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Securing reliable and affordable rare earth element supplies has become a key concern in the global clean energy transition. Some have gone so far as to rebrand lithium, the third periodic element, as “white gold” due to its central role as a “critical mineral” in clean technologies including electric vehicle batteries and renewable energy storage.
Speculation about the key role of lithium in a transitioning economy has led to some volatility in the market. Lithium prices took a nosedive in the past year due to a combination of soft EV sales and oversupply from China and Africa. However, lithium prices are expected to bounce back in the medium term, and the lithium market is expected to keep growing as decarbonization processes chug along around the world.
The International Renewable Energy Agency (IRENA) estimates that lithium demand for battery-making alone will increase by a factor of ten between 2020 and 2030. Furthermore, a 2023 report from Popular Mechanics calculated that “an electrified economy in 2030 will likely need anywhere from 250,000 to 450,000 tonnes of lithium.” That’s an insane sum. For reference, “In 2021, the world produced only 105—not 105,000—tonnes.”
In anticipation of this growth trend, countries around the world have been busily trying to shore up trade relations and reliable supply chains to ensure lithium access, as well as access to other critical metals involved in producing electric vehicle batteries such as nickel, cobalt, copper, manganese, and aluminum. But one country has dominated the rare earths market – China. China alone accounts for 85-90 percent of the world’s rare earth mine-to-metal refining, and the nation’s refineries supply 68 percent of the world’s cobalt, 65 percent of nickel, and 60 percent of EV-battery-grade lithium. As a result, a whopping 75 percent of all EV batteries are made in China.
There is significant concern that this gives Beijing too much leverage, and Western powers are scrambling to regain control. While the U.S. is home to abundant natural reserves of lithium, however, there are serious drawbacks to mining and extracting it. Lithium production is associated with serious health and environmental hazards and requires massive amounts of precious water resources. Extracting a single ton of lithium requires approximately 500,000 liters of water.
But there could be a way to source lithium and other key energy transition metals in a way that is not only better for local communities, but more sustainable for the world in general – recycling lithium-ion batteries. A new study from Stanford University shows that on an industrial scale, battery recycling is at least 58% less environmentally harmful than mining new lithium. The Stanford researchers determined that the recycling process for lithium-ion batteries emits less than half the greenhouse gases of conventional mining and refinement processes, and uses just a quarter of the water and energy required to mine new metals.
The exact greenhouse gas emissions and water impact of industrial-scale recycling would depend a lot of where the recycling plant is based, however. The plant’s green-ness is determined by the local energy mix, and impact of water usage depends on how water-stressed an area is. Battery recycling facilities will therefore have to be constructed strategically to maximize their benefit.
But the benefit of recycling does not stop at environmental stewardship. The Stanford life cycle analysis also found that expanding battery recycling could also “help relieve the long-term supply insecurity—physically and geopolitically—of critical battery minerals,” as reported by Tech Xplore.
“We’re forecast to run out of new cobalt, nickel, and lithium in the next decade,” said senior author Tarpeh. “We’ll probably just mine lower-grade minerals for a while, but 2050 and the goals we have for that year are not far away.”
Clearly, we can no longer afford to overlook the billions of kilograms of critical metals heading straight to landfills each and every year. It’s time to close the loop.
