What do EV batteries have to do with Truth and Reconciliation?
From electric cars (EVs) to solar panels — there is a particular cocktail of minerals required by the clean energy economy of the future. Production of lithium, nickel, copper, cobalt, and other key minerals will have to quadruple over the next two decades to meet the Paris target of 2°C warming. The transition is necessary, therefore the resource components are necessary — but where those minerals come from, how they are extracted and who benefits from their extraction really matters. This month we’re reflecting on how mineral extraction intersects with Indigenous Rights, Truth and Reconciliation.
See here how EVs and clean power generation compare to their fossil fuel counterparts in terms of mineral requirement. An offshore wind plant today requires 12X more mineral resources than an equivalent gas plant. Source: The Carbon Brief
What’s problematic is that the largest deposits of the most crucial minerals are within Indigenous lands … but more often than not the extraction rights are owned by someone altogether different. Cobalt gets a lot of attention because 70% of the world's supply is in the Democratic Republic of Congo, but 80% of the industrial mines are owned by Chinese companies. A giant storehouse of these minerals lies at the bottom of the Pacific Ocean, but their extraction has unknown, potentially very large environmental consequences. The mining rights on the seafloor deposits have been largely allocated to small island nations who will bear the harshest negative climate impacts — but those rights are being acquired for a fraction of their lifetime value by foreign companies. And here in Canada, a huge, remote area in northwestern Ontario known as the Ring of Fire holds massive deposits of nickel, copper, platinum and palladium underneath an expanse of undisturbed peatland that is storing as much or more carbon than would be mitigated by the EV production the minerals could facilitate. The interests of mining companies and the Ontario government are in legal combat over the Indigenous rights that control the area.
They say history doesn’t repeat but it rhymes. The world is at the precipice of repeating the same colonial, extractive paradigm that defined the fossil fuel age. To facilitate a just and equitable transition to a clean economy, we have to change our thinking about how we consume resources.
The good news is that there are a number of innovators and start-ups deploying solutions that make the use of resources more efficient or completely change the composition of what’s needed EV/battery related issues can be addressed by innovating the battery supply chain:
Redesign without the need for precious metals, like batteries made with seawater or thermal batteries,
Reduce the battery capacity needed like battery swapping or integrating novel solar panels into the design of EVs to charge while driving,
Redeploy used EV batteries for energy storage broadly, and
Recycle materials and responsibly manage batteries at the end of life.
Innovations alone won’t ensure that the value created from mineral extraction is shared equitably, but as impact investors we think deeply about how the companies and industries we invest in can create systemic positive change — for the climate and society. The clean transition is an exceptionally rare opportunity to recalibrate all industries, beyond just climate tech, to make sure we utilize the resources we have in the best way possible and to integrate the values of justice, equity and reconciliation.