Getting the world to net-zero emissions by 2050 will require the production of critical minerals and metals to grow sixfold over the next 30 years, the International Energy Agency declared in a report earlier this year — and it found the current pace of growth isn't even close.
As electric cars, wind turbines and solar panels explode in popularity, so too does demand for the minerals that make them go. Some are familiar, like nickel, lithium and cobalt, and others are known only to those who memorized the periodic table in high school, like tellurium, bismuth and molybdenum.
Canada, having promised that all the electricity it generates and the new cars that are sold in the country will be zero-emission by 2035, is among the countries driving up demand.
As one of the world's biggest producers of raw metals and minerals, Canada also wants to be filling that demand as a key link in the supply chain for rechargeable batteries.
But even as the federal government pushes a new critical minerals strategy and forges partnerships with allies to develop supply chains that seek to tamp down China's dominance in the field, Canada's position on the world stage is already slipping.
"We're starting to do what we need to do but there's a lot of missing pieces," said Pierre Gratton, president of the Mining Association of Canada.
A year ago, BloombergNEF listed Canada as the fourth most important player in the world's lithium-ion battery supply chain, based on an analysis of raw material production, manufacturing and processing, environmental protections, regulatory regimes and domestic demand.
This fall, the second iteration of that report saw Canada drop to fifth, losing ground in every category.
"We've been viewed sort of as a global leader in the past," said Gratton. "We've lost ground, though."
Canada's ranking slipped because of raw materials and environmental stewardship — the latter a key point in all the sales pitches Canada makes on the world stage.
The problem is, meeting those higher standards comes at a cost, said Gratton. Canada also has to convince buyers that the premium is worth it.
"If you care about climate, and you care about the environment, and if you care about how people are treated, including Indigenous people, then buying from Canada is the right thing to do."
China is the biggest player in the battery supply chain field, both in raw materials and value-added production. Many of the alliances Canada is part of with the United States and Europe are designed in large part to whittle away at China's dominance.
Canada, second in the world in nickel production in 2008, ranked sixth in 2020. It is also sixth for cobalt, and 10th for graphite. Production of all three declined last year.
Those elements, along with lithium and manganese, which Canada could but doesn't currently produce, are the five main components of the lithium-ion batteries that run electric cars.
More than 70 per cent of Canada's nickel is sold to make stainless steel. The nickel that makes batteries is nickel sulphate. Canada does not make it, said Gratton, but it needs to in order to be part of the battery chain.
He said that is being discussed among nickel producers and bandied about as a potential project for Ottawa's strategic infrastructure funding.
But Sarah Petrevan, policy director at Clean Energy Canada, said Canada "needs to have a strategic focus about where we can win."
"We have finite resources, and so you want to make sure that you're putting those finite resources in the place that can have the biggest impact."
Quebec, said Petrevan, has done some of that strategic work of assessing their own supply chains, trying to match what Quebec makes with new manufacturing that meets demand. At least two battery production plants are in the works now in that province.
Canada, however, has not yet done a similar assessment.
Last March, Canada identified the 31 critical minerals it can produce and that at least one of its allies wants, but little has been done with that list since.
Innovation Minister Francois-Philippe Champagne has been dropping broad hints about a major new battery-chain investment coming to Canada, though Petrevan said the dispute with the United States about electric vehicle incentives and trade barriers may be slowing that down.
Last spring's federal budget promised $9.6 million over three years for a battery minerals centre of excellence within the Department of Natural Resources, but nothing has happened yet. Nearly $37 million was also promised for federal research on advancing critical battery mineral processing and refining.
Natural Resources Minister Jonathan Wilkinson is expected to make both a priority early in the new year.
For his part, Gratton said Canada needs to also encourage more production in general. The Liberals made an election promise to double the mineral exploration tax credit and he hopes to see that in the next budget.
"We don't just need to sort of redirect existing production to battery metals, we also need more production," he said. "And you're only going to get that through new discovery."
This report by The Canadian Press was first published Dec. 16, 2021.
Comments
I am worried that the increase in mining will create more environmental destruction and also threaten Indigenous rights in Canada. Mining can be a pretty messy business and can have significant negative impacts to water, watershed, forests and whole ecosystems. Have our leaders thought about this? Has society maximized the opportunities to recycle metals from the waste stream? And Indigenous people will again be on the front lines trying to protect their territories from the extractive industries' environmental damage.
For a more complete understanding and rebuttal see: UVic Writing's 2021 Southam Lecture: Andrew Nikiforuk, UVIC, YouTube 21-11-24: https://www.youtube.com/watch?v=NtyY-_1fY-8
We are unlikely to be able to grow the economy and grow our way out of the problem. We have already spent our budget.
Thank you for this link to a very informative talk by one of my favourite authors. It's well worth the time.
I have a couple of quibbles, perhaps the most important one is that Nikiforuk does not address the most recent demographic research that indicates the world population growth rate is slowing and will stabilize somewhere between nine and 10 billion in the latter half of this century. Some analysts attribute that mainly to the education of women and girls and micro-credit offered in undeveloped and developing nations, which increases family income opportunities. Though we in so-called advanced countries may have a far-too-excessive 500 "energy robots" underpinning our existence, there is no way that poor families in underdeveloped nations will ever achieve that amount of energy consumption. The question is, at what level of per capita energy use, and what level of substitution of carbon energy with zero carbon energy, will the world find climate stability?
I would relish the chance to see someone truly explore the realms of possibility beyond the Doomer narrative. Vaclav Smil seems to nearly get there, but we really need to start understanding how to survive, not just constantly hear about the vast systems that are about to fail.
For example, regenerative agriculture has enormous potential to not just increase the yield of food crops, but to actually build the soil resource while also capturing and sequestering millions of tonnes of atmospheric carbon. RA is actually a lower level and far less costly tech that radically decreases the use of fossil fuels by comparison to today's outdated industrial farming methods. It is not all about the cultural view of intensive manual labour on organic farms and urban-edge market gardens, but also a concept that applies to large-scale Prairie grain farms.
Canada may have already lot its place in critical metals and ‘rare earths’ but it also may not be able to regain its prominence. The Globe’s Eric Reguly published an informative if troubling column in the Saturday edition on this topic, which I took the liberty to copy some excerpts (the site has a paywall).
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“China has been quietly buying lithium producers and deposits around the world for years and is also going after cobalt, another vital component of car batteries, and rare earths, a group of 17 specialty metals that are indispensable for the manufacture of high-tech products such as electric motors, mobile phones, wind turbines, hard disk drives and LEDs.
“China’s strategy is obvious and hardly a secret: It wants to lock up the raw supplies and the processing capability of the metals that will power the next industrial revolution, from EVs and other clean-energy innovations to leading-edge consumer electronics.
“By all accounts, it has a strong lead in these metals, leaving North American and European companies to play catch up – if they can. Only recently have Western governments realized the mistakes they made by not insisting years ago on the careful screening of foreign takeover attempts in this industry. Free-market ideology meant that management and shareholders got their way with minimal government or regulatory interference.
“A recent report by the Center for Strategic and International Studies pretty much concludes that the game is all but lost for the West, as China has built stakes in the “green” metals required to decarbonize the world’s energy supply and transportation systems. “No longer a simple mineral producer or component assembler, China is emerging as a higher-value manufacturer that requires a growing volume of the minerals and metals that are considered key to clean energy technology manufacturing,” the report says. “China has become a dominant stakeholder in the global supply chains for critical minerals and clean energy goods.”
“The report estimates that China is home to 90 per cent of the world’s solar photovoltaic manufacturing industry. In lithium-ion battery cell manufacturing, China’s global share is 80 per cent, and its lithium refining capacity is estimated at 60 per cent. It controls about half the value chain for wind turbines, including their blades, generators and gearboxes.”
https://www.theglobeandmail.com/business/commentary/article-china-is-bu…
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The fact is that Trudeau may just be waking up to China’s strategy of buying companies mining or making critical assets and materials, including Canadian companies without the feds being awake enough to halt the sales. China is also well know for stealing technology from them as well. It’s a mystery why the Trudeau government is still asleep at the switch after the Two Michaels hostage controversy.
Before Trudeau there was Stephen Harper, who switched his attitude on China 180 degrees from one of disdain toward totalitarian communism to “let’s do business even if I have to sell the family store,” probably as the result of Obama’s similar disdain of Harper’s stiff and angry brand of conservatism. The first rejection of Keystone XL had something to do with it too.
So the lesson here is not to put all our eggs in one basket regarding China and lithium ion batteries. There is enough evidence and in-depth theory out there to assume that the worldwide fleet of cars burning fossil fuels is never going to be 100% displaced by EVs and L-ion batteries because oil remains relatively cheap and packs a lot of very handy energy, our current electrical capacity is not enough, and lithium, cobalt and a number of other metals will present supply constraints before too long.
It will be increasingly obvious that the world’s car fleet will have to be reduced, probably by 25-40% once oil is off the climate table, and replacement renewables will not meet the demand for the outrageous overconsumption of resources the almighty car represents. To urbanists, scientists and the ecologically conscious, that will be a Hallelujah moment.
It was a huge mistake for Tesla to march full speed into stationary power storage using massive banks of L-ion batteries. L-ion is better suited for small electronic devices and a limited number of land transport vehicles. The previously mentioned supply constraints will apply equally to EVs and hundreds of acres of Tesla batteries in the Australian desert.
The lithium-cobalt duality is starting to meet competition from battery makers using far cheaper and abundant metals like iron, magnesium, antimony, metallic calcium, etc., These metals are stable, perform well and do not have the problematic dendrite issue that plagues L-ion batteries with explosions and fires, which in turn requires the addition of expensive fire suppression and air conditioning systems at battery farms.
If Canada’s lithium, cobalt and other rare metals are mined by foreign companies and exported raw (that is, after all, the typical Canadian way), then it’s time to focus on the more common metals and coalesce them into very useful products, like scalable stationary power storage facilities, electricity grid components, digital research and development, and trains and buses (trolley and battery powered). Couple this industrial strategy with sustainable urbanism and a build-out process molded from a set of policies to create walkable neighbourhoods with decent transit connections and very energy efficient buildings.
It’s not hard to conceive of initiatives like these, but it does require joined up thinking.