WASHINGTON D.C. (04/25/2023) – The Institute for Energy Research has released a new report providing a deep dive into the role of critical minerals in the “net zero” approach to energy policy being pursued by the current administration and other Western leaders.
Our newest research paper, “The Economic and Strategic Importance of Domestic Mineral Production,” provides a sober analysis of the challenge of retooling our energy system from hydrocarbons to minerals and critical materials, which would be required under such net zero policies. Specifically, the report shows:
- A “net zero” carbon emissions policy requires significantly more critical minerals than we are using now.
- Critical mineral processing and production is currently concentrated in China, meaning that pursuing a “net zero” strategy will have serious implications for both national and energy security.
- The increase in demand for these minerals and materials is already putting upward pressure on prices. If we don’t take steps to simplify the process of permitting and opening mines in the U.S., these problems will only get worse over time.
Thomas Pyle, president of the Institute for Energy Research, issued the following statement along with the new report:
“By committing us to the path of ‘net zero’ energy policies, the Biden Administration is rolling the dice when it comes to U.S. energy and national security. This new report lays out the facts on critical mineral production, including the sobering reality that the vast majority of the processing and production of these resources is done in one adversarial country: China. The report also shows that while the United States has the potential to rapidly increase its own production of minerals, the very proponents of net zero policies have also worked to block such opportunities at nearly every turn.
My hope is that this paper will start a much-needed discussion about the impacts of net zero policies, the role of critical minerals, and the reforms needed to allow our domestic industry to mine, baby, mine.”
Congressman Pete Stauber (R-MN), Chairman of the House Natural Resources Subcommittee on Energy and Mineral Resources, issued the following statement in support of IER’s new research:
“In order to secure our national and energy security, the United States must end our reliance on Communist China for our mineral needs. We have the resources, the workforce, and the technology to become mineral independent and dominant, we just need the political will to modernize the permitting process to unlock our resources, including those in my northern Minnesota district. IER’s report is an important and helpful resource detailing the challenges to securing domestic supply chains and ending reliance on foreign mineral sources, and I thank them for this important work.”
Read IER’s new report The Economic and Strategic Importance of Domestic Mineral Production
Key Facts and Figures:
- According to the IEA’s “sustainable development scenario,” these new energy technologies will require a 42-fold increase in lithium demand, a 25-fold increase in graphite demand, a 21-fold increase in cobalt demand, a 19-fold increase in nickel demand, and a 7-fold increase in rare earth demand by 2040 to meet carbon dioxide emissions goals set by some governments around the world.
- Critical minerals production is incredibly concentrated, which has implications for both international relations and energy security. For example, “the production of many energy transition minerals today is more geographically concentrated than that of oil or gas.” The processing of these minerals is even more. China is the largest processor of copper, nickel, cobalt, lithium, and rare earth—processing between 35 percent and 85 percent of these minerals.
- The increase in demand for these minerals and materials is already putting upward pressure on prices. According to Benchmark Minerals Intelligence, from April 2021 to April 2022, the raw materials that constitute NCM (nickel, cobalt, magnesium) lithium-ion batteries have increased in price by 164 percent, and the raw materials that make-up lithium-ion phosphate batteries have increased by 393 percent.
Additional Resources:
- Kenny Stein Testifies Before the House Ways and Means Committee on “Green” Subsidies in Biden’s Inflation Reduction Act
- China Expected to Increase Control Over Global Lithium and Cobalt Supply
- China Positions Itself Well in the Net-Zero Market
- Report: Energy Security is National Security
________
For media inquiries, please contact [email protected]
