U.S. must act quickly to increase mining for clean energy needs
The time has never been riper for a government pro-mining policy in America. A shift away from fossil fuels will require a secure supply of minerals and metals needed in the quest for clean energy.
The political climate for mining today is very different than the one that existed in the past when policymakers thought that imports of battery minerals and metals like lithium, nickel and rare earths, combined with battery recycling, would curb the need for more domestic mines. An awareness that times have changed is reflected in passage of the Inflation Reduction Act, recently signed into law, that provides $400 billion for a wide range of climate initiatives, including the creation of new mines.
The trend is pretty clear. Though mining inspires in most environmentalists a deep aversion, it no longer looks like a cosmic-level problem. Whatever risks go with domestic mining are local, while carbon pollution is global in its impact.
Reshoring mining would be a game-changer in the battle against global warming. And there’s a national security element, since a secure supply of minerals and metals is needed for weapons production.
Make no mistake, dependence on imported minerals is an economic and geopolitical albatross. Our imports have doubled in the past two decades — and some of the most critically important minerals come from hostile countries. Russia and two of its closest allies, Kazakhstan and Uzbekistan, both former Soviet states, supply about 50% of the uranium used at nuclear power plants in the United States. And Russia is a key supplier of nickel needed in the production of EV batteries and steel. Chinese companies dominate global commerce in minerals, with unprecedented power over the mining and processing of virtually every battery metal, including lithium and cobalt, and rare earth minerals.
Fortunately, there are ways to make greater use of our own abundant resources — which is something that can be done safely and expeditiously.
From lithium to nickel to copper, metals for electric car batteries and the transition to renewable energy are in great demand by manufacturers worldwide. While there’s recognition in Congress of the growing demand for minerals and metals in international markets, remains disconnect between the scale of demand and what will be required to meet it. For one thing, far greater quantities of minerals and metals go into the construction of EVs than combustion cars.
With the explosive growth of global EV sales — more than 7 million vehicles sold in 2021, three times the number in 2019 — building the required mineral supply chains for lithium-ion batteries is taking on new urgency.
Reaching the goal of net zero greenhouse gas emissions by 2050 requires accelerating the transition to EVs, since combustion vehicles are the largest source of carbon emissions in the United States. But automobile experts foresee some speed bumps ahead. They warn that a shortage of battery metals could stall EV production in the United States and give China a commanding lead in world EV sales plus geopolitical leverage.
The International Energy Agency said in a recent study that meeting carbon mitigation goals will necessitate expanding global production of battery metals from 7 million tons per year to 42 million by 2040 — a sixfold increase, requiring the creation of hundreds of new mines.
As EV production expands, demand for lithium is expected to grow by as much as 40 times over 2020 levels. Today only one lithium mine operates in the U.S. There is one nickel mine, one rare earth mine. No cobalt or graphite mines.
An enormous amount of work needs to happen and happen extraordinarily quickly. Failure to strengthen supply chains will threaten EV and renewable energy development and endanger national security. The price of lithium has soared more than 600% this year — and that price surge is affecting battery costs and the cost of EVs. Tesla, for example, has raised the price of its vehicles more than 20% since last year.
The problem isn’t a lack of mineral resources. There are promising lithium projects in Nevada, California, Arkansas and North Carolina. Exploration has turned up nickel and cobalt resources in Minnesota and Idaho and graphite in Alabama and Alaska. Copper in Arizona. But the challenge continues to be getting mines permitted. It typically takes a decade to obtain a permit for a new mine in the U.S., if it happens at all. That must change if the U.S. is to build the materials supply chains needed to underpin the energy transition.
With help from Congress, scaled-up mining could become a climate solution, not a problem. Legislation is now pending to address problems interfering with energy infrastructure development, including an outdated permitting process for new mines so that it doesn’t take forever to get one built.
More mines must come into production soon so the world has dependable mineral supply chains for the energy transition. The U.S. must now do its part to ensure that we are contributing to that effort.