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Why Amazon and Panasonic are betting on this battery recycling startup – TechCrunch

JB Straubel, the Tesla co-founder and former CTO, is commonly forged as the standard and pioneering engineer, the quiet one who toiled away within the background for 15 years on a few of the firm’s most vital applied sciences. That characterization — which intensified because the hype and media consideration on Tesla CEO Elon Musk grew — tells a half fact.

Straubel isn’t vulnerable to self-promotion, and even progress studies. His private Twitter account, nor the one devoted to his startup, Redwood Materials, has ever even tweeted. And he does like toiling away on complicated issues.

However his understated supply obfuscates his ambitions and plans for Redwood Supplies, the recycling startup that he co-founded in 2017. Straubel envisions and is actively working to make Redwood one of many world’s main battery recycling firms, with quite a few amenities strategically scattered all through the globe.

“That is one thing that may be a main trade and a serious downside, and it’s a giant a part of why I need to spend my time on it,” Straubel stated on PJDM’s digital stage Wednesday at TC Periods: Mobility. “I need to do one thing that may really make a very materials affect on sustainability on the earth. And also you want scale to try this. So I’m very excited to continue to grow this and to be one in every of, if not the main battery recycling firm on the earth. And finally, one of many massive battery supplies firms on the earth.”

The Carson Metropolis, Nevada-based firm, which Straubel runs, is aiming to create a round provide chain. The corporate has a business-to-business technique, recycling the scrap from battery cell manufacturing in addition to client electronics like mobile phone batteries, laptop computer computer systems, energy instruments, energy banks, scooters and electrical bicycles. Redwood collects the scrap from client electronics firms and battery cell producers like Panasonic. It then processes these discarded items, extracting supplies like cobalt, nickel and lithium which can be sometimes mined, after which provides these again to Panasonic and different clients. Redwood Supplies has a variety of clients, and has solely publicly disclosed that it’s working with Panasonic and Amazon.

Picture Credit: Redwood Supplies

Whereas Redwood Supplies is a B2B firm, its enterprise mannequin might sometime develop. Curiosity has been so excessive that Straubel is now considering whether or not it also needs to develop right into a extra consumer-facing enterprise as properly. Redwood might by no means provide assortment websites the place shoppers can drop off outdated smartphones and different client electronics. Nevertheless, the variety of inquiries from native authorities officers, in addition to shoppers searching for choices to recycle electronics, together with the batteries in EVs, has prompted Straubel to at the least take into account the chance.

What is identified is that Straubel sees quite a few amenities — maybe dozens — getting arrange regionally, and in some circumstances co-located with factories if the client is massive sufficient. The corporate hasn’t disclosed the place these future amenities can be positioned.

The corporate has two recycling and processing amenities in Carson Metropolis. And whereas that hardly qualifies it as one of many world’s largest battery recycling firms, Redwood is already working on the “gigawatt scale.”

“We’ve been capable of develop extraordinarily shortly and to ramp up our capability and I count on that can comply with roughly the size of lithium-ion manufacturing, lagging by just a few years,” he stated.

To place Straubel’s phrases into context, take into account the Gigafactory that Panasonic operates with Tesla in Sparks, Nevada. Right this moment, the manufacturing unit has the capability to provide 35 gigawatt hours of lithium-ion battery cells yearly. If Straubel hit the size he’s capturing for, Redwood could be supplying Panasonic with sufficient supplies to match that manufacturing capability. Reaching that objective would essentially change Panasonic’s provide chain away from minerals that had been mined and towards these recycled by Redwood. These recycled supplies would come from Panasonic’s manufacturing scrap in addition to different sources of client electronics.

Celina Mikolajczak, vice chairman of battery know-how at Panasonic Power of North America, stated it might be silly for the corporate to disregard the recycling provide.

“We’ve already dug these metals out of the bottom, we’ve put them in cells, they’re sitting there,” Mikolajczak stated in the course of the joint interview with Straubel at TC Periods: Mobility. “And yeah, it’s somewhat tough to deal with cells, they course of somewhat in a different way than a typical metallic ore, proper, however on the similar time, we now have a a lot greater focus of the metals we’d like than a typical metallic ore. So it makes complete sense to go after recycling and to do it aggressively as a result of there’s numerous it, there’s numerous batteries already out on the earth.”

Second-life batteries

Right this moment, the vast majority of lithium-ion batteries utilized in smartphones and different client electronics are usually not recycled and as an alternative both sit forgotten within the proprietor’s junk drawer or enter the waste stream and find yourself in a landfill. Electrical autos have a for much longer shelf life, so to talk. However finally batteries utilized in electrical autos will pose a problem for automakers, in addition to communities grappling with the waste.

Straubel desires Redwood to be part of that end-of-life answer for electrical automobile batteries as properly.

“The second-life concern and the way these batteries are recovered it’s actually attention-grabbing and there’s numerous completely different concepts round about how batteries can go into a complete second software,” Straubel stated, noting that Redwood isn’t working instantly on second-life use circumstances. “It’s nice if we will get extra helpful life on these units by reusing them for a time period, but it surely solely delays the inevitable; they finally want an applicable disposal, and recycling answer.”

Straubel stated he desires Redwood to be that backstop.

There are a variety of automakers which have talked about repurposing EV batteries for power storage. However the particulars of how an OEM would possibly recapture these batteries again from shoppers is scant. Straubel desires Redwood to be an unbiased firm so it might associate with all OEMs producing electrical autos and supply its supplies throughout the complete trade.

Redwood has by no means talked publicly about which automakers it’d or already is partnering with. Nevertheless, wanting throughout the EV panorama just a few possible companions emerge. As an illustration, electrical automobile startup Rivian has by no means introduced plans to work instantly with Redwood Supplies. However the firms do share Amazon as an investor and buyer. Rivian CEO RJ Scaringe and Straubel not solely know one another, they share a standard imaginative and prescient.

Scaringe has talked about plans for second-life batteries — albeit with out numerous element but — in addition to what occurs on the finish of a battery’s life. Rivian doesn’t have any autos on the highway right now, so it’s a seemingly distant downside. That modifications in 2021 when the corporate will carry an electrical pickup truck and SUV to the patron market, as properly electrical vans to Amazon. Finally, Rivian has a contract to ship 100,000 electrical vans to Amazon.

“I’m actually enthusiastic about what JB [Straubel] is doing as a result of we’d like to have these autos be a feedstock, and the batteries from these autos be a feedstock to then start one other begin of lifecycle for an additional set of batteries and electrical autos,” Scaringe stated in an interview final month on the Bloomberg Inexperienced Summit, through which he joined Straubel and Ross Rachey, director of World Final Mile Fleet and Merchandise at Amazon, on a panel. “The flexibility to regulate this basically as a closed ecosystem permits us to study and construct the muscle reminiscence for this as the entire trade begins to shift not solely to electrification, however completely different strategies of consumption as properly.”

All about scale

Straubel stated he isn’t fascinated with taking Redwood Supplies public, definitely not within the quick time period.

“For higher or worse, I had a entrance row seat to a few of the much less environment friendly components of being a public firm,” Straubel stated, a remark directed to Tesla’s public standing. “It’s nothing that I’m speeding towards. I believe that being public is someway equated with success, which doesn’t actually make sense.”

He stated his objective is for Redwood to make an affect, do one thing significant at an industrial scale and generate returns — aka be worthwhile.

“It’s not about going public shortly, or, you understand, making an attempt to offer a fast return to buyers or one thing like that,” Straubel stated. “That is what I actually need to spend my time on. And I see this as a really long-term progress mission that’s more likely to span many years.”

Smartphone discarded consumer electronics

Employees type by means of a pile of used cell phones in New Delhi, India. (Picture Credit: Getty Photographs / Kuni Takahashi/Bloomberg)

Straubel talks quite a bit about scale, each by way of his imaginative and prescient for Redwood in addition to the present state of e-waste sitting in junk drawers of U.S. shoppers. It was the size of the Gigafactory, which is utilized by Panasonic to make battery cells and by Tesla to make the battery packs and electrical motors for its autos, that partially drove Straubel to begin Redwood within the first place.

“Because the world electrifies transportation it wants so many various supplies and the availability chain upstream of the manufacturing unit is, I believe, usually underneath appreciated,” he stated. “The Gigafactory is somewhat bit like an iceberg — there’s a lot of it that’s form of beneath the floor, within the suppliers and within the mines and refineries and all of the various things that must feed into it that you just don’t sometimes see.”

Elements of the availability chain grew to become extra of a bottleneck because the Gigafactory ramped, he added.

“You definitely see Tesla focusing extra on this, I believe rightly so,” Straubel stated, a nod to Musk’s latest public feedback about must give attention to the broader provide chain of supplies reminiscent of nickel. “That was a really attention-grabbing space that I believed wasn’t getting as a lot consideration and end-of-life and recycling as part of that materials provide chain is simply an extremely highly effective area, one the place I believe we will have a serious affect on the sustainability of making batteries.”

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Kirsten Korosec