GM teams up with Redwood Materials to power data centers with EV batteries

General Motors is collaborating with Redwood Materials to repurpose both new and used electric vehicle batteries for energy storage applications. This innovative partnership was recently announced, highlighting a commitment to sustainability and efficient energy use. The initiative has already seen second-life batteries from GM successfully processed by Redwood, contributing to a 12-megawatt microgrid at Redwood's headquarters in Sparks, Nevada. This facility supplies power to a nearby data center operated by Crusoe, which utilizes 2,000 GPUs. This microgrid is a key component of Redwood’s energy storage division, which was publicly launched in June and aims to harness EV batteries for large-scale energy storage solutions. Through extensive testing, Redwood discovered that many batteries received still possessed significant remaining life. Instead of breaking them down for materials, the company has chosen to keep the batteries intact and connect them into a comprehensive energy storage system. This system is designed to store surplus energy generated from renewable sources, such as solar and wind, for future consumption. Notably, the batteries powering the Crusoe project are charged using solar panels. JB Straubel, co-founder and CEO of Redwood, expressed optimism, stating that this sector could grow at a pace even faster than their core recycling operations. Currently, Redwood is able to recover approximately 70% of all used or discarded batteries in the United States. The company has ambitious plans to deploy 20 gigawatt-hours of energy storage capacity by 2028. While Redwood is not alone in this venture, its unique capability to integrate various battery packs from different manufacturers may provide a competitive advantage. This expanded collaboration between GM and Redwood signifies a deeper commitment to energy storage solutions, especially as GM is prepared to supply both new and used batteries, ensuring a steady resource amid fluctuating EV sales. According to Cox Automotive, new EV sales saw a decline of 6.3% in the second quarter of this year, although a surge is anticipated ahead of the expiration of certain tax credits on September 30. In contrast, the energy storage market has been on a consistent upward trajectory, with new installations reaching record highs, increasing by 57% year-over-year in the first quarter of this year.