Redwood Materials launches energy storage business and its first target is AI data centers

Redwood Materials, founded by former Tesla CTO JB Straubel, has launched a new energy storage business called Redwood Energy, targeting AI data centers as its initial customers. The company is repurposing thousands of retired EV batteries—currently stockpiling over 1 gigawatt-hour and expecting an additional 4 gigawatt-hours soon—to create large-scale, clean energy storage systems. Their first project, in partnership with AI infrastructure firm Crusoe, involves a 12 MW, 63 MWh microgrid in Nevada that powers a modular data center using energy stored from an adjacent solar array. This operation is already profitable and marks a significant expansion beyond Redwood’s core battery recycling and materials supply business. Redwood Materials has built a circular supply chain by recycling battery scrap and consumer electronics to extract valuable materials like cobalt, nickel, and lithium, which it then sells to major manufacturers including Panasonic, Toyota, and GM. The company has also moved into cathode production and expanded its footprint globally. Redwood Energy