(OPINION) Metals are quickly becoming the new oil as fossil fuels are phased out and replaced with clean energy and electric cars. The green energy transition relies on mining to produce enough lithium, cobalt, and nickel for the expected boom in solar panels, wind turbines, and electric car batteries over the next decade.
According to Yahoo News, The only problem is that most of those metals are already in short supply. Paltry investments by governments in mining, the complexity of recycling rare metals, and geopolitical trade squabbles are already hampering metal production.
In a recent note to investors, Bank of America analysts warned of a shortage of many critical elements, including rare earth metals that are harder to produce, just as demand is starting to soar. Many of these metals are abundant in the Earth’s crust, but tend to be in low concentrations and are expensive to separate and refine.
And while soaring use of these elements has pushed their prices to record highs, it’s feared that modest increases in mining will be unable to meet the demand. “Commodity prices have risen, making it more attractive for investors,” Liesbet Grégoir, a metals and mining researcher at Belgian University KU Leuven, told Fortune. “But there is not enough in the pipeline yet. Developing mining projects takes time, and there is a real risk we’re not starting early enough.”
To meet their goals for reducing carbon emissions, countries are depending on the clean energy revolution, which will include huge demand for renewable energy infrastructure and electric vehicles.
The booming interest in electric vehicles over the next decade will see demand for lithium—a crucial metal in EV battery manufacturing—increase 40 times, according to a report last year from The International Energy Agency, a global energy watchdog. Demand for other metals used in batteries and solar panels, like graphite, cobalt, and nickel, is expected to multiply 20 to 25 times current levels.
“Rare earth materials are fundamental building blocks and their applications are very wide across modern life,” Matt Schloustcher, senior vice president of communications and policy at rare earth mining operator MP Minerals, told Fortune. But he added that “one third of the demand in 2035 is not projected to be satisfied based on investments that are happening now.”
