THE OTHER OPPORTUNITY
Miners have another way to speed the transition to renewables
Most of the discussion around mining and climate change centers on how mining companies can reduce their own carbon footprints and dependence on fossil fuels. Understandably, many miners view this issue in terms of costs. It is neither easy nor inexpensive to quickly shift away from legacy power technologies. However, this is not the only climate-change imperative where miners can play a constructive role. In fact, there is another equally compelling and potentially more lucrative opportunity that is often overlooked.
A recent article in the American political journal, Politico, spotlights the essential contribution miners make to the renewables industry. They provide many of the raw materials, like lithium, graphite, cobalt neodymium, and other minerals used to produce batteries, solar panels, wind turbines, and other key components of renewable energy technologies. Well, at least miners in China do.
According to Politico, many of these materials are overwhelmingly produced in China. “Rising tensions with Beijing and growing global demand for battery-powered electric vehicles are now setting off a quest for a new form of energy independence.”
The article quotes US Senator Lisa Murkowski (R-Alaska), chair of the Senate Committee on Energy and Natural Resources, as saying, “Not since it endured an economy-crushing oil embargo by petroleum producers in the 1970s has America been so vulnerable to foreign suppliers of a critical energy commodity”
Murkowski has been pushing legislation to boost domestic mining of minerals, metals, and rare earths. Likewise, policymakers in Europe, Canada and elsewhere are scrambling to reduce their reliance on China. “If you want to process lithium, we have to ship it all over to China and then get it back,” Maroš Šefčovič, vice president of the European Commission, told Politico. “(This is) not good for the carbon footprint and not [good] for our strategic autonomy,”
Enormous opportunities for mining companies
Šefčovič is also a founder of the European Battery Alliance, a consortium of government, industry and finance leaders from EU countries. In the EU, he said, “we are exploring the possibilities [of] which of the raw materials we can actually extract and process here in Europe … As production of electric vehicles accelerates, the EU’s demand for lithium is projected to increase sixtyfold by 2050, and cobalt, fifteenfold.”
To address that need, per Politico, the European Investment Bank is financing both extraction and mining as well as projects to refine and process lithium. In the US, the Pentagon is financing several projects to produce and process rare earth materials used to make armored vehicles, precision-guided weapons, batteries and night vision goggles.
The American Mineral Security Act, co-sponsored by Murkowski and Democratic Sen. Joe Manchin of West Virginia, would have required the federal government to identify deposits, expedite permitting, streamline regulatory processes and invest in research and training of workers with expertise in mineral exploration, manufacturing and recycling.
While the bill did not advance in the current session, President Donald Trump has signed several executive orders aimed at boosting domestic sources of minerals and rare earths, as well as agreements with Canada and Australia to collaborate on financing and production of minerals.
Politico quotes Canada’s ambassador to the United States, Kirsten Hillman, as saying, “The supply chains that we have are at risk. We’re facing a situation where the production and the processing of a number of critical minerals is highly concentrated in just one or two countries … Canada-U.S. cooperation is going to be part of the solution to diversifying our supply chains.”
“We have to, of course, participate in global commerce and the efficiencies of global supply chains,” said Hillman. “But we also have to balance that with ensuring that the supply chains that we have are with partners that we can trust and that we can rely on when the going gets tough.” Read the full article here.
2020 was a devastating year in so many ways. You, like us and so many others, were forced to change direction. Adapt.
This metamorphosis was unpredictable, unsettling, disruptive, and altering. And while we momentarily saw emissions go down, the year was more poignantly marked by other "milestones." The hottest year on record. Raging fires. Political disruption ...to name a few...
The tumult of 2020 almost mimics, to some degree, the history of the clean energy industry. Which is to say we in this field are familiar with **big** ups and downs over the decades.
However, and fortunately, 2021 onward predicts some Ups for our mission.
According to the International Energy Agency (IEA), renewable energy sources, collectively, are expected to be the main generators of electricity by 2025. Surpassing coal!
And according to BloombergNEF, "wind and solar [will] grow to meet 56% of world electricity demand in 2050."
We could go on! But for now, on a somewhat positive note, we're wishing you a Happy New Year as we look forward to leaving behind what we needn't carry with us.