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Preface from OurEnergyPolicy
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In the time since our November 2019 critical minerals discussion, COVID-19 has decimated global supply chains. Factory shutdowns in China, which accounts for 40–50% of the global wind power supply chain, have caused supply shortages of wind turbine components and massive financial losses, threatening current U.S. projects. China’s outsized market share is also affecting the solar market, although some analysts say a U.S. tariff on imported solar panels may have blunted the impact.
“If coronavirus has shown us anything, it’s that we are far too reliant on China and other countries for key minerals like lithium, cobalt, and nickel,” said Doug Cole, CEO of American Battery Metals. Read more below from Senator Lisa Murkowski (R-AK) about the importance for the energy industry of addressing the United States’ reliance on foreign minerals, and please participate in the discussion! |
The coronavirus pandemic has made clear that robust supply chains are essential to our economy and public health. I have been working for years to bring attention to one of America’s most significant supply chain vulnerabilities—a lack of domestic production of the minerals and materials needed to produce everything from medical equipment to defense systems—and I believe that action to address it is now timelier than ever.
America’s reliance on foreign nations for minerals is an acute risk that we need to take seriously and reverse. According to the U.S. Geological Survey, last year we imported at least 50 percent of our supply of 46 minerals, including 100 percent of 17 of those. I have described this as our Achilles’ heel, because it serves to empower and enrich other nations while costing us jobs, damaging our competitiveness, and undermining our ability to lead the industries of the future.
Energy is no exception: we need a wide array of strategic minerals to build the solar panels, batteries, electric vehicles, pipelines, and other infrastructure needed to power our society. To produce more of these technologies, we will need a massive increase in supplies of lithium, cobalt, nickel, and graphite, to name just a few. Yet China has consolidated its power over their production and processing while America lags far behind.
Our foreign mineral dependence is not breaking news; it just rarely makes the news. For example, did you read the World Bank’s report forecasting 1,000 percent growth in demand for key minerals to meet global climate goals? Or Foreign Policy’s documentation of China’s decisive moves to control minerals and entire industries? Simon Moores, of Benchmark Mineral Intelligence, succinctly drove the point home when he testified before our committee last year that, “We are in the midst of a global battery arms race, in which so far the U.S. is a bystander.”
We have effectively surrendered the front end of the supply chain to other nations. If we fail to adjust course, we will continue to cede jobs and economic growth. We will face supply disruptions and price spikes for essential building blocks that we effectively choose not to produce. The Trump administration deserves credit for the steps it has taken to change our trajectory, and I have re-introduced my American Mineral Security Act to strengthen those efforts. My bipartisan bill provides a comprehensive framework to rebuild our domestic mineral supply chain through geological surveying, forecasting, workforce training, research and development, recycling, and a more efficient permitting process.
As our country begins to emerge from the current crisis and considers options to restore our economy, it is critical that we set a course for long-term resilience by addressing the supply chain vulnerabilities the pandemic has exposed. That should start with mineral security—and the modernization of federal policies that will serve to protect us going forward.
Question 1: What impacts from COVID are you seeing on energy supply chains in your role at your company or organization? Has this brought new insights or caused you to… Read more »
At the Women’s Mining Coalition, we asked our members this question and received the following feedback: – New emphasis on US independence is prevalent – Abrupt decrease in fuel price… Read more »
I certainly agree that just-in-time inventory and supply strategy “should be revisited”. That’s plain common sense. I also agree that we need to increase domestic production of rare earths. But… Read more »
Question 2: What actions can the United States take to develop domestic critical mineral supplies and supply chains? Is there anything you would add to the Senator’s American Mineral Security… Read more »
One of the easiest and most effective measures would be to change the tax codes in ways that would facilitate / remove the disincentives for stockpiling. Stockpiling is easy, has… Read more »
At the Women’s Mining Coalition, we asked our members this question and received the following feedback: – Continue to support mining industry and streamline permitting hurdles – Supply chain is… Read more »
These are all points on the mining industries lobbying agenda. Some may have merit. However, as some environmentalist quipped, “if it involves mining, it ain’t sustainable.” I don’t go that… Read more »
Question 3: Which domestic clean energy supply chains are set up for success, and which need additional support, especially for resilience amid a pandemic or other supply chain challenge?
The pandemic threatens America’s clean energy mineral supplies, waterways, and people. Eisenhower mandated that two independent engineers double-check all hazards. University professor Rogers diagnosed why the 2005 Hurricane Katrina flooded… Read more »
Also, the IHNC failures: In January 2008, Judge Duval placed responsibility for the floodwall collapses of the 17th Street and London Avenue Canals on the Corps (Nossiter, 2008). However, the… Read more »
At the Women’s Mining Coalition, we asked our members this question and received the following feedback: – All mining endeavors for critical minerals need to continue to be supported –… Read more »
Apologies in advance, but I’m not going to focus directly on the specific questions above. They’re important and useful, but they’re subordinate (IMO) to some higher level questions we need… Read more »
Fair comment and well thought out.
I have long felt that the world not just the U.S. was making a mistake. We were rushing head long to replace one limited resource with a different one that… Read more »
Regarding geothermal energy, there’s major potential that has not yet been exploited. It’s not just a matter of total geothermal capacity, but of how geothermal capacity can be utilized. Geothermal… Read more »
Bruce, I like run-of-the-river hydro, but as I’m sure you know, it can be pretty variable on a seasonal time scale. Or even weekly, when it’s affected by heavy rains… Read more »
This is a really important comment from Senator Murkowski. I welcome Ourenergypolicy.org’s invite to add some of my own thoughts to this. Since my Senate testimony, the US has fallen… Read more »
Simon, the numbers you cite seem alarming. It would be helpful, however, to know more about the nature of the various new battery factories that are being built. How much… Read more »
Part of the Lithium problem is that the auto industry is chasing the old internal combustion transportation model, seeking longer and longer ranges for electric cars. But 99% of our… Read more »
Herschel, I agree about the typical length of car trips, and the consequent adequacy of modest “pure electric mode” ranges to deliver 99% of automotive carbon reduction benefits of EVs.… Read more »
I agree with Roger and will add that cars with ~100 mile range were and are available (original Leaf, Fiat 500e, etc.) and people don’t buy them. People are not… Read more »
The reports of Tesla including support for V2G as an undocumented feature in Model 3s that could be activated with an over-the-air update may or may not be correct. There’s… Read more »
Thanks for the details about Tesla’s V2G status. Regardless of what Tesla does with V2G in the short term, the fact that EV charging is usually done over a longer… Read more »
Dan, I’m glad you brought up the robotaxies in that it is another example of rethinking what vehicular transportation might be, other than the present internal combustion model. I am… Read more »
Herschel: There are always edge cases that don’t work well… climate change is a big “edge case” that we are hurtling towards! But overall, V2G provides flexibility and backup, and… Read more »
Dependence on China (and other problematic sources) for strategic minerals is a real problem. I have been writing about it for years (e.g. https://seekingalpha.com/article/3178346-a-case-study-in-natural-monopoly-chinas-fading-dominance-of-rare-earths ). The delicate problem is how… Read more »
Will domestic oil production drop at least until full economic recovery, and will this require the US to import crude? How will domestic producers thereby shut down survive until they… Read more »