The decision by Toronto-based battery recycler Li-Cycle to delay its new hub facility in Rochester, New York, is raising flags within the wider cleantech industry.
While engineering and procurement for the project are “largely complete,” the project has been hit with escalating construction costs, Li-Cycle announced in a release earlier this week. The company is planning a comprehensive review, ahead of an update in its third-quarter financial report in November.
The news has “rattled” stakeholders and onlookers who’ve hailed Li-Cycle as one of Canada’s big success stories, writes Globe and Mail cleantech columnist Adam Radwanski. The delay is being seen as an indicator of stiff headwinds facing Canada’s cleantech industry, even as momentum grows for an economy-wide energy transition.
“I was surprised by this news,” said Joanna Kyriazis, director of public affairs at Clean Energy Canada. “But we’ve been hearing consistently from the clean energy sector that this high-inflation, high-interest-rate environment is pushing projects off course.”
Li-Cycle’s share prices dropped more than 45% to US$1.23 when the news first broke on October 23, and then fell further to $1.07 soon after. According to Simply Wall St., the company has less than a year of cash and will need to raise capital or take on debt.
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