Aqua Metals Inc (NASDAQ:AQMS) CEO Steve Cotton talked with Proactive about the company’s efforts to innovate clean recycling solutions for lithium-ion batteries.
Cotton highlighted how Aqua Metals has developed a fully electrified recycling process that reduces carbon emissions and waste, making it more economical compared to traditional methods.
Proactive: Can you give us some background on Aqua Metals?
Steve Cotton: Aqua Metals is innovating a clean way to recycle lithium-ion batteries, doing so without producing large amounts of carbon dioxide—often multiple times the weight of the batteries themselves. We've developed a fully electrified process that can utilize renewable energy, effectively decarbonizing the recycling process.
Additionally, our process significantly reduces carbon emissions and solid waste streams, such as sodium sulfate, which typically outweighs the batteries on the back end. We can also do this more economically, as our conversion costs are lower than other methodologies. So, we've achieved a decarbonized, safe work environment with the best economics.
Who would be the primary beneficiaries of this facility? Who are the people or organizations you'd be serving?
In general, a lot of lithium batteries are already being collected, crushed, and de-energized, producing a material called "Black Mass," which contains lithium, nickel, and cobalt. This Black Mass can be sourced from the open market. On the back end of our process, our products—cobalt and nickel in metal form (unique to us), and lithium in the form of lithium carbonate—can re-enter the battery supply chain.
Beyond that, major OEMs (original equipment manufacturers), including both battery and vehicle manufacturers, are very interested in closing the loop. This involves managing materials at their end of life or at the production scrap level, ensuring that all these materials are reintegrated into the ecosystem in a clean way, with a path to net zero and better economics.
We see opportunities both in the general market and in collaborating with OEMs committed to achieving net zero with the right economic approach.
You recently provided an update on the significant progress made at your production facility. Could you tell us where the facility currently stands and the status of the construction?
We've already built and have been operating our pilot facility at the Tahoe Reno Industrial Center, about 30 minutes east of our headquarters here in South Reno. This pilot operation, which we refer to as our Innovation Center, has been running for up to 24 hours a day, five days a week, for nearly a year. It's been instrumental in proving our technology, validating our processes, and producing material.
We've been less focused on revenue at this stage and more on getting these materials into the hands of major OEMs for sampling and qualification as we construct our commercial-scale Phase One facility. This facility, called the Sierra Arc (Aqua Refining and Recycling Center), is just a two-minute drive from our Innovation Center at the Tahoe Reno Industrial Center.
We've purchased the land and an existing building, which is now nearly complete. We've started installing equipment, with the goal of finishing the build-out and commissioning the facility by early next year, aiming to produce truckload quantities of these materials at a commercial scale.
So, with the focus now on getting the facility up and running, are you also exploring deals with car manufacturers and other potential partners? Is that something planned for the near future?
Yes, we are very actively involved in this area. We’ve provided samples of lithium, nickel, and cobalt directly and through our partner, 6K Energy, which is a privately held company specializing in cathode active materials. These materials are used in the automotive and battery manufacturing sectors. We’ve been actively seeding the market with these samples.
As we move to producing truckload quantities with our commercial production, we anticipate forming more partnerships and alliances, which we plan to announce in the near future.
Considering the evolution of cars from their inception to their end-of-life stages, it seems there's significant potential for your work, especially in the U.S. Could you elaborate on this opportunity?
Oh, definitely. For example, battery production in the U.S. has significantly increased. Initially, the first Tesla Gigafactory near our Tahoe Reno Industrial facility had a capacity of 0.05 terawatt hours. By the end of this decade, it's projected to reach 1.2 terawatt hours. This expansion will generate a substantial amount of scrap material that needs recycling, along with end-of-life materials from batteries used in consumer devices, lawn and garden equipment, golf carts, and EVs.
We see a huge opportunity to be part of this growing industry. By the end of the decade, approximately a million tons of black mass will need recycling. Even with the large capacities announced, including ours with Phase One and Phase Two of our commercial facility, there will be more material to recycle than available recycling capacity.
We’re excited about the opportunities in the latter half of this decade as we establish our facility and contribute to building this industry in North America.
Quotes have been lightly edited for clarity and style