‘Net Zero’ Will Mean a Mining Boom

But political instability will make it difficult to obtain all the minerals electric cars will need

By Daniel Yergin. Excerpts:

"California made a stunning decision last year—that by 2035 all new cars sold in the state must have at least 2½ times as much copper as conventional cars today. That’s not literally what the mandate said, of course, but it’s the practical effect of ordering all cars to be electric in the next 12 years."

"getting everything that will be needed will be tough."

"An offshore wind project uses nine times the minerals of a natural-gas-fired power plant of the same generating capacity."

"The International Monetary Fund warns that striving to achieve net zero by 2050 will “spur unprecedented demand for some of the most crucial metals,” leading to price spikes that “could derail or delay the energy transition itself.”"

"will require a huge amount of copper, as it is the “metal of electrification.”"

"translating the 2050 net zero goals into the equipment and technologies that will be needed—electric-vehicle batteries and charging stations, offshore wind, onshore wind, solar panels, battery storage, etc.—adds up to a doubling of the need for copper by the mid-2030s."

"Two countries mine about 40% of world’s copper supplies—Peru, where the government is in disarray after the president was impeached and arrested, and Chile, whose government is struggling between its populist agenda and the need for economic growth."

"developing a major new mine takes 15 to 20 years or more. That’s partially because of the sheer amount of planning, logistics and construction required. A good part of the time is also taken up by the arduous process of negotiating and obtaining permits, which shifting government policies and regulatory complexity slow down. The huge $7 billion Ouy Tolgoi underground mine in Mongolia, which just went into operation, will be the fourth-largest copper mine in the world. Getting there entailed many years and a multitude of delays, and even now the project is far from finished."

"Though the rise in mineral prices will stoke investment and therefore new supply, it will also stoke populist interest in changing the government contracts that set the rules for mining operations"

"Seventy percent of cobalt, critical for electric-vehicle batteries, comes from the Democratic Republic of the Congo, where large mining operations coexist with small, hand-dug mines in which both adults and children work."

"about 60% of the world’s lithium is processed in China, and 47% of copper is smelted there. By comparison, the U.S. processes 4% of world copper. Once the U.S. had more than a dozen copper smelters; now it has two."

"rejiggering the mineral supply chains won’t be easy. Copper production has fallen by half in the U.S. in recent decades, and dependence on imports continues to grow. Getting permits for new projects is difficult, subject to repetitive and lengthy reviews by regulatory agencies and recurrent challenges in courts. And costs for mining and processing in the U.S. tend to be considerably higher than in other countries."