Redwood Materials Raises Another $350M to Power Up Its Energy-Storage Business
A major milestone has arrived for sustainability-driven tech. Redwood Materials raises another $350M to power up its energy-storage business, positioning itself as a key player in powering the growing AI data center ecosystem.
Image Credits:Redwood Materials
The Series E funding round, led by Eclipse, also attracted Nvidia’s venture capital arm, NVentures. Although the valuation remains undisclosed, a source familiar with the deal confirmed it’s around $6 billion—a billion higher than its last valuation. The investment highlights growing confidence in Redwood’s mission to close the loop on battery production and expand into large-scale energy storage.
A Push Toward Energy Storage and Circular Supply Chains
Redwood Materials plans to use the new funding to expand its energy-storage business, refine materials production, and strengthen its workforce. Founded in 2017 by former Tesla CTO JB Straubel, the company initially focused on creating a circular battery supply chain by recycling used batteries from consumer electronics and EVs.
This model allows Redwood to extract valuable materials like lithium, nickel, and cobalt, reducing dependence on mining while supplying refined materials back to partners such as Panasonic, GM, and Toyota. The company’s approach supports both sustainability goals and domestic battery production capacity in North America.
Redwood Energy: Powering the AI and Data Center Boom
The new business arm, Redwood Energy, takes the company’s mission further. Instead of immediately recycling EV batteries, Redwood repurposes them for energy storage systems that support AI data centers and large-scale industrial facilities.
These systems connect retired EV batteries with renewable sources like solar and wind, forming off-grid power setups that stabilize energy supply. The company says these batteries can also integrate with natural gas turbines or future nuclear power generators to meet growing energy demands efficiently and sustainably.
Turning Used EV Batteries into a Clean Energy Asset
Redwood’s advantage lies in its vast collection of used EV batteries. The company recovers more than 70% of all discarded battery packs in North America, many of which still have significant life left. By repurposing them, Redwood not only cuts waste but also helps industries transition toward cleaner, circular energy solutions.
As of mid-2025, Redwood had stockpiled over 1 gigawatt-hour (GWh) of batteries available for energy storage deployment. By 2028, the company plans to reach 20 GWh of grid-scale energy storage capacity, which would make it the largest repurposer of used EV battery packs in the world.
Strategic Partnerships and Long-Term Vision
Investors like Nvidia’s NVentures are eyeing Redwood as a bridge between sustainable energy and AI infrastructure. With data centers consuming unprecedented amounts of power, efficient battery-based energy storage could become vital for stable operations and reduced emissions.
Eclipse’s participation signals confidence in Redwood’s scalable technology and circular economy model. By focusing on both recycling and reuse, Redwood Materials positions itself as a crucial partner in the global clean energy transition—not just a battery recycler, but a power enabler for the future of AI-driven industries.
The Road Ahead for Redwood Materials
As the clean energy race accelerates, Redwood Materials’ $350M funding marks a pivotal chapter in its growth. With a focus on circular innovation, the company continues to prove that sustainability and profitability can align—especially when AI and renewable energy intersect.
By combining cutting-edge recycling, efficient repurposing, and forward-thinking partnerships, Redwood is paving the way for an energy future built on reuse, resilience, and renewable power.
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