Rare Earth AdvisoryMISSIONS
REA analyses the place of critical metals and minerals now and in the future.
Like coal in the 19th century and oil in the 20th century, these materials have become the key drivers of the 21st century’s industrial revolution, amplifying their importance.
We consider it vital to anticipate and fully understand the many issues surrounding them.
While the environmental and social challenges around the extraction of these materials are legitimate, we find that the European debate is very biased and sometimes full of contradictions.
We suspect that this may discourage companies and governments from taking the urgent action required to secure their supplies of critical metals and minerals.
The development of a recycling industry with multiple long-term benefits for Western countries must, in our opinion, be accompanied by a more radical upstream integration strategy.
Our first research topics concern “Rare Earths” and materials critical to the battery supply chain.
The crisis has exposed problems with the existing intertwined supply chains. We believe it is crucial to develop alternative sources of these materials, which are currently overly dependent on Chinese supplies.
Since 2019, rare earth elements (REE) have regularly made the headlines against a backdrop of supply disruption fears fuelled by US-China trade tensions and environmental scandals related to their extraction. Yet China’s predominance is not confined to rare earth. It extends to the whole of the electric vehicle supply chain, core to the decarbonisation ambitions of western countries, particularly in Europe.
CRITICAL METALS AND MINERALS ARE ESSENTIAL FOR A DECARBONISED ECONOMY
Certain metals and minerals play an essential role in the development of many technologies, both digital (smartphones, tablets, etc.) and low carbon (wind turbines, solar panels, electric vehicles, etc.). Production is often geographically concentrated and guaranteeing security of supply is becoming a major challenge for the energy transition, which we believe western countries are largely underestimating.
THE MAIN MARKETS
Mobile phones and tablets contain not only the base metals (aluminium, copper), gold and silver, needed to make microelectronic components, they also need many rare metals (cobalt, tungsten, rare earth elements, tin).
To meet future power demand thanks to renewable energy sources and thereby reduce or limit future CO2 emissions, the electricity sector (41% of global CO2 emissions) is poised for a huge roll-out of wind and solar technology.
In addition to various base metals (aluminium, copper), precious metals (silver) and composite materials (steel, concrete, glass/carbon fibre and polymers), these installations require rare earth elements incorporated into the permanent magnet generator of direct-drive wind turbines, such as gallium, germanium, tellurium, indium and silica in photovoltaic systems.
Transport accounts for 14% of global CO2 emissions and is also a fast-changing sector for which the development of electric vehicles is considered as core to decarbonisation. This particularly concerns light vehicles and individual modes of transport, such as motorbikes, scooters, electric quads and bicycles. Yet electrification is a hot topic for all fossil-fuelled transport: buses and trucks, farm and building site machinery and of course aviation.
Despite growing consumer acceptance, sales of electric vehicles are still highly sensitive to subsidy policies. Currently, government incentives are required to make up the difference in cost between electric (EV) and conventional vehicles (ICE). Leading countries in terms of electric transport have taken a variety of measures, combining restrictions (CO2 standards), encouragement (grants) and support (deployment of recharging infrastructure).
In addition to greater base metal needs than conventional vehicles, such as aluminium and copper, electric vehicles require several critical metals and minerals. Firstly, there is the lithium-ion (Li-ion) battery as well as the active cathode materials of cobalt, nickel and manganese, together with graphite for the anode. Secondly, there is the electric motor, for which the permanent magnets (NdFeB) based on rare earths are the main components.
REE and critical minerals
*All metals highlighted in the periodic table are considered critical for either Australia, China, the EU, Japan or the US.
LREE: Light Rare Earth Elements ; HREE: Heavy Rare Earth Elements ; CRMs: Critical Raw Materials
Source: European Commission, US Congress, REA