Li-Cycle powers down

TECH

Li-Cycle Powers Down

What happened: Li-Cycle filed for bankruptcy after failing to secure the capital needed to keep its battery recycling business going.

The company needed to raise $262.7 million to unlock the next advance from its $475 million loan from the US Dept of Energy. 

The tech: Li-Cycle’s model processed end-of-life lithium-ion batteries at regional “spoke” plants, where they were shredded into black mass, a mix of various materials. 

The black mass was then refined into battery-grade lithium, nickel and cobalt at central Hubs like its planned Rochester plant, where it could then re-enter the supply chain. 

Challenges: Li-Cycle was a Canadian anchor in the emerging battery ecosystem, with plants in North America, Asia, and Europe, but ran into a number of challenges over the past two years:

• Costs to build their Hub processing plant in Rochester, NY increased rapidly and significantly, leading to stalled construction and lawsuits from contractors

• Spoke plants couldn’t turn a profit due to feedstock prices and lower prices for commodities like nickel and cobalt

Why it matters: Li-Cycle’s collapse could shake investor confidence in the EV space just as Canada is moving to build out domestic capacity. And Li-Cycle isn’t the only one struggling in the EV value chain:

• Northvolt went bankrupt, leaving the future of its Quebec plant up in the air

• Lion Electric also filed for bankruptcy (but will return with a new ownership group and narrower focus on electric buses)

• Honda is pausing a massive $15B EV project in Ontario, following cancellations and pauses from Ford, Umicore and E-One Moli

Add in new US tariffs, shifting government policy, competition from Chinese car makers, and uncertain consumer demand, and it’s a pivotal period for the EV sector. 

Yes, but: Momentum hasn’t stalled everywhere and some players are adapting and advancing:

• Cyclic Materials recently raised an oversubscribed Series B to expand rare earth recycling

• Volkswagen-backed PowerCo is pushing ahead with its $7B Ontario gigafactory

• Winnipeg’s NFI Group continues to grow electric bus production

• Neo Battery Materials and others are building out battery material refineries and production plants in Ontario

The bottom line: Building out this new industry will require time - and some failures along the way. But with EV sales climbing ~20% annually and the IEA forecasting those numbers to start suppressing oil demand, the long-term trend is intact.

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CLIMATE CAPITAL

🌳 veritree (Vancouver, BC) raised $9.1 milion in Series A funding led by Pender Ventures and Diagram for its nature restoration tech. A spinout from clothing brand Tentree, veritree helps businesses support nature restoration projects with transparency and monitoring to avoid greenwashing.

🌱 Freshr closed an oversubscribed seed round for an undisclosed amount for its sustainable packaging. Freshr is developing coatings for packaging that are made from naturally derived ingredients, extend shelf life, and minimize food waste.

🚜 Verdi (Vancouver, BC) secured $6.5 million in seed funding led by US-based SVG Ventures to enhance farm irrigation systems. Verdi uses automation and digital tools to improve climate resilience and efficiency in agriculture.

🔌 Voltra (Waterloo, ON) closed a $1.8 million pre-seed led by Contrary Capital for its EV charging software. Voltra’s platform, Charge, offers a single platform to software developers working in EV charging across fleets, multi-unit buildings, and microgrids.

⛏️ Ucore (Halifax, NS) will receive US$18.4 million from the US Department of Defence to build a critical minerals refinery in Louisiana. Ucore’s technology separates critical minerals faster and more efficiently than conventional methods.

💰️ Redstick Ventures closed a $6.5 million first fund to invest in early-stage foodtech. The US- and Canada-based fund will focus on improving crop yields, reducing food waste, and automation.

IN THE FIELD

🏭️ Svante launched the world’s first gigafactory for commercial-scale carbon capture and removal filters in Burnaby, BC. The plant will produce enough filters to capture up to 10 million tonnes of CO2 annually

⏱️ Clockwork launched its Reliability Index, a comprehensive metric for EV charging operators to manage site performance.

🚌 A group of Quebec-based investors will buy electric bus maker Lion Electric. The deal will see Quebec renew its subsidy program for electric buses.

🔌 Hypercharge launched a new Level 2 charger tailored for multi-unit residential and commercial buildings.

🔋 Battery X Metals partnered with EV dealer Factor E Motors to roll out their lithium-ion battery rebalancing software and hardware.

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NEWS

📡 Signals & Currents

Ontario to kill municipal green building standards: A new bill aimed at speeding up home construction would eliminate green municipal building codes like the Toronto Green Standard. Developers claim the standards slow projects down and increase costs.

The standards set performance expectations for new buildings like energy efficiency, embodied carbon, or waste diversion.

Canadian institutional investors back sustainable finance - New industry group will offer guidance, business strategy for climate risk and the energy transition.

Brazil signs $1B SAF deal with China - The sugarcane-based fuel project is part of growing ties between China and South America.

US budget bill to gut clean energy investment - The IRA rollback will also raise energy costs for most Americans.

Hungary is now the world’s solar leader - Solar generation went from 2% to 25% in just six years.

UK takes on public energy projects - Great British Energy will invest with private sector to deploy clean energy projects.

EU and UK to link carbon markets - A linked Carbon Border Adjustment will follow a year later.

Edison plans $6.2B fire prevention program after LA Fires - Efforts include burying lines and fire suppression.

COMMUNITY

🗓️ Turning Food Waste into Value: Join me for an in-depth discussion with FoodCycle CEO, Bradley Crepeau, on building circular food systems. May 29th, Ottawa.

🗓️ Climate Global 2025 @ WebSummit Vancouver: Kick off Web Summit with a high-impact, one-day event connecting startups, investors, and industry leaders in climate technology. May 26th, Vancouver.

➡️ Discover more climate events.

🧑🏻‍💻 Veritree is hiring a Product Marketing Manager to launch new products, features, and planting projects on their mission to plant 1 billion verified trees by 2030.

➡️ Find more open roles.