Li-Cycle Holdings Corp. and the US Department of Energy (DOE) Loan Programs Office (LPO), through its Advanced Technology Vehicles Manufacturing (ATVM) program, have entered into a conditional commitment for a $375-million loan. The conditional commitment follows DOE technical, market, financial and legal due diligence and marks another significant milestone endorsing Li-Cycle’s development of the first commercial hydrometallurgical resource recovery facility in North America, located near Rochester, New York.

This is the first conditional commitment from the DOE ATVM program for a sustainable pure-play battery materials recycling company and the program’s main support for the lithium-ion battery recycling industry.

The Rochester Hub is intended to become a significant domestic source of battery-grade materials, including lithium, nickel and cobalt, and will be the first-of-its-kind commercial facility in North America.

Receiving the conditional commitment is a significant step in the lending process and reflects the DOE’s intent to finance the project; however, the Loan remains subject to documentation of long-form agreements and certain conditions will have to be satisfied prior to closing, which is currently expected to occur in calendar Q2 2023.

The Loan will have a term of up to 12 years from financial close, and interest on the Loan will be the 10-year US Treasury Rates from the date of each advance for the Loan.

Li-Cycle’s Spoke & Hub business model is focused on a vertically-integrated two-step lithium-ion battery recycling and resource recovery process. This supports the building of localized supply chains for battery-grade materials to accelerate the clean energy transition. The company continues to scale its Spoke & Hub network to enable up to an overall 95% recycling efficiency rate.

The Spokes utilize the company’s technology to recycle end-of-life battery materials and manufacturing scrap, including directly processing full electric vehicle and energy storage battery packs through a submerged shredding process without any discharging or dismantling.

Currently, Li-Cycle has four operational Spokes in North America with total processing capacity of more than 50,000 tonnes of lithium-ion battery material per year. The Spokes produce an intermediate product called black mass, which contains a number of critical metals and will be sent to the Rochester Hub for further processing into battery-grade materials.

The Rochester Hub is intended to be the first commercial hydrometallurgical resource recovery facility in North America. The Rochester Hub’s hydrometallurgical process produces no wastewater discharge, minimal solid waste streams and relatively low air emissions.

The Rochester Hub is designed to have a processing capacity of up to 35,000 tonnes of black mass per year, which is equivalent to approximately 90,000 tonnes of lithium-ion battery material or 18 gigawatt-hours (GWh) of lithium-ion batteries. Once fully operational, the Rochester Hub is expected to deliver annual production of up to 8,500 tonnes of lithium carbonate, 48,000 tonnes of nickel sulfate, and 7,500 tonnes of cobalt sulfate.