Battery Fires, Recycling, and the New Grid Supply Chain

Most people only hear about big batteries when something goes wrong—like the Moss Landing fire that took a 300MW storage facility offline and triggered a US$400 million write‑off. What almost no one talks about is what happens next.

Here’s the thing about green technology: it’s only truly “green” if we know how to build, operate, and retire it without leaving behind a mess of toxic waste and stranded assets. That’s where large‑scale lithium‑ion battery recycling and smarter use of data and automation start to really matter.

This post looks at two big moves in the US battery ecosystem:

• the US EPA appointing American Battery Technology Company (ABTC) to recycle up to 100,000 damaged Li‑ion modules from California’s Moss Landing site, and
• Redwood Materials ramping up a new battery recycling campus in South Carolina.

Both stories are about more than cleanup. They’re about building a domestic, closed‑loop supply chain for critical minerals—backed by automation, data, and AI—that can keep storage projects bankable, communities safe, and decarbonization on track.

Why Moss Landing’s Battery Fire Matters for Green Tech

The Moss Landing Energy Storage Facility fire didn’t just damage hardware; it rattled confidence in large‑scale battery energy storage systems (BESS).

A 300MW warning shot

Moss Landing in Monterey County is one of the largest battery installations in the world. When part of its 300MW system caught fire in January, it turned into a stress test for regulators, utilities, insurers, and local communities.

Key impacts:

• The owner, Vistra, wrote off roughly US$400 million in asset value.
• The US Environmental Protection Agency (EPA) stepped in and called the cleanup the largest Li‑ion battery removal operation in its history.
• California regulators tightened requirements for new BESS projects, with more scrutiny on fire safety, siting, and emergency response.

From a green technology perspective, Moss Landing is a blunt reminder: energy storage is essential to integrate solar, wind, and the explosion of AI data centers—but if fire risk and end‑of‑life management aren’t solved, projects stall or never get built.

Community trust is now a hard constraint

BESS opposition has sharpened around safety. During public meetings, the loudest objections usually aren’t about aesthetics or cost—they’re about:

• thermal runaway and fire spread
• toxic smoke and contamination
• long‑term environmental impact if batteries aren’t handled correctly

As Firetrace’s Joe DeBellis puts it, the industry’s job is to educate communities on safety technologies and risk management, not just show up with glossy project renderings.

If you’re developing or financing storage projects in 2025, you’re not just selling megawatt‑hours. You’re selling evidence that you can handle worst‑case scenarios responsibly—from early fire detection all the way through to recycling.

Inside the EPA–ABTC Partnership: From Hazard to Resource

The EPA’s decision to send up to 100,000 damaged battery modules from Moss Landing to ABTC is more than a logistics story. It’s a blueprint for what responsible, closed‑loop green technology can look like at grid scale.

How the cleanup actually works

The Moss Landing cleanup isn’t a bulk scrap job. Crews are going into the building and removing and discharging battery modules one by one. That matters, because the condition of the batteries is all over the map:

• some modules are intact but must be treated as hazardous
• others are severely compromised or partially burned
• a subset needs urgent processing to meet safety standards

Only materials suitable for recycling go to EPA‑approved facilities, including ABTC’s site in McCarran, Nevada. To get that approval, ABTC went through what it called an “arduous audit and review process” under CERCLA (the US Superfund law). Translation: regulators didn’t just take their word for it.

From a project‑developer or investor standpoint, that certification step matters. Facilities with CERCLA‑approved processes reduce long‑tail liability risk. That’s one reason serious storage players increasingly want to see named, vetted recycling partners baked into project plans from day one.

The economics: US$30 million in recovered value

ABTC estimates that recycling Moss Landing’s damaged batteries could generate about US$30 million in recovered products. That’s not just a nice sustainability talking point; it’s a meaningful financial offset.

Their recycling tech focuses on extracting:

• lithium
• cobalt
• nickel
• aluminum
• steel
• copper

These are the exact materials the US currently imports heavily from geopolitically sensitive regions. Every tonne recovered:

• reduces exposure to raw material price volatility
• shortens supply chains (and emissions) by keeping materials domestic
• turns waste into feedstock for new batteries or other industrial uses

This is where AI and automation quietly show up in green technology. Modern recyclers use:

• computer vision to identify cell types and damage patterns
• robotics to safely disassemble modules and packs
• data models to optimize process temperatures, reagent flows, and recovery rates

You won’t see “AI” splashed across the press releases, but under the hood, these plants run on software and sensing as much as they run on shredders and leach tanks.

Building a closed‑loop critical mineral supply chain

ABTC’s story is bigger than one cleanup. Founded in 2011, it secured financing in 2021 for a 20,000 tonne‑per‑year Li‑ion recycling pilot facility, then landed a US$57 million US Department of Energy grant in 2022.

That trajectory signals where policy is heading:

• The US is actively funding domestic recycling capacity as a strategic priority.
• Projects that align with that policy—by specifying domestic recyclers and re‑use plans—are likely to see smoother permitting and better access to incentives.

For businesses planning large battery deployments (EV fleets, data centers, industrial storage), the lesson is straightforward: design your recycling and reuse strategy into the project, not as an afterthought.

Redwood Materials and the Rise of the Domestic Battery Loop

While ABTC is handling a high‑profile cleanup, Redwood Materials is quietly stitching together a new kind of US‑based battery supply system.

Two campuses, most of North America’s used batteries

Redwood has been operating a major Nevada recycling campus and says that around 90% of all Li‑ion batteries processed in North America now pass through its facilities.

Now it’s adding a 600‑acre campus in Berkeley County, South Carolina, which will:

• increase annual materials production by 20,000 metric tonnes, and
• create an expected 1,500+ jobs in the next decade.

Redwood positions itself as:

• on par with the largest US nickel source
• the only domestic source of cobalt at scale
• one of the few new domestic sources of lithium and copper to launch in decades

That’s a huge shift. Instead of shipping scrap batteries across oceans and importing refined cathode materials back, the US can increasingly collect, refine, and redeploy those metals domestically.

Why AI data centers are suddenly a battery story

Redwood has been clear about something a lot of climate discussions miss: the AI boom is an energy storage story.

Large AI data centers need:

• ultra‑reliable power (grid outages are not an option)
• clean energy to keep emissions and ESG metrics under control
• on‑site or near‑site storage for resilience and grid services

Redwood isn’t just recycling; it’s building second‑life battery energy storage systems. One example this year: a 63MWh microgrid powering two data centers using repurposed batteries.

That’s the future of green technology in a nutshell:

• First life: EV or grid‑scale battery.
• Second life: stationary storage where weight and energy density matter less.
• Final life: recycling into new cells.

Each stage is increasingly orchestrated with data and AI—tracking battery health, predicting failure, scoring safety risk, and deciding which packs are better for reuse vs direct recycling.

Financing signals: US$350 million says this is real

In October, Redwood closed a US$350 million Series E round to expand its battery materials and energy storage business. Investors included:

• Eclipse (lead)
• NVentures, Nvidia’s venture arm

The Nvidia connection is telling. GPU‑driven AI workloads are hungry for power, and the companies building that future clearly see battery materials and storage as strategic infrastructure, not a niche side bet.

For developers and enterprise buyers, this is a good moment to rethink procurement strategy:

• Long‑term contracts for recycled or domestically sourced materials are becoming more available.
• Partnering with recyclers early can reduce lifecycle costs and improve ESG positioning.

What This Means for Developers, Utilities, and Climate‑Focused Businesses

If you’re building or relying on energy storage, three practical shifts are happening right now.

1. End‑of‑life is now a permitting and finance issue

Regulators and insurers increasingly want concrete answers to:

• Who takes ownership of batteries at end‑of‑life or after a failure?
• Which certified facility will process them?
• How will hazardous materials be handled and tracked?

Projects that show:

• named recycling partners (ABTC‑type facilities, Redwood‑type ecosystems)
• clear logistics plans, and
• alignment with domestic critical mineral goals

will generally find it easier to secure permits, community support, and capital.

2. AI and data are becoming non‑optional in storage risk management

From my perspective, the storage projects that will keep winning in 2025 and beyond are the ones that quietly embrace data and automation across the lifecycle:

• Design phase: simulation models to test thermal behavior and failure modes.
• Operations: AI‑driven anomaly detection on BMS data to catch cells before they cascade.
• Incidents: structured data capture from events like Moss Landing to refine safety standards.
• Recycling: computer‑vision‑guided disassembly, process optimization, and traceability.

That mix doesn’t just reduce risk; it creates a paper trail that regulators and communities can trust.

3. Circular supply chains are now a competitive advantage

Linear “take‑make‑waste” models for batteries are already obsolete. Companies that adopt circular strategies are seeing benefits across:

• Cost – recycled materials often buffer price spikes for mined metals.
• Time – domestic sourcing shortens lead times and reduces geopolitical exposure.
• ESG – lower lifecycle emissions and waste improve scores and disclosures.

If you’re planning large‑scale storage or EV fleets, here’s what I’d build into RFPs today:

• minimum recycled content for key materials (nickel, cobalt, lithium)
• proof of domestic processing where possible
• second‑life options before recycling
• digital tracking of packs and modules from commissioning to end‑of‑life

The reality? This is simpler than it sounds when you align early with the right partners.

Where Green Technology Goes Next

Battery fires like Moss Landing grab the headlines, but the quieter story—the one that will shape the next decade of green technology—is the rise of smart, domestic, circular battery systems.

ABTC’s work on the largest Li‑ion cleanup in EPA history and Redwood’s expansion into South Carolina both point in the same direction:

• energy storage is becoming safer and more accountable
• critical minerals are shifting from imported vulnerability to recycled resilience
• AI‑driven data and automation are the glue that holds complex lifecycle management together

If your business depends on clean energy, data centers, EVs, or grid resilience, now’s the moment to treat battery recycling and circular supply chains as core strategy, not a CSR line item.

Ask yourself: over the next ten years, do you want to be exposed to volatile global mineral markets and fire‑driven project delays, or plugged into a domestic, data‑rich, closed‑loop system that turns yesterday’s risk into tomorrow’s resource?

The companies that pick the second path won’t just be “greener.” They’ll be more resilient, more bankable, and better aligned with where policy and capital are already headed.