MARIETTA, Ohio — As Ohio becomes a manufacturing hub for the electric vehicles and lithium-ion batteries that power vehicles, automakers will need a secure supply of raw materials to keep the assembly line moving. However, for this, minerals and metals for the batteries to be built at the planned Honda plant and other plants should not be imported from China and Russia, but should be mined and processed primarily in the United States.
Currently, there are many questions about the supply chains of battery metals such as lithium, cobalt, nickel and copper. China, the world’s top electric car maker, tightly controls the global supply of battery metals, something that was shaken during a standoff with Taiwan earlier this year and tense trade talks with China a few years ago. American automakers have every reason to worry that China could use battery metals as a geopolitical weapon to dominate the global market.
As OPEC cuts production to prop up oil prices and once again tightens the screws on US energy consumers, there is a sense that the geopolitics of the metals trade necessary for the energy transition may be as unpredictable as our dependence on the global oil cartel.
Now, what are the most beneficial things the US government can do to strengthen our mineral and metals supply chain? Will we continue to rely on belligerent countries like China and Russia for clean energy technologies, weapons systems, and materials for consumer goods? Or do we make more use of our abundant resources here in the United States?
The obvious answer: we need to not only strengthen the security of our supply chain, but also help our economy create thousands of good-paying mining and manufacturing jobs, bring millions of dollars into federal and state coffers, and reduce carbon emissions. This will reduce America’s dependence on China and Russia.
According to a recent article on mining.com, an International Energy Agency (IEA) report states that production of storage metals and minerals “needs to increase tenfold to meet mineral demand by 2030.” This will require development of hundreds of new mines.
Currently, only one lithium mine is operating in the United States. One nickel mine, one rare earth mine, one cobalt mine. And many copper deposits are depleted and resources are running out, according to the US Geological Survey.
Sticker shock for lithium has already arrived. Due to the explosive growth of electric vehicles, especially in China, the global price of lithium has increased by 678% in the past two years – and the transition to electrified transport is likely to accelerate. The IEA expects lithium demand to grow 40-fold by 2020, requiring the addition of 50 new lithium mines worldwide. But new mines aren’t being opened fast enough, and auto industry experts warn that a lithium shortage could derail electric vehicle (EV) production.
This realization convinced the White House that government action was necessary. Earlier this year, President Joe Biden used the Defense Production Act to provide loan guarantees, tax breaks and other federal aid to new domestic mines for battery metals. The Inflation Reduction Act offers EV buyers a $7,500 tax break if the vehicle’s battery contains parts of critical materials. [are] mined or processed in the United States,” reports utilitydive.com.
But building a secure supply chain doesn’t happen overnight. According to Value Walk Premium, the United States has “an estimated $6.2 trillion in mineral resources,” but the country has found it easier to import raw materials, even vital battery metals, than to build new mines. It takes a decade or more just to get government approval to open a mine in the United States – and there are so many hurdles that companies can’t get approval, and instead wind up developing new mines in other countries.
Robert W. Chase chaired the petroleum engineering and geology department at Marietta College until 2015.
Congress needs to streamline our government’s mining permit process. A bipartisan effort to cut red tape in permitting infrastructure improvements — not only mines, but also liquefied natural gas facilities and oil and gas pipelines — is advancing in the Senate. Passage of this measure will make supply chains much more secure.
It manufactures many electric cars, SUVs, pickups and trucks. Millions of cars will be sold in the next few years, many of which will be built with Ohio-made batteries. The time has come to start making better use of the mineral wealth in our nation’s backyard.
Robert W. Chase served as chair of the petroleum engineering and geology department at Marietta College for 37 years, retiring in 2015. He is a registered professional engineer in Ohio.
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