Redwood Materials Secures $425 Million in Series E Funding Led by Google to Scale Battery Recycling and Storage Platform
January 29, 2026
Redwood Materials, a leading US-based battery recycling and materials manufacturer, has closed a significant $425 million Series E funding round, signaling strong investor confidence in sustainable supply chains for the energy transition. The round was backed by Google and included participation from Nvidia's venture capital arm, NVentures. This substantial capital injection underscores the growing strategic importance of securing domestic, circular sources for critical battery minerals amid soaring demand from electric vehicles and energy-intensive data centers.
The company, founded in 2017 by former Tesla CTO JB Straubel and headquartered in Carson City, Nevada, plans to use the proceeds to accelerate the growth of its energy storage platform while strengthening its integrated recycling operations. Redwood specializes in recycling end-of-life lithium-ion batteries to recover and refine key materials like lithium, nickel, cobalt, and copper back into battery-grade components, aiming to create a closed-loop supply chain.
A key strategic move came in June of last year with the launch of Redwood Energy, a new division focused on repurposing used electric vehicle batteries into large-scale energy storage systems. This initiative targets grid and industrial applications, with a particular emphasis on serving the power-hungry AI data center sector. As part of this launch, Redwood partnered with data center developer Crusoe, and the companies have already deployed a 12-megawatt, 63-gigawatt hour microgrid system at an undisclosed Crusoe AI data center site.
Google's investment is part of a broader trend of hyperscale data center operators seeking innovative, long-duration energy storage (LDES) solutions to manage power demands and sustainability goals. Last year, Google entered its first LDES partnership with CO2 battery developer Energy Dome and later joined a demonstration project with Arizona's Salt River Project. Other industry players are following suit; for instance, Prometheus Hyperscale signed a deal in May to deploy a demonstration-scale organic flow battery, with plans for commercial-scale 12.5MW/125MWh systems by 2028.
The funding round arrives at a critical juncture for the LDES sector, which faces both immense opportunity and significant challenges. While demand for reliable, clean backup power is skyrocketing, the market has seen setbacks, including the recent closure of sodium-ion battery firm Natron Energy due to funding difficulties. Redwood Materials' successful $425 million raise, backed by major tech giants, highlights a vote of confidence in its vertically integrated model to address both material scarcity and grid resilience needs simultaneously.
Source: datacenterdynamics
