With the growing need to transition to green energy, the energy transition is becoming one of the key elements in the fight against climate change. In order for the development of technologies based on renewable energy sources and zero-emission transportation to become possible, it is necessary to ensure access to the raw materials that underpin these solutions. However, the problem with the availability of many of these raw materials could pose a serious threat not only to the European Union, but also to the global economy.
Cobalt, copper, lithium – key raw materials for green energy
A report prepared by the international company Arup indicates that six raw materials, including cobalt, copper, graphite, lithium, nickel and rare earth metals, are critical in the production of technologies related to renewable energy and zero-carbon transportation. These materials are essential for the production of solar panels, wind turbines, batteries for electric vehicles or energy storage.
The European Union has recognized the importance of these resources by introducing the Critical Raw Materials Act (CRMA), which singles out 17 raw materials of strategic importance. The Arup report shows, however, that access to some of these resources could become increasingly problematic, especially with their concentration in countries with unstable political and economic conditions.
Source: EBN
China’s dominance and problems with source diversification
One of the biggest challenges in sourcing critical raw materials is the dominance of China, which controls most of the world’s mining and processing of many of them. One example is graphite, as much as 74% of which comes from China, all of which is processed in that country. The problem also extends to rare earth metals, crucial to the production of magnets used in wind turbines and electric motors.
Other countries such as Chile, Indonesia, Australia and the Democratic Republic of Congo also play an important role in supply chains, providing copper, lithium and nickel. However, climate change, water problems and other environmental crises could destabilize mining in these regions, posing an additional threat to security of supply.
Source: Statista, EBN, IEA
European drive to diversify sources
To enhance security of supply, the European Union has decided to introduce rules to diversify the sources of critical raw materials. Under the CRMA law, at least 10% of the EU’s annual raw material requirements are to come from its own extraction, 40% from processing within Europe, and 25% is to be sourced from recycling. The pursuit of sustainable sourcing of raw materials, taking into account environmental principles, is a key element of the EU’s strategy, especially in the context of growing demand for raw materials.
Rafal Janus, Energy Leader at Arup, stresses that with the development of green energy, it becomes necessary not only to increase the production of technologies such as batteries and electric vehicles, but also to develop a diversified and resilient supply chain. In this context, Europe is planning to move part of the processing of raw materials to its own continent, which will reduce dependence on distant countries and increase control over supply chains.
Raw material price rise and risk of disruption
Demand for raw materials is growing, and their prices are becoming increasingly volatile. Dependence on political, economic and environmental factors in mining countries makes raw material markets vulnerable to sudden fluctuations. An example is the uncertainty surrounding cobalt mining in the Democratic Republic of Congo, which has been associated with serious social and environmental problems for years.
According to Arup experts, volatile commodity prices, changes in government policies, climate risks and processing problems can lead to delays in the production of key technologies. Hence, companies and investors need to keep a particularly close eye on the raw materials market and adapt their strategies to the dynamic changes.
Sustainability in raw material extraction
One of the biggest challenges associated with the extraction of critical raw materials is their impact on the environment. The extraction and processing of natural resources accounts for about half of global greenhouse gas emissions. In addition, mining leads to loss of biodiversity, water and soil pollution, and negative social impacts such as child labor and human rights violations.
Arup points to the need to implement more sustainable methods of sourcing raw materials. The European Union, through a taxonomy of sustainability, can in the future introduce strict standards for the extraction and processing of raw materials to reduce the negative impact of these activities on the planet and societies. It is worth noting that China is one of the countries where mining problems are particularly prominent, and its dominance in the extraction of rare earths poses enormous environmental and social challenges to the world.
Summary
With the coming challenges of the energy transition, the availability of critical raw materials is becoming a key issue for energy security and the development of a sustainable economy. As Europe seeks to diversify its raw material sources and increase its independence from unstable regions, it faces many challenges related to the environmental and social consequences of extraction. Only through a sustainable approach to the extraction and processing of these resources will it be possible to maintain a balance between development and the protection of our planet.
Source: https://nowoczesny-przemysl.pl/surowce-dla-transformacji-energetycznej/
