The US aims to move its battery supply chain from China, which presently accounts for 70% of the world’s EV battery production. Credit: dcbel / Unsplash.

US Department of Energy (DOE) Loan Program Office has granted a conditional commitment of a $2bn loan to Redwood Materials to support the construction of a $3.5bn recycling and re-manufacturing complex for battery materials for electric vehicles (EV) in Nevada, US.

Later this year, Redwood Materials anticipates drawing down on the first loan tranche.

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According to Redwood Materials, the loan will help accelerate the construction and expansion of its battery materials campus in Nevada.

At the Nevada complex, the company started producing copper foil for battery anodes last month. It later expects to commence cathode qualification too.

Set up in 2017, Redwood Materials is a recycler and re-manufacturer of battery materials that include lithium, nickel, copper, and cobalt.

Besides Nevada, the company plans to construct a similar facility in Charleston, South Carolina, with an investment of around $3.5bn.

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Each of these facilities will initially be able to manufacture 100 gigawatt-hours (GWh) of electrode materials, sufficient to supply over one million EVs a year domestically.

The South Carolina complex could later be expanded to “several hundred gigawatt-hours.”

Redwood Materials also added that it would supply copper foil to the Nevada gigafactory that is jointly operated by Panasonic and Tesla to produce battery cells.

In addition, it will supply cathode material to Panasonic’s new Kansas battery plant, which is expected to open in 2025.

It also has supply agreements with Ford, Toyota Motor, and Volkswagen Group.

Ever since the Inflation Reduction Act (IRA) was passed in August last year by US President Joe Biden, there has been a lot of activity among EV and battery manufacturers in the country, reported Reuters.

The IRA aims to move the US battery supply chain from China, which presently accounts for 70% of the world’s EV battery production.

In July 2022, DOE announced a $2.5bn loan to Ultium Cells to help fund the construction of battery cell manufacturing facilities in Tennessee, Ohio, and Michigan. Ultium Cells is a joint venture between General Motors Co. and LG Energy Solution.

Furthermore, in January, the department announced its plan to provide a loan of up to $700m to Ioneer for constructing its lithium mining project in Nevada.