Solterra is turning America’s scrap aluminum problem into cash

When it comes to recycling, few materials can match aluminum. Because aluminum can be reused many times and requires much less energy, recycling is often cheaper than producing new aluminum. However, only about one-third of the aluminum used in the United States is recycled.

The problem lies in sorting mixed aluminum scrap, a challenge that has long plagued the recycling industry.

But Sortera CEO Michael Siemer believes his company has found the key. Sortera says it has developed a system that can separate grades of aluminum with more than 95% accuracy. This is a breakthrough achievement that will unlock a huge untapped resource in the recycling industry.

Here’s how it works: The company uses an AI model to identify different grades of aluminum based on data from lasers, X-ray fluorescence, and high-speed cameras. The system must classify each chip, which is about the size of a large potato chip, in a fraction of a second. “Ten milliseconds is a long time,” Seamer said. Once the vision system identifies the grade, a series of nozzles sprays precise air to flick the chips off the belt and into the correct bin.

In other recycling operations, speed and precision are important because the aluminum must first be melted before the alloy type can be determined. Also, if the alloy is not properly sorted, the value of the mixed heap is significantly reduced because the customer cannot be confident that it has the required properties.

“People have been following suit. [this unsorted aluminum]And no one could unlock it,” Seamer said.

Sortera’s classification accuracy further helped the company unlock another thing that many startups seek: profitability. “Margins increase exponentially above 90%. [while] 92% gives you a small margin and 95% gives you a big margin. [and] 98% is a really big difference. ”

That has put the company in positive cash flow since August, he said, all based on operations at a single plant in Indiana. To build a second factory in Tennessee, Solterra recently raised $20 million in equity and $25 million in debt in a round led by accounts advised by VXI Capital and T. Rowe Price, with participation from Overlay Capital and Yamaha Motor Ventures, the company exclusively tells TechCrunch. Trinity Capital is providing additional capital funding.

The new factory is under construction near Nashville and is expected to be operational in April or May. “This is a replica of our Indiana factory,” Seamer said. At the Indiana facility, “we operate at full capacity 24 hours a day, 365 days a year, and we generate millions of pounds a month,” he says.

So where does that aluminum come from? The scrap aluminum that Sortera receives tends to come from shredded cars. Different grades of aluminum break in different ways when shredded, and these visual differences help AI classify the metal. “The chemical differences show up during shredding,” says Seamer. Different alloys create unique cracks and creases that give clues to the system. “By getting these little insights, you can think, ‘This is definitely 356 hours,’ in a time frame of about 10 milliseconds. [grade aluminum]” says Seamer.

As Sortera expands, much of its aluminum will eventually end up back on the car assembly line. Automakers are increasing their use of metals to reduce vehicle weight and improve fuel efficiency. “Every automotive OEM on the planet has probably visited Indiana at least twice,” Seamer said.

Sortera is currently working on ways to process other metals such as copper and titanium, but for the foreseeable future the company will continue to focus on aluminum. “We can instantly sift through the 18 billion tons of aluminum produced in the United States annually. Every inch of it, every pound of it, will be sold at a profit in the United States.”