Founded by Tesla’s ex-chief technologist, this battery recycling and production company has set up a division named Redwood Energy to oversee these initiatives. Their objective is to take ‘depreciated yet operational’ EV batteries from the recycling process and convert them into inexpensive, large-scale energy storage solutions, aimed at addressing essential energy grid shortcomings.

According to Redwood, they handle over 20 GWh of batteries each year, equivalent to 250,000 EVs, which constitutes around 90 percent of all recycled lithium-ion batteries and materials in North America. Many of these batteries are still viable with up to 50 percent of their energy capacity intact. Although they can no longer power an electric vehicle, they remain functional for other uses.

So rather than recycle those still functional batteries, Redwood is turning them into stationary storage systems. And the company says this will be a growing opportunity as more EV batteries reach the end of their lifespan. Redwood estimates that more than 100,000 EVs will come off the road this year alone.

After recovering the battery packs, Redwoods engineers perform a diagnostics check to determine whether its a suitable candidate for recovery or recycling. If its reusable, the pack is installed into “flexible, modular storage systems” which can operate independently or connect to the grid. Redwood says it has “over a gigawatt-hour” of reusable batteries in its pipeline, a number it expects to grow by 5 GWhs in the coming year.

Redwood has already deployed its first microgrid powered by upcycled EV batteries. The grid, with 12 MW of power and 63 MWh of capacity, is located at the company’s campus in Nevada and is being used to power a 2,000-GPU modular data center for AI infrastructure company Crusoe. Redwood calls it the “largest second-life battery deployment in the world” with enough energy to power “9,000 homes, support 20 Amtrak trips between New York and Washington, D.C., or charge an EV for a 240,000-mile journey—the distance to the moon.”

Redwood Materials was founded in 2017 by JT Straubel. In addition to breaking down scrap from Tesla’s battery-making process with Panasonic, Redwood also recycles batteries from Ford, Toyota, Nissan, Specialized, Amazon, Lyft, Rad Power Bikes, Lime, stationary storage facilities, and others. The company also produces anodes and cathodes, critical battery components, at a facility in South Carolina.