Nvidia has joined Redwood Materials’ latest funding round.
Today, the energy storage and battery recycling company announced it has closed a $350 million Series E funding round. The oversubscribed round was led by venture capital firm Eclipse, with participation from new investors including NVentures, Nvidia’s venture capital arm.
Redwood is the latest of a handful of energy companies NVentures has invested in, including nuclear companies Commonwealth Fusion and TerraPower, and load flexibility platform Emerald AI.
Nvidia’s involvement is evidence of the deepening ties between the artificial intelligence and energy companies, many of which are honing their strategies to cater to the power needs of AI — and raking in capital because of it.
An Nvidia spokesperson declined to comment on the deal.
When Redwood raised its previous funding round, a $1 billion Series D in September 2023, the company announced it was “expanding the domestic battery supply chain” and providing the market with “battery materials made in the U.S. for the first time.” Now, the company says it will use the capital to accelerate the expansion of its own energy storage deployments.
The news comes just a couple of months after Redwood announced Redwood Energy, a new business line using repurposed EV battery packs for large-scale energy storage. In June, it brought online its first project: 63 megawatt-hours of second-life battery packs supporting a first-of-a-kind, off-grid modular data center for AI workloads developed by Crusoe. (Crusoe is also reportedly backed by NVentures, among many other investors.)
Today’s press release notes that the Redwood Energy energy storage system is “designed to power data centers.”
“Electric energy availability has become a key strategic issue for AI infrastructure growth,” the announcement continues. “Large-scale battery energy storage has emerged as the most immediate…solution to enable AI factory deployment.”
The debut into energy storage was a significant expansion of Redwood’s business model, which had so far focused mostly on supplying battery materials back into the EV manufacturing supply chain. It was the result of an increase in the availability of used EV batteries, Redwood CTO Colin Campbell told Latitude Media in July, especially when paired with Redwood’s development of a cheap way of repurposing them for the grid.
The shift was also a reflection of the data center sector’s urgent need for energy and storage solutions. A few weeks after the announcement, for example, automaker General Motors announced its own agreement with Redwood Materials to develop grid-scale energy storage using some of the new and repurposed batteries originally meant for its electric vehicles.
Redwood’s business model expansion seems to be paying off: The latest funding round puts Redwood’s valuation at more than $6 billion, Bloomberg reported, which is notable in battery recycling, an industry that has so far struggled to really scale.
