The greening of the global economy leads to dependence on critical minerals

After nearly a century of geopolitical tensions over access to oil, experts fear that the global transition to clean energy is creating new dependencies on the critical minerals needed for solar panels, wind turbines and electric vehicle batteries.

Control over most of these essentials is concentrated in a handful of countries, none more so than China, they note.

Which metals are critical for the energy transition?

Cobalt, nickel, manganese and lithium are key to producing electric vehicle batteries. Rare earths such as neodymium, praseodymium and dysprosium are used in computer memory and magnets in wind turbines.

Copper and aluminum are used in power grids, and platinum is a catalyst for hydrogen.

These materials “will be at the heart of the economy’s decarbonisation and electrification efforts as we move from fossil fuels to wind and solar power generation, battery and fuel cell electric vehicles (EVs) and hydrogen production,” consulting firm McKinsey reported earlier this year.

How much demand is there?

According to estimates by the International Energy Agency (IEA), global demand for these critical metals could quadruple by 2040 if the world is to meet its commitments under the Paris climate pact.

The French researcher Olivier Vidal has calculated that by 2050 it will be necessary to produce more metals than humanity has produced throughout history.

While many predict shortages, some believe technological improvements and recycling will keep pace with increasing production needs.

But some regions are more vulnerable than others.

According to a study by the Belgian University of Leuven, Europe will face a severe shortage of metals, in particular lithium, cobalt, nickel, copper and rare earths, over the next 15 years.

The European Commodities Alliance (ERMA) says Europe will only be able to cover 5 to 55% of its key metal needs by 2030.

Although Europe has untapped resources of cobalt, gallium, germanium and lithium, it will have to issue mining permits to reach them, noted Bernd Schaefer, a senior ERMA official.

Industrial minerals producer Imerys has announced plans for a major lithium mine in central France.

The United States is opening its first cobalt mine in decades, in Idaho.

Car manufacturers such as Tesla have announced their intention to directly enter the capital of mining companies.

Which countries produce these metals?

Cobalt mining is dominated by the Democratic Republic of the Congo, which accounts for 70% of the world total. But in terms of processing, China is the leader, with 50 percent.

South Africa accounts for 37% of world manganese production.

China and Guinea account for more than half of the world’s bauxite production, which is used to make aluminum.

Argentina, Australia and Chile are the main producers of lithium, while Bolivia has considerable untapped resources.

What are the geopolitical risks?

“The oil and gas triangle – Saudi Arabia, Russia and the United States – has ruled the world for 40 years,” said Philippe Varin, who led French steel and automotive companies and recently wrote a report on the supply of raw materials. first to French companies.

He said that now “it is gradually turning into a bipolarization of the world between the United States and China, the main users of metals in the energy transition.”

Varin said that Chinese companies have taken control of 40% of the value chain of metals needed for the production of the batteries.

Emmanuel Hache, a meteorologist at the French Petroleum Institute, said that raw materials “could be the cause of a confrontation between China and the United States in the years to come”.

“Behind all conflicts you find commodities as a major cause,” said CyclOpe, an annual French commodity publication, creating a link between the military coup in Guinea in 2021 and bauxite.

© 2022 AFP