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(Reuters) – Redwood (NYSE:RWT) Materials is the latest company to set up shop in South Carolina’s growing community of electric vehicle and battery manufacturers, the Carson City, Nevada-based firm said on Wednesday.
Redwood said it will build a $3.5 billion battery materials campus in Ridgefield, about 30 miles (48.28 km) northwest of Charleston, that will recycle, refine and remanufacture cathode and anode materials such as nickel, cobalt, lithium and copper.
Anode and cathode components, which make up most of an EV battery’s cost, are not yet produced in North America.
But several companies have announced plans to make those components in North America by mid-decade, to take advantage of incentives built into the U.S. Inflation Reduction Act. The IRS aims to reduce imports of batteries and materials from China, which controls the flow of refined minerals such as nickel and cobalt.
The Ridgefield facility aims to begin recycling late next year and ramp up component manufacturing capacity to 100 gigawatt-hours by 2025 — enough to supply battery materials for more than a million electric vehicles, the company said.
The Redwood Materials campus, which is located near the U.S. assembly plant for Volvo and Polestar electric vehicles, has the capacity to expand to 400 GWh, which would require several billion dollars of additional investment, a company official said.
The Ridgefield facility is expected to supply battery materials to Ford Motor (NYSE:F) and SK On in Kentucky, Toyota Motor (NYSE:TM) in North Carolina and Volvo and Envision AESC in South Carolina.
South Carolina already is home to vehicle manufacturers BMW in Greer, Mercedes-Benz Vans in North Charleston, Arrival in Rock Hill and Proterra in Greenville and Greer.
Volvo is building a battery plant next to its assembly facility in Ridgeville and BMW is partnering with Envision AESC on a $700 million battery plant in Woodruff.
A second North American “battery belt” is springing up in Canada, in Becancour, Quebec, on the St. Lawrence River.
Among the companies planning or considering investments in battery material refining and manufacturing facilities there are General Motors (NYSE:GM), Ford and Volkswagen (ETR:VOWG_p), as well as suppliers SK, BASF and Posco Chemical and mining/refining companies Umicore and Nouveau Monde.
