Old EV batteries now power an AI data center: Redwood and Crusoe's 63-MWh microgrid

SPARKS, Nev., June 2025 — Redwood Materials launched Redwood Energy with a microgrid of repurposed EV batteries and solar that powers a Crusoe modular AI data center off the grid. Here's what happened, what it cost, and what went wrong.

Cost and outcome (as of June 26, 2025)

Outcome: a 12 MW, 63 MWh second-life battery microgrid running a Crusoe data center. (Crusoe release)
Hardware: 805 retired EV batteries beside a solar array. (TechCrunch)
Build time: four months, Straubel said. (TechCrunch)
Cost: not disclosed. Straubel told TechCrunch it earns revenue and is profitable; that is his claim. (TechCrunch)
Status: operating at launch, per both companies.

What they built

Redwood and Crusoe called the system "the largest second-life battery deployment in the world and the largest microgrid in North America." Those are their own titles. (Crusoe release)

The packs are "depreciated but functional," with most of their capacity left, and are repurposed before recycling, said JB Straubel, Redwood's founder and CEO. "We can stand up dependable power wherever new compute is needed, without waiting years for new grid capacity." (Crusoe release)

Crusoe used the site to introduce Crusoe Spark, a portable unit bundling power, cooling and GPU-ready racks. CEO Chase Lochmiller called it "the first of many such deployments." (Crusoe release)

Who Redwood is

Straubel, Tesla's former CTO and a current Tesla board member, founded Redwood in 2017 to build a circular battery supply chain. It began by recycling cell-production scrap and consumer electronics, extracting cobalt, nickel and lithium for Panasonic and other customers, and has since moved into cathode production, with deals with Toyota, Panasonic and GM. (TechCrunch)

Redwood Energy isn't tied to off-grid use: the packs can be charged from wind or solar or tied to the grid, TechCrunch reported. At Sparks, solar does the charging, and everything at the launch event, down to a laser light show, ran on the microgrid. (TechCrunch)

Crusoe is best known for its 1.2-gigawatt campus in Abilene, Texas, its release says. (Crusoe release)

Why Redwood is doing it

Crusoe's release says Redwood processes 20 GWh of batteries a year, the equivalent of 250,000 EVs. (Crusoe release) TechCrunch reported Redwood had more than 1 GWh of packs not yet ready for recycling in inventory, expected another 4 GWh in the coming months, and planned to deploy 20 GWh of grid-scale storage by 2028. (TechCrunch)

Straubel said the microgrid "is not a demonstration project" but a revenue-generating operation, and that "this has the potential to grow faster than the core recycling business." (TechCrunch)

"There's no green intent required here," said CTO Colin Campbell. "It's a good economic choice that also happens to be carbon-free." (TechCrunch)

An outside view

"This really demonstrates how economical the waste hierarchy actually is," Jessica Dunn, a battery expert at the Union of Concerned Scientists, told TechCrunch. She also noted the business logic: without repurposing, Redwood would wait "five, 10, 15 years" for packs to retire while rivals sold them for storage. (TechCrunch)

TechCrunch noted that companies have promised grid-scale storage from used EV batteries for over a decade, but it has only materialized in small amounts. (TechCrunch)

The timing problem

The wave of retired EV batteries Redwood was founded to handle "hasn't materialized quite as quickly as some predicted," TechCrunch reported. "We started Redwood almost too early," Straubel said. (TechCrunch)

What went wrong

Self-awarded records. "Largest" claims come from the companies, not an independent tally. (Crusoe release)
Unverified economics. Profitability is Straubel's word; no figures were given. (TechCrunch)
Feedstock is late. Retired EV packs are arriving more slowly than predicted. (TechCrunch)
What we don't know yet: the project's cost, how the aged packs degrade in service, and how the 2028 storage plan is tracking.

Our follow-up question for Redwood Materials

How much second-life storage has Redwood Energy deployed since June 2025, and how have the Sparks packs held capacity?

Sources

Crusoe, “Crusoe and Redwood Materials unveil world's largest second-life battery deployment, powering the future of AI, with repurposed EV batteries,” June 26, 2025. crusoe.ai
TechCrunch, “Redwood Materials launches energy storage business and its first target is AI data centers,” June 26, 2025. techcrunch.com

Disclosure: [not in copy] Editor placeholder