Charging The Green Revolution: The World’s Increasing Dependance On A Few Key Minerals
Given the enormous predicted increase in demand for the minerals required to power the clean energy revolution, you’d be forgiven for asking: Are we just trading one resource curse for another?
Written by Victoria Kent, Senior Investment Specialist
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Do you remember that rush of childhood excitement you felt when you received a Christmas present, only to experience the rapid and crushing anguish when you realised it needed batteries?
Remember that fleeting hope when you turned to your parent, who may have frantically rummaged in a cupboard or shoe box, only to produce one lonely AA when what you really needed a 9V and 7 AAAs.
We've always needed batteries, and we need them even more today. In our quest to reduce greenhouse gas emissions, it is clear the world needs to radically ramp up production of renewables – and this includes batteries.
As demand for batteries sees exponential growth and the world seeks zero-carbon energy, batteries are an essential component of our future.
In this article we delve into the world of batteries, revising some high school physics and chemistry, and find out how the space is evolving. We will also look at the minerals required to power these technologies, and the ethical issues in procuring some of them.
How does a battery work?
A battery is incredibly complex. In its simplest form, a battery consists of a cathode, anode, electrolyte, and separator. But there is a lot more going on under the surface. As the folks at Energizer put it, it's not exactly magic but it's close:
"A battery is like a small power plant that converts a chemical reaction into electrical energy."
Some of the many considerations of batteries are their cycle life, charge speed, safety, cost per kWh, heat and gravimetric energy density (how much energy a battery contains in proportion it its weight). Then there are the issues of lithium dendrite formation and cathode expansion and failure.
Each of these variables and issues will depend largely on a battery's composition, i.e. which minerals are used for which parts.
Minerals - the essential ingredients
Batteries and electric vehicles (EVs) require cobalt, lithium and nickel. Wind turbines require rare earth elements. Power transmission and distribution require aluminium and copper.
A clean energy transition sufficiently aggressive to hold warming below 1.5°C will bring about an enormous increase in demand for these minerals. As the International Energy Agency (IEA) states,
“A typical electric car requires six times the mineral inputs of a conventional car”.
Given the enormous predicted increase in demand for the minerals required to power the clean energy revolution, you'd be forgiven for asking: Are we just trading one resource curse for another?
Certainly, for those like clean energy guru David Roberts, this raises the question about the speed and sustainability of the clean energy transition. It’s a complicated subject — each of these minerals poses its own specific challenges, with its own specific suppliers, supply lines, customers and possible pain points.
Let's look at some of the main minerals used in batteries.
Note: metals are elements, whereas minerals are compounds of various elements. There is no lithium or cobalt metal sitting on the ground; the metals are held within minerals in the earth (like spodumene, petalite, and lepidolite). Along with those metals come other elements (e.g. Sulphur, which can make acid water).
Lithium
The price of lithium keeps rising as the world accelerates its electrification and decarbonisation efforts. It rose 7.5% in October alone, more than doubled this year, and now sells for almost 10 times the price it was just two years ago.
While it’s the 25th most abundant element in the Earth’s crust, and gigatons are dissolved into the oceans of the world, Hackaday explains,
“Lithium is very reactive and thus tends to be diffused, making it difficult to obtain concentrated in the quantities.”
The refining process depends a lot on the source minerals and desired end product, but for concentrated spodumene ore, the acids and bases involved can make it environmentally problematic. Other acid-free leaching processes have been developed as a result, which is said to be utilised by Tesla in their new lithium hydroxide plant being built next to company’s Texas Gigafactory.
Environmentally speaking, such plants are about as low-impact as lithium production can be. The geothermal DLE plant being built by the Australian company Controlled Thermal Resources is predicted to produce 68,000 tonnes of battery-grade lithium by 2027.
Cobalt
Cobalt is a metal expected to become one of the most important raw materials in our transition towards a low-carbon economy due to its use in rechargeable batteries and renewable energy technologies.
Cobalt is commonly used in electroplating because of its appearance, hardness, and resistance to oxidation. Current battery technologies require cobalt as part of the cathode. Given the growing popularity of electric vehicles, demand for cobalt continues to increase.
Unfortunately, nearly half of the global supply of cobalt is located in the geopolitically unstable democratic republic of Congo.
Distressingly, reports have found as many as 255,000 artisanal cobalt miners in the [Democratic Republic of Congo], 35,000 of whom are children working in exceedingly harsh and hazardous conditions. Tesla partly aimed to fix this by using less or no cobalt.
Fun fact: Australia boasts the world's second-largest cobalt reserves; a key opportunity for us if the world is serious about accessing ethically-sourced cobalt.
The importance of copper
Copper is also key to the infrastructure that transports renewable energy, thanks in part to its electrical conductivity and low reactivity. Its uses include cables, batteries, wiring, transistors and inverters.
EVs, solar and wind power, and batteries for energy storage all run on copper. An EV requires 2.5 times as much copper as an internal combustion engine vehicle, according to S&P Global. A pure electric vehicle can contain more than a mile of copper wiring in its stator windings.
Demand for copper is booming but supply can't keep up, jeopardizing net-zero emissions targets. S&P Global’s new report forecasts copper demand nearly doubling by 2035.
The world's copper supply chain is highly concentrated, with most of it coming from Chile, Peru and China. Getting more copper is not as simple as building new mines. A new copper mine takes 16 years, on average, to get off the ground, according to the International Energy Agency.
Recently, mining company Glencore was forced into suspending operations at its Antapaccay copper mine in Peru. That followed a third attack on the site by protesters in the space of a week, with growing unrest spreading across the South American nation.
Although the situation was brought under control, Peru is the world’s second largest copper producer, and volatility across the country threatens to crimp supply and impact copper prices for the likes of Sandfire Resources (ASX: SFR) and South32 (ASX: S32).
To limit global temperature rises to 1.5°C above preindustrial levels, the world must cut greenhouse gas emissions in half by 2030 and reach net-zero emissions by 2050. To do that, it must radically ramp up production of solar panels, wind turbines, batteries, electric vehicles, electrolysers for hydrogen, and power lines.
Those technologies are far more mineral-intensive than the equivalent fossil fuel technologies, and these minerals are often difficult to obtain or in short supply. Clearly, our reliance on the earth's resources is not lessening.