Funding to support New York facility to recycle critical battery materials.

Amid rising demand for domestic battery recycling solutions, Li-Cycle Holdings Corp. has secured a landmark $475 million loan from the U.S. Department of Energy to advance the development of its Rochester Hub project, a facility poised to become North America's first commercial-scale hydrometallurgical battery materials recovery center.

Over the past few years, Li-Cycle has emerged as a leader in lithium-ion battery recycling, leveraging its innovative spoke-and-hub model to recover critical materials like lithium, nickel, and cobalt from end-of-life batteries.

This two-step system ensures battery materials are processed locally at distributed spoke facilities before being sent to centralized hubs for refining, creating a sustainable and circular supply chain tailored to meet the growing demands of the clean energy transition.

With this model, Li-Cycle has steadily built a network of spoke facilities across North America and Europe, achieving a processing capacity of over 50,000 metric tons of lithium-ion battery material annually.

This expansion includes the establishment of facilities in Ontario, New York, Arizona, and Alabama, as well as the launch of its first European spoke in Germany, one of the largest facilities of its kind on the continent.

Additionally, a partnership with Glencore has propelled plans for a major recycling hub in Portovesme, Italy, while Li-Cycle's collaboration with KION Group, Europe's largest industrial truck manufacturer, is advancing the development of a new facility in France.

These infrastructure developments have been bolstered by significant financial backing. Beginning with a $200 million investment from Glencore in 2022, securing a reliable feedstock supply, establishing long-term offtake agreements, and providing a solid foundation for Li-Cycle's ambitious growth strategy.

This partnership deepened further with an additional $75 million investment from Glencore in 2024, aimed at enhancing the company's liquidity and operational resilience.

Meanwhile, a $375 million conditional commitment from the U.S. Department of Energy has been upsized to a finalized $475 million loan agreement, marking a major milestone in federal support for sustainable battery recycling.

Together, these investments underscore growing confidence in Li-Cycle's ability to meet the rising demand for critical battery materials while advancing its vision of a circular and sustainable supply chain on a global scale.

This loan from the U.S. Department of Energy's Advanced Technology Vehicles Manufacturing program represents a pivotal development for Li-Cycle. Not only does it provide critical financial support for the Rochester Hub project, but it also marks the first DOE loan to back a lithium-ion battery recycling company – a milestone that underscores the importance of Li-Cycle's role in the domestic battery materials supply chain.

"Throughout 2024, one of Li-Cycle's primary objectives has been to finalize negotiations with the DOE in order to enter into definitive documentation to obtain a DOE loan," said Li-Cycle President and CEO Ajay Kochhar. "Today, we are excited to announce our achievement of this significant milestone, which we believe represents a strong vote of confidence in Li-Cycle's patented and environmentally friendly recycling technology and business model. Securing the DOE Loan Facility through our close collaboration with the DOE is a critical step toward our goal of restarting construction at the Rochester Hub project."

Li-Cycle Holdings Corp.

The Rochester Hub will be capable of processing up to 35,000 metric tons of black mass annually, producing approximately 8,250 metric tons of lithium carbonate and 72,000 metric tons of mixed hydroxide precipitate to support the growing demand for critical battery materials.

The loan arrives at a critical juncture, following earlier setbacks in the Rochester Hub's development, including escalating costs that nearly doubled initial estimates and prompted a pause in construction in late 2023.

Designed to process up to 35,000 metric tons of black mass annually, the Rochester Hub is also expected to produce approximately 8,250 metric tons of battery-grade lithium carbonate and up to 72,000 metric tons of mixed hydroxide precipitate – a blend of nickel, cobalt, and manganese critical for next-generation batteries.

The facility is also expected to create 825 construction jobs at its peak and more than 200 permanent roles once operational, further cementing its significance as a cornerstone of North America's clean energy transition.

According to Li-Cycle, the loan terms include a 15-year maturity with favorable interest rates fixed at long-dated U.S. Treasury rates. The agreement allows for capitalized interest during the construction period and a grace period on principal repayments until mid-2027, providing the financial flexibility needed to ensure the project's timely completion.

"We believe that the DOE Loan Facility offers attractive terms relative to other third-party financing alternatives available to us," said Kochhar. "We believe it will also enhance our financial flexibility and support our mission to create a sustainable, closed-loop battery supply chain, which is vital to the electrification transition and securing energy independence in North America."