AI data center developer Crusoe has partnered with battery recycling firm Redwood Energy to develop a microgrid system powered through solar and repurposed electric vehicle (EV) batteries for modular AI data centers.

The companies claim that the project is the largest microgrid in the North American market and will enable the deployment of mobile and scalable AI data centers that operate completely off-grid.

“Redwood Energy’s technology allows us to repurpose depreciated but functional EV battery packs, before recycling, into stationary storage. By putting these systems to work in high-demand applications like AI, we’re building energy infrastructure that’s faster, cleaner, and at lower cost,” said JB Straubel, founder and CEO of Redwood Materials.

The companies have already deployed the 12MW/63GWh microgrid at an undisclosed Crusoe AI data center, where Crusoe is pioneering its Spark modular AI data center solution.

Crusoe Spark integrates a data center critical infrastructure, including cooling, power, and GPU-ready racks, into a single unit, optimized for AI compute. The system is designed for rapid deployments and can be scaled due to its modular nature.

According to Crusoe, the solution is ideal for ranging applications, such as delivering low-latency AI inference services at the edge without the site constraints of larger-scale AI infrastructure.

“By leveraging Redwood's revolutionary recycled battery systems with a solar array to power Crusoe Spark units, we've demonstrated how you can quickly deploy the energy and data center needs required to meet the demand of AI in a cost-effective and sustainably powered way," said Chase Lochmiller, CEO and co-founder of Crusoe.

DCD has reached out for further information.

Lochmiller said he expects the microgrid to be “the first of many such deployments, and a prime example of Crusoe's energy-first approach to AI infrastructure from the ground up."

Redwood Energy is a subsidiary of Redwood Materials, which was founded in 2017 with a focus on building a circular supply chain for electric vehicle batteries.

Redwood currently processes 20GWh of second-life EV batteries annually, representing around 90 percent of all lithium-ion batteries in the North American market. Most of the batteries are repurposed into second-life energy storage systems, enhancing circularity across the battery supply chain.

Founded in 2018, Crusoe initially focused on developing cryptomining facilities, successfully developing more than 250MW of capacity across seven US states. However, in recent years, the company has pivoted towards AI and cloud data center developments. In March, the company exited the crypto space after selling its Bitcoin operations to NYDIG.

The company is now best known as the developer of OpenAI's Stargate data center campus in Abilene, Texas. In May, Crusoe secured $11.6 billion in debt and equity for the site’s development. The campus is the flagship site for OpenAI's Stargate effort, a $500bn project to build a series of large data centers across the US market.

Construction on the first phase of the project commenced in June 2024 and will comprise two buildings and more than 200MW of capacity. Construction of the second phase, consisting of six more buildings and another gigawatt of capacity, began in March 2025.