reports on this innovative approach, highlighting the company’s aspiring plans to deploy 20 GWh of grid storage by 2028. This venture not only addresses the growing demand for energy storage but also provides a profitable, carbon-free solution. See how Redwood Materials is leading the way in repurposing used batteries and what the future holds for this exciting technology.Discover what’s next …
Redwood Energy Turns Retired EV Batteries Into Grid-Scale Power
Updated June 27, 2025
Redwood Materials, led by co-founder and CEO JB Straubel, is expanding into energy storage with the launch of Redwood Energy. The new venture will repurpose retired electric vehicle (EV) batteries to provide grid-scale power, starting with a microgrid powering a Crusoe AI data center in Nevada.
The microgrid, located at Redwood’s Sparks, Nevada facility, utilizes 805 repurposed EV batteries to generate 12 MW of power with 63 MWh of capacity. The energy is sourced from an adjacent solar array and supplies a modular data center operated by Crusoe, known for its data center campus in Abilene, Texas.
Redwood Materials currently recovers over 70% of used EV batteries in North America, processing more than 20 GWh annually, equivalent to 250,000 EVs. The company has been stockpiling batteries not yet ready for recycling, holding over 1 GWh in inventory and expecting an additional 4 GWh in the coming months.
By 2028, Redwood plans to deploy 20 GWh of grid-scale storage, positioning itself as a major player in EV battery repurposing. Straubel emphasized the revenue-generating and profitable nature of the Crusoe project, indicating plans for further deployments with other customers this year.
Redwood Materials has been expanding its operations, securing deals with Toyota, Panasonic, and GM, constructing a factory in South Carolina, and acquiring a European battery recycler. The company generated $200 million in revenue in 2024 from battery material sales.
Redwood Energy’s microgrids can be powered by renewable sources like wind and solar or connected to the grid. Colin campbell, Redwood’s CTO, highlighted the economic benefits of the approach, stating, “It’s a good economic choice that also happens to be carbon-free.”
Jessica Dunn, a battery expert at the Union of Concerned Scientists, noted the profit potential in repurposed EV batteries, indicating the future direction of the end-of-life market.
Straubel acknowledged that Redwood Materials started early in anticipation of the wave of used EV batteries. The current recycling market primarily consists of manufacturing scrap, consumer electronics, and warranty-failed EV batteries. Redwood processes over 20 GWh annually, but this is expected to increase considerably with the growing number of EVs.
Redwood operates a recycling facility in Sparks, Nevada, and is developing a facility in Charleston, South Carolina, to remanufacture cathode and anode copper foil.The company aims to produce 100 GWh annually of cathode active material and anode foil by the end of this year, with a target of 500 GWh by the end of the decade.
What’s next
redwood Energy plans to expand its grid-scale storage solutions, partnering with more companies to deploy microgrids powered by repurposed EV batteries. The company aims to play a significant role in the energy storage sector, contributing to a more lasting and circular economy.