Electric vehicles have traversed harsh road conditions, but they are still far from their final destination. At issue are the rare earths that go into making the electric motor — minerals primarily controlled by China. The question for Western policymakers is whether to ease the rules to mine for those elements or to continue to rely on China, which is quickly industrializing and which is also the fastest-growing EV market.
The United States mined rare earths from the 1960s through the 1980s at a single mine in California. But this country defaulted to China because of its cheap labor cost — and the environmental footprint left behind. Rare earths contain 17 minerals that must be separated, which is a dirty and labor-intensive effort. Beyond China, Australia, Brazil, and Canada produce rare earths. Given that the United States wants more EVs on the road, should it pursue more rare earths mining?
“We can’t stop mining,” Luisa Moreno, president of Defense Metals Corp. , which explores rare lands, said in an interview with this author. “Our way of life depends on complex materials, from the car we drive to the buildings that space us. We want those complex materials. We want others to perceive that mining is no longer irresponsible or compromised. Most corporations adopt environmental, social, and governance standards. They work with environmentalists and engineers to make mining cleaner and safer.
China has lately mined 63% of rare earths: 140,000 tonnes of the 240,000 tonnes mined worldwide. China used to extract 90% of all those minerals. But it controls 85% of the processing, that is, the effort to separate the 17 minerals from the rare terrestrial rock. Consider that the United States produces 38,000 tons. But this one is sent to China for processing.
At the same time, China has consolidated three of its state-owned rare earth corporations into a single company: China Minmetals Rare Earth Co. , which also uses the minerals for smartphones, televisions and fighter jets. These elements had gone unnoticed. But China has implicitly threatened to use them as a weapon against the United States in the tariff war unleashed during the Trump administration.
Dr. Moreno says that the demand for rare earths will more than double by mid-century to 500,000 tons — once the EVs start to roll out en masse. Even more powerful, those same minerals are used in windmills, electrolyzers, and transmission lines that are also needed to hit net-zero goals.
Prime the Pump
War over Rare Earths which are a group of elements that help in the making of smart phones to … [+] computer hard drives, lasers, missiles and weaponry, today a $ 2 billion industry. Recently China the largest exporter pinched supplies. India has a large resource and Indian Rare Earths Limited mines it from beach sands in Kerala. The black sand is a rich ore for rare earths and scientists perfect its extraction. India could out match China and capture the market. (Photo by Pallava Bagla/Corbis via Getty Images)
Policymakers perceive the dilemma: The European Union is phasing out internal combustion engines by 2040, while the Biden administration needs a share of all cars sold in the U. S. to be phased out. If the U. S. were to run on electric power until 2030. Si electric power can upgrade gasoline, countries would meet their climate challenges. Objectives.
In the United States, General Motors, Ford Motor Co. , and Stellantis support President Biden’s initiative. In Europe, policymakers have approved the EU’s $3. 5 billion battery innovation allocation to move away from fossil fuels, including rare earth progress. The corporations competing for investments are Fiat Chrysler, BMW, and Tesla, as well as Arkema, Borealis, Enel X, Solvay, and Sunlight Systems.
“It is important for the government to be more supportive of these critical materials,” says Defense Metals’ Moreno. “It takes a long time to bring mines into production, and demand is fast approaching. The other thing is education — to impart to the public that we have to mine these advanced materials if we are to go greener. It can be done responsibly. When the public supports this movement, the financial markets will understand the value proposition.”
EVs comprise 2% of the global car market. The U.S. Energy Information Administration projects passenger vehicles, fleets, and smaller trucks that use both electricity and gas to grow from 1.31 billion vehicles in 2020 to 2.21 billion by 2050. It estimates that hybrids will make up 34% of cars in developed countries and 28% in emerging economies by 2050.
The tread of the tyre
DETROIT – JANUARY 10: In this handout photo provided by General Motors, Michigan Governor Jennifer … [+] Granholm holds the cord used to plug-in the Chevrolet Volt electric concept vehicle in the General Motors display at the North American International Auto Show January 10, 2007 in Detroit, Michigan. The Volt is powered by E-flex, GM’s next-generation electric propulsion system that nearly eliminates trips to the gas station. (Photo by John F. Martin/General Motors via Getty Images)
But can the United States wean itself from China’s rare earths? The Biden Administration’s push to reduce U.S. reliance on Chinese imports has renewed domestic efforts to produce rare earths minerals — something that has spawned legislation to curb those imports as it relates to the defense sector. But any such laws will be hard to pass here, mainly because a more liberal-leaning Congress would oppose any domestic expansion of mining.
The International Energy Agency says electric cars use six times more minerals than those powered by an internal combustion engine. But he adds that, on a global scale, there is no shortage of rare terrestrial elements. Implicit in his research is that mining techniques have to be best-in-class.
In this scenario, it would take many years for the United States to catch up with China. According to the U. S. Geological Survey, China accounts for the preponderance of world production and 40% of its reserves.
In addition, China plans to build 6 million electric vehicles by 2023, which would require 30,000 tons of rare earths, according to Research and Markets. What effect will this have on electric vehicles?
“The demand for rare earths will continue, and if we do not develop these projects, China will likely acquire assets in South America and Africa,” says Dr. Moreno. “It not only wants to control production but also where they export, how much, and when. The European Union gives aid to companies because it helps advance the green technology agenda.”
The foreign economy is so intertwined that it would be difficult for China to weaponize rare land or grab it for domestic use. But this does not exempt us from diversifying suppliers and minimizing political risks. Even though the U. S. is unlikely to start exploiting those lands, minerals, Washington can still create incentives similar to the task of the EU’s Battery Innovation: for environmental functionality in all segments of the EV price chain.
See also:
— The Argument Against EVs is Shallow
— Road transport goes electric
— Tesla: Battery recycling is key
– Automakers Make a Map to Expand Chargers
— EO Load Target Fleets
— Chinese electric cars will outperform the competition.