The IMF recently warned that the pursuit of net-zero emissions by 2050 will “spur unprecedented demand for some of the most crucial minerals,” leading to “soaring costs” that could “derail or delay the energy transition.” The rising crescendo of alarm is justified: “crucial minerals” loom as the main bottleneck to decarbonization.
WASHINGTON, DC – Will a shortage of minerals short-circuit the clean-energy transition? National governments – including the United States, Japan, Britain, and Canada – the European Union, and international organizations such as the World Bank, the International Monetary Fund, and the International Energy Agency are raising the alarm.
As the IMF puts it, the pursuit of net-zero emissions by 2050 will “spur unprecedented demand for some of the most crucial metals,” leading to “soaring costs” that could “derail or delay the energy transition itself.”
The rising crescendo of alarm is justified: “crucial metals” could well loom as the biggest potential bottleneck to the shift away from fossil fuels. Decarbonization requires a huge increase in equipment and infrastructure, which in turn means an enormous increase in metals for the batteries and wiring that an electrified future will require. As I describe in my book The New Map, changing how we power the global economy will require a move from Big Oil to Big Shovels. In other words, there will have to be a lot of mining.
Demand for the required minerals is already increasing dramatically, and the IEA’s net-zero 2050 scenario projects that it will more than triple just over the next seven years. That could be an understatement. The proliferation of government programs aimed at accelerating the energy transition will further increase demand. S&P Global’s own recent analysis finds that America’s massive Inflation Reduction Act (IRA) will add significantly to the already high projections.
For the rest of this article: https://www.project-syndicate.org/magazine/critical-minerals-metals-us-europe-china-by-daniel-yergin-2023-09