DOE gives loan to Li-Cycle's US battery resource recovery facility

The U.S. Department of Energy’s (DOE) Loan Programs Office (LPO) is giving a conditional commitment to Li-Cycle US Holdings Inc., a lithium-ion battery recycler based in Toronto, for a $375 million loan to help finance the construction of the first-of-its-kind lithium-ion battery resource recovery facility in North America.  

The department says if finalized, the loan will help Li-Cycle further expand its operations. The facility, located in Rochester, New York, is expected to support the battery needs of approximately 203,000 electric vehicles (EV) annually and will advance the electrification of the U.S. automotive fleet to lower related emissions, strengthen the domestic EV supply chain and create good-paying clean transportation jobs.   

Related: Li-Cycle reports earnings, Rochester facility updates

the DOE says EVs supported by the facility’s output would reduce gasoline use by about 80.6 million gallons annually. Once fully operational, the facility will create 270 jobs. 

“We are delighted to receive the first conditional commitment from the DOE LPO for a resource recovery facility, as it further supports our efforts to create a sustainable domestic supply chain of battery-grade materials in the U.S. and to grow American jobs,” says Ajay Kochhar, Li-Cycle co-founder, president and CEO. “The Rochester Hub is a cornerstone asset for Li-Cycle and its stakeholders and will be an important contributor to the clean energy economy. As a sustainable pure-play battery material recycling company, we expect the Rochester Hub will position Li-Cycle as a leading domestic producer of recycled battery-grade materials for accelerating electrification demand to address climate change and secure energy independence.” 

The Li-Cycle project will use hydrometallurgical recycling to recover battery-grade lithium carbonate, cobalt sulfate, nickel sulfate and other critical materials from manufacturing scrap materials and used batteries. The DOE says Li-Cycle’s hydrometallurgical process will recover these critical battery materials with high efficiency and with low energy use, operational costs and emissions. The final product will be a U.S.-made supply of battery-grade critical materials.   

The project has secured several supply agreements for recycled lithium-ion battery feedstock across the United States and Canada as the North American battery supply chain grows. As part of Li-Cycle's proprietary "Spoke & Hub Technologies" model, source materials will be aggregated and processed into black mass at four current operational sites throughout North America, including from Rochester; Gilbert, Arizona; Tuscaloosa, Alabama; and Kingston, Ontario, and shipped to the Rochester Hub facility for additional processing.   

Li-Cycle has commercial agreements in place with battery companies in the United States, like LG Energy Solution, for source materials as part of its efforts to enable a closed-loop supply chain for lithium-ion batteries and their component critical materials.   

While this conditional commitment demonstrates the department’s intent to finance the project, several steps remain for the project to reach critical milestones, and certain conditions must be satisfied before the department issues a final loan.