As the world shifts toward cleaner energy, we see that more sustainable housing, manufacturing, and transportation are at the forefront of issues being debated. The desire for greener tech has fueled a skyrocketing demand for in-demand metals used to produce electric vehicles (EVs) and lithium batteries.
While the U.S. government has issued tax incentives and rebates for consumers and businesses to adopt greener and cleaner energy, it may not be enough to account for the shortage of manganese and other in-demand metals.
Within the next decade, if not sooner, the metals needed for generating renewable energy sources could be depleted. The diminishing supply of highly in-demand metals such as copper, nickel, cobalt, and lithium could result in a crisis of epic proportions. Subvert the dominant paradigm, right entrepreneurs? “They” say oil & gas is finite…well, so are the key materials for powering the clean transition? WTF? Yep.
Why Is There a Shortage?
As countries around the globe transition to greener energy, the increased demand for metals and rare earth elements is astronomical. There is a limited supply of these materials. But mining and recycling EV batteries currently in circulation are the only acceptable methods of sourcing these invaluable commodities. Also, as mining companies face stricter social and environmental standards, the quality and availability of mineral deposits are rapidly declining.
According to the International Energy Agency, ensuring an adequate supply of each mineral faces a unique set of challenges. Those challenges include:
1. Copper Is Hard to Substitute Because of Its Superior Properties
Mines in Australia and South America are facing high stress levels from un-forecasted weather patterns and less water. The mines currently in operation are nearing their peaks. Many existing mines have exhausted their copper reserves and are facing a drastic decline in ore quality. So the result is increased production costs and higher emissions.
2. After Years of Low Prices, Lithium Production Is Dwindling
The chemical extraction of lithium is limited to only a few regions, with China accounting for 60% of production worldwide. As demand grows at an alarming rate, smaller producers of in-demand metals cannot produce the essential element at cost-effective prices, leading to inevitable shortages.
3. Alternatives to Nickel Are Few and Far Between
There are growing concerns about higher CO2 emissions with nickel mining, and alternative supply options have proven to be cost-prohibitive. High-pressure acid leaching (HPAL) methods have been ineffective, with consistent delay and cost increases.
4. Democratic Republic of Congo (DRC) and China Are the Main Providers of Cobalt
There is considerable reliance on China and the DRC, which supplies 70% of cobalt, with few sources available outside these two countries. Since cobalt is a by-product of copper and nickel, it is heavily dependent on the mining of those minerals. Cobalt mining also faces intense scrutiny and is subject to social pressures, creating a volatile market.
What About Manganese?
The bones in the human body contain approximately 12 grams of manganese. But, since that is not enough to power electronic devices and EV batteries, the mineral has to be extracted from Earth’s core. Most of the mining activities for manganese occur in South Africa.
Approximately 90% of the manganese currently mined goes to producing stainless steel and iron. However, over the past decade, the EV battery market has developed an increased interest in the element’s metal sulfate, as it provides an essential stabilizing ingredient in NMC (nickel, manganese, and cobalt) cathodes. The composition is the driving force behind lithium-ion batteries, and it is instrumental in determining the range of the electric vehicle based on the amount of power delivered to the EV battery.
Composition of Manganese in an EV Battery
An EV battery with a 60 kWh capacity contains approximately 185 kg of minerals, with 10 kg of manganese needed to manufacture the cathode.
In 2020, 72% of NMC batteries for electric vehicles contained a cathode composed of manganese, nickel, cobalt, and lithium. For example:
- NMC811: 80% nickel, 10% cobalt, and 10% manganese
- NMC523: 50% nickel, 20% manganese, and 30% cobalt
A higher nickel content increases the amount of energy storage, increasing the driving range of an electric vehicle. Manganese and cobalt improve safety in NMC batteries, acting as a stabilizer for the chemical compound.
Demand for High-Purity Manganese
Within the next decade, analysts predict North America will need more than 200 kilotons of high-purity manganese each year. But, since there is no current processing capacity on the North American continent, cathode plants and battery gigafactories currently under development will be left without access to the essential metal.
As technology develops and the EV industry demands more high-purity manganese, the price will be impacted within the next 18 to 24 months, according to Euro Manganese CEO Matt James. He told Mining, “There’s been a build-out of manganese sulphate capacity in China and that has been enough to feed the current demands of the battery industry. But going forward, we’re going to see significant growth in both the European and North American battery industry. Both of those will require their own supply chains.”
Is Time Running Out for Manganese?
According to Visual Capitalist, the world is at extreme risk of running out of the in-demand metals needed to power renewable energy solutions “if production continues to grow at current rates.” They forecast the supply of antimony, used in manufacturing EV batteries, is already depleted. Lead used in the casings of batteries could be gone by 2025, and the indium needed to make solar panels could be non-existent by 2030, with no resources remaining. They also predict rare earth metals could be depleted before the end of the century without price changes, discoveries in mining techniques, or drastic changes in consumption.
Despite the importance of manganese in producing lithium-ion batteries for the EV industry, there are currently no mines in the United States or Canada capable of processing the critical element. That leaves North America relying on South Africa, Gabon, and China, which mined almost 80% of the manganese supply in 2021, totaling approximately 20,000 metric tons. More than 92% of the conversion capacity for high-purity manganese sulfate is in China.
Mining claims, “The high-purity manganese market may face a deficit as early as 2024.”
Increasing Demand From the EV Industry
As the demand for high-purity manganese grows, automakers such as GM, Mercedes, Volkswagen, and Tesla plan to use the in-demand metal in their electric vehicles. Chevrolet, for example, will require more than 24 kg of manganese for its popular Chevy Bolt EV.
At the opening of the Tesla Gigafactory in Germany last year, Tesla CEO Elon Musk talked about relying on manganese to increase EV battery production, claiming, “we need tens, maybe hundreds of millions of tons,” to reach the company’s production goals.
A study from IDTechEx predicts, “By 2027, an estimated 27 million electric vehicles (including HEV, PHEV, BEV, Ebus HEV, and BEV) will be on the road, up from 3 million in 2017.
In October 2022, the White House announced the American Battery Materials Initiative, unveiling an “ambitious goal for electric vehicles (EV) to make half of all new vehicles sold in 2030 electric.” The announcement presents a challenge to meet the demand for the critical in-demand metals needed for EV batteries.
Essential Elements in an EV Battery
The IEA explains, “The average electric car requires six times more minerals than a conventional ICE (Internal Combustion Engine) car.” In 2020, the average EV battery contained the following essential minerals:
- Graphite – 52 kg – 28.1%
- Aluminum – 35 kg – 18.9%
- Nickel – 29 kg – 15.7%
- Copper – 20 kg – 10.8%
- Steel – 20 kg – 10.8%
- Manganese – 10 kg – 5.4%
- Cobalt – 8 kg – 4.3%
- Lithium – 6 kg – 3.2%
- Iron – 5 kg – 2.7%
Other In-Demand Metals Facing Shortages as Demand Grows
Manganese is not the only metal at risk. The following elements essential to manufacturing EV batteries also face serious demand issues.
Copper
The in-demand metal supports wiring, batteries, rotors, electric motors, busbars, and even the charging infrastructure. A battery electric vehicle requires 83 kg (183 pounds) of copper for manufacturing. Compare this to an internal combustion engine automobile that only needs 23 kg (51 pounds). The demand for copper will see a 50% increase by 2040. With supply unable to keep up with demand, a shortage is imminent. By 2027, the EV industry will require approximately 1.74 million tons of copper to meet production demands, according to IDTechEx.
A report by BloombergNEF (BNEF) concluded, “The world may have to rely on new recycling technologies to prevent shortages of copper as the shift toward clean energy supercharges demand for the wiring material.”
Nickel
There is enough worldwide supply of nickel currently, but as EV production intensifies, there are not enough processing or mining facilities to keep up with the demand. According to CNBC, “The Eagle Mine in Michigan is the nation’s only primary nickel mine, and it’s expected to close in 2025.” Russia supplies a large amount of nickel, but since the Ukraine invasion, the price of nickel has soared to record highs.
Nickel increases density in EV batteries and must have at least 99.8% purity. Since natural ores are not this pure, the metal must go through a refining process. This can lead to potential shortages and worldwide supply disruptions.
Cobalt
It appears inevitable for a cobalt supply shortage between 2028 and 2033, according to Nature. They claim that, “even under the most technologically optimistic scenario,” the critical material faces future imbalances in supply and demand. The social and environmental concerns in the DRC relating to cobalt mining combined with escalating prices could diminish the availability of the essential metal for EV battery production.
Lithium
In the past year, lithium prices have tripled. This has led analysts to believe a shortage is near and that resources will be limited or depleted by 2025. The surging demand for the “white gold” is amplified by the amount needed to manufacture an EV battery. According to the World Economic Forum, “enough lithium was mined last year to make just under 11.4 million EV batteries.” In 2021, global EV purchases escalated to 6.6 million units, a rise of 3 million units from 2020. With this rapid growth, it is only a matter of time before lithium resources run out.
Only Time Will Tell
We need to be paying attention to this reality. It seems that we read daily about how oil & gas is finite…well so are the materials that fuel the energy transition…and it looks worse on this side. And for all of those screaming about the injustices…why are those so supportive of forcing child labor in DRC and other places to produce these materials for the energy transition?
