A recycling startup joins the AI boom - marketplace-tech Recap

Podcast: marketplace-tech

Published: 2026-01-29

Duration: 4 minutes

Guests: Colin Campbell

Summary

Redwood Materials, an EV battery recycling startup, is expanding into providing off-grid renewable energy solutions for AI data centers to meet the fast-growing demand for power.

What Happened

Megan McCarty Carino visits Redwood Material's new R&D lab in San Francisco, where she explores the company's role in the current AI boom. Redwood Materials, primarily known for recycling EV batteries, is now venturing into providing energy storage solutions for AI data centers. Colin Campbell, CTO of Redwood Materials, explains that AI companies are in a race to secure power, often facing resistance from communities concerned about rising electricity costs.

The company has efficiently built a 60 megawatt-hour battery storage system in Nevada to power a data center disconnected from the grid. This project, completed in just four months, highlights the speed and efficiency of using recycled EV batteries for energy storage compared to traditional grid connections or natural gas turbines.

Despite the significant push from AI data centers, Campbell assures that Redwood's business model remains viable even without the AI surge. The company can still sell grid-scale energy storage to other sectors, albeit at a slower pace.

Investment from NVIDIA, a major chipmaker, is set to propel Redwood Materials towards mass-producing batteries at an industrial scale in Nevada. This collaboration is expected to yield a 10-gigawatt per year manufacturing line, supporting both AI data centers and broader energy storage needs.

Campbell emphasizes the importance of being a first mover in the energy storage market, particularly as AI companies demand rapid power solutions. He suggests that the AI boom is accelerating the timeline for deploying renewable energy coupled with battery storage.

The episode concludes with a mention of the upcoming discussion on the long-term cycles of tech booms and busts, hinting at the broader context of Redwood Materials' expansion during this peak in AI demand.

Key Insights

• Redwood Materials has constructed a 60 megawatt-hour battery storage system in Nevada, enabling a data center to operate independently from the grid. This project was completed in just four months using recycled EV batteries, offering a faster alternative to traditional energy sources.
• Investment from NVIDIA is enabling Redwood Materials to scale up battery production, aiming for a 10-gigawatt per year manufacturing line in Nevada. This expansion will support both AI data centers and broader energy storage needs.
• AI companies are rapidly seeking power solutions, often encountering resistance from communities due to concerns over rising electricity costs. Redwood Materials is capitalizing on this demand by offering renewable energy storage solutions.
• Despite the AI boom, Redwood Materials' business model remains sustainable, with the ability to sell grid-scale energy storage to various sectors. This diversification ensures viability beyond the immediate demand from AI data centers.