The U.S. Department of Energy (DOE) finalized a $475 million loan for Li-Cycle Holdings on Thursday, supporting the Toronto-based recycler’s project to build a large-scale battery recycling facility in Rochester, New York. The loan, which is $100 million higher than the initial proposal last year, is aimed at helping the Glencore-backed firm expand its role in the battery supply chain for electric vehicles (EVs), a key component of President Joe Biden’s clean energy agenda.
“This loan demonstrates the Energy Department’s commitment to strengthening America’s national and energy security by supporting a robust domestic EV battery and critical materials supply chain,” said Jigar Shah, head of the DOE’s Loan Program Office. The Rochester facility, which will process lithium and other metals from used batteries, is expected to be one of the largest U.S. sources of battery-grade lithium.
The loan, set at $445 million in principal and $30 million in capitalized interest over a 15-year term, will allow Li-Cycle to pursue private investment to cover the remaining costs of its $960 million project. “The big task from here is to get private financing and build this facility,” said Li-Cycle CEO Ajay Kochhar. “We’re positive that we’re going to meet our end of the bargain, and we’re positive that the U.S. government is going to do the same.”
This support for Li-Cycle comes as the Biden administration expedites approvals for key mineral projects before President-elect Donald Trump assumes office in January. The facility, expected to produce 8,250 metric tons of lithium carbonate and 72,000 metric tons of mixed hydroxide precipitate annually, is anticipated to create 825 construction jobs and 200 permanent jobs upon completion. Glencore has committed to purchasing all mixed hydroxide output, further securing the DOEâs confidence in the project.
Senator Chuck Schumer, who has advocated for the project, welcomed the loan as a win for New York and a critical step towards developing a domestic battery recycling industry.