The Global Race for Rare Metals: A Hurdle to the Green Revolution

In the quest for a greener future, the availability of rare metals and minerals plays a pivotal role. Despite diplomatic triumphs, ambitious energy transition laws, and fervent ecological advocacy, our progress toward a sustainable future may be hindered by a looming challenge - the scarcity of rare metals. These essential components are now omnipresent in our electrical devices, with mostly all of them being produced in China.

If current trends persist, the green revolution may stall, and the scenario where China leads the charge toward ecological transition becomes increasingly plausible. Beijing is unlikely to boost its rare metal production in the coming years. This decision is not just rooted in commercial goals, but it's also a strategic move to reserve a substantial portion of the production for domestic consumption.

China, already the world's largest consumer of rare earths, consumes nearly 75% of what it extracts. With its ambitious plans in electronics, the military, and renewable energy, it could monopolize most of these resources by 2027-2030. The result? A significant portion of rare metal production, whether within or beyond its borders, may be channeled exclusively to Chinese clients.

Surprisingly, one of the world's most polluted countries could emerge as a leader in driving a greener world and combating climate change.

This scenario is bolstered by three critical elements.

First, the persistent denial of resource scarcity, an attitude that dates back to the early 20th century.? In the grand narrative of the energy transition, one glaring paradox stands out – the persistent denial of resource scarcity. This attitude, deeply entrenched in the human psyche, has its roots in the early 20th century and continues to cast a long shadow over our journey toward a more sustainable energy future.

The prevalent mindset of endless abundance has often overshadowed the stark realities of depletion. The "Club of Rome," in its seminal 1972 report, "The Limits to Growth," highlighted the alarming incongruity between the exponential growth of the global population and economy and the finite limits of available resources. Decades later, this report's message remains eerily prescient.

What's more, our tendency to underestimate resource scarcity is underscored by our relentless consumption. Even as early warnings sounded, we have, with every passing decade, continued to exploit resources with ever-increasing fervor. This is not a behavior grounded in logic; it's a reflection of the inherent human inclination to assume abundance.

This denial of resource scarcity has inadvertently led us to neglect investing in vital mining infrastructure.

Second, the pressing need for substantial mining infrastructure investments. As an example, needs in cobalt will be multiplied by more than 10 within next two decades and investments are still not there to answer to demand. In addition, it takes a considerable amount of time, typically fifteen to twenty-five years, from the decision to commence a mine to actual mineral extraction. Given the urgency of addressing climate change, these time frames are increasingly incompatible with our goals for a rapid transition to clean energy.

Finally, there's the challenge of the energy return on investment (EROI), measuring the energy needed for metal production versus what their use generates. The energy required to extract and refine these metals is surging, and this trend poses a significant dilemma for the energy transition.

A century ago, one barrel of oil yielded approximatively 100 barrels. Today, it barely produces 35 in some drilling areas. Similarly, the extraction of rare metals demands increasingly more energy. In Chile, for instance, the energy needed to extract copper surged by 50% between 2001 and 2010, while copper production only increased by 14%. This trend is mirrored in the United States, particularly in the copper industry.

In the past, the main constraints on mining were the quantity and quality of the ore being mined. However, as technology has advanced and mining operations have become more sophisticated, the energy requirements of mining have increased significantly.

The mining industry, as a whole, faces a unique challenge - the limitations on extraction are no longer quantitative, but rather lie in the realm of energy constraints.