Redwood Materials said on Thursday it has received a conditional commitment for a $2 billion loan from the U.S. Energy Department to help build out a $3.5-billion recycling and re-manufacturing complex in Nevada for electric vehicle battery materials.
Redwood Materials expects to draw down the first loan tranche later this year, Chief Executive JB Straubel said in an interview.
The initial loan draw “will help accelerate (production) and compress the time for us to get to full scale” at the northern Nevada complex, which has started to produce copper foil for battery anodes, Straubel said.
Straubel said there has been “a frenzy of activity” among electric vehicle and battery manufacturers since President Joe Biden passed the Inflation Reduction Act (IRA) in August. The IRA rules are designed to shift the U.S. battery supply chain away from China, which currently produces 70 percent of batteries for electric vehicles.
Last July, the Energy Department said it would loan $2.5 billion to Ultium Cells, a joint venture between General Motors Co. and LG Energy Solution, to help finance construction of new battery cell manufacturing facilities in Ohio, Tennessee and Michigan.
Last month, the department said it planned to loan Ioneer Ltd up to $700 million to build its Rhyolite Ridge lithium mining project in Nevada.
The loans are coming from the Advanced Technology Vehicles Manufacturing (ATVM) loan program. More than 10 years ago, the ATVM program provided low-cost government loans to Tesla, Ford Motor and Nissan Motor, which included some cell manufacturing.
