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For EV engineers, energy investors, and sustainability advocates, Redwood Materials is doing what many considered impossible: making battery recycling profitable, scalable, and essential to the domestic supply chain. In an exclusive tour, JB Straubel—the co-founder of Tesla and now CEO of Redwood Materials—guides the Munro team through a remarkably lean and vertically integrated facility that transforms end-of-life lithium-ion batteries and production scrap into valuable, reusable material streams.
This tour doesn’t just showcase equipment. It reveals how intelligent engineering, lean manufacturing, and bold reinvention can push EV battery recycling to industrial scale—without subsidies, and with profit.
Redwood’s Role in the EV Ecosystem
While Redwood doesn’t manufacture EVs or battery packs, it plays a crucial behind-the-scenes role in the EV lifecycle. The company’s mission centers on capturing critical materials—lithium, nickel, cobalt, copper—from both spent batteries and gigafactory scrap. It then refines these into compounds that can re-enter the battery production loop.
Straubel explains that Redwood’s first goal is reuse. If a battery pack still has 50%–80% of its energy capacity—as many do—they repurpose it into second-life energy storage, often for stationary applications like data centers and microgrids. This extends the value of the battery before it undergoes recycling.
Battery Receiving and Safe Storage
The tour begins with Redwood’s expansive battery receiving yard—a dynamic 20–25-acre site outside Reno, Nevada. Safety and material sorting are paramount. High-energy “live” batteries, including entire EV packs, are stored outdoors in designated crates, drums, or steel containers to manage fire risk.
Batteries range in origin from full automotive packs to tool batteries and jump starters. Many are still enclosed in their original housings. Others arrive from OEM partners for diagnostics or reuse. “We see the good, the bad, and the ugly,” Straubel notes. This variety offers invaluable learning opportunities for engineers seeking to optimize recycling pathways and material characterization.
Inert Scrap and Lean Storage
Inside, Redwood stores “inert” production scrap—non-energized materials like electrode swarf or uncharged cell rejects—in high-density racks. These materials never held a charge and pose lower safety risks, allowing for more compact and efficient handling. As a result, the facility can manage high-volume flows without excessive spatial demand.
This scrap comprises edge trimmings, foil coatings, and separator materials from battery factories—high in critical metals, even if they never powered a single device.
Proprietary Calcination Technology
One of Redwood’s most significant engineering feats is its calcination unit. Designed and built entirely in-house, this fifth-generation rotary kiln is engineered to render lithium-ion batteries inert before mechanical shredding. Unlike traditional incineration, Redwood’s process uses an inert nitrogen atmosphere to heat the modules to several hundred degrees Celsius without burning them.
This thermally breaks down organic components like electrolyte solvents, adhesives, and separators, while the remaining charge in the cells provides much of the energy needed to sustain the process. The result is a carbonized, brittle material that’s far easier—and safer—to shred.
The gases from this process pass through a sophisticated system of scrubbers and filters that remove fluorines, chlorides, and particulates. These too are treated as recoverable materials, with efforts underway to precipitate and recycle fluoride compounds.
Automated and Adaptable Material Handling
The Redwood system is built for flexibility. Incoming batteries vary wildly by size, chemistry, and enclosure design. The facility uses conveyors with fire-resistant components and modular automation to handle everything from tool batteries to full EV modules—including fully charged units.
Operators carefully load battery packs onto conveyors that feed directly into the kiln. This removes the need for labor-intensive disassembly and enhances throughput. It’s “un-manufacturing” at industrial scale—disassembling without schematics, standardization, or uniform size.
Redwood even processes units submerged in salt water, fire-damaged modules, or batteries that failed final inspection. This agnostic approach makes it uniquely positioned to handle the growing tidal wave of retired EVs and gigafactory scrap.
Separation, Refinement, and Value Recovery
Redwood shreds the inerted materials and mechanically separates them into distinct streams: aluminum, copper, steel, and black mass—a fine powder rich in nickel, cobalt, and lithium. The team aggregates these materials until they can fill full semi-truck shipments, sending metals to appropriate recycling smelters and reserving the black mass for in-house refinement.
This is the real money line. From here, Redwood begins chemical refinement using hydrometallurgy. Lithium, for example, is dissolved and reprecipitated as lithium sulfate—a pure, battery-grade compound. The company produces this and other compounds domestically, selling them directly back to U.S. battery manufacturers.
A Profitable Circular Model
Redwood has three main revenue streams:
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Second-life energy storage systems, powered by repurposed EV packs;
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Sale of refined intermediate materials, similar to traditional mining outputs;
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Manufacture and sale of cathode active materials, the most technically demanding and valuable part of a battery.
Despite operating in a notoriously cost-sensitive industry, Straubel emphasizes that Redwood is profitable—even without government subsidies. “We’re able to compete with mining,” he says, “and we’re doing it with material already above ground.”
The company now processes roughly 20–25 GWh worth of battery material per year and holds 70%–75% of North America’s lithium-ion recycling market share. With partnerships like Ford’s $50 million investment, Redwood is rapidly scaling.
Microgrid Innovation and Circular Energy
In addition to material recovery, Redwood has built one of the world’s largest second-life battery energy storage systems. Located on campus, this 60 MWh microgrid—powered by 20 MW of solar—runs a data center entirely off-grid. All of it is driven by reused EV batteries and offers electricity below utility rates.
It’s a proof of concept: recycling and reuse don’t just close material loops—they can power the next generation of infrastructure.
Training the Future Workforce
Redwood also invests in people. By partnering with community colleges and trade schools, they’re building a pipeline of skilled workers ready to support the clean energy transition. For Straubel, trades matter just as much as PhDs. “There’s a hunger for their skill set,” he notes. And that’s where real-world industrial transformation begins.
Conclusion
Redwood Materials isn’t just recycling batteries—it’s reinventing the energy value chain. From disused EV packs to high-purity lithium sulfate, the entire process runs lean, clean, and scalable. For engineers and EV investors, the takeaway is clear: the future of energy isn’t just about new batteries—it’s about using the old ones smarter.
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Want more insights into the future of EVs, battery technology, and teardown engineering? Check us out at Munro & Associates and subscribe to Munro Live to follow our deep-dive tours and interviews across the automotive world.