The Biden administration’s plan to rely on allied nations for most of the metals needed to build electric vehicles ignores the complexity of modern mining and could prevent the United States from meeting aggressive climate targets , according to industry executives.
Reuters reported on Tuesday that President Joe Biden plans to seek overseas supplies of EV metals and focus on domestic processing of battery parts, as part of a strategy designed to appease environmentalists and counter a private engagement with miners last fall to enable more national mining. .
“The approach is deeply naïve and very dangerous for the electric vehicle supply chain in the United States,” said James Calaway, president of pioneer Ltd (INR.AX), which is developing the Rhyolite Ridge lithium project in the United States. Nevada.
Aggressive US climate targets under Biden project that about half of all new auto sales in the US will be electric by 2030 and all cars in circulation will be electric by 2040 .
“Given the administration’s timetable, they have no choice but to authorize more national mines,” said Jon Evans, managing director of Lithium Americas Corp (LAC.TO), which is developing the deposit. lithium Thacker Pass in Nevada.
Highlighting the supply challenge, the International Energy Agency predicts this month that global lithium demand will increase 40 times by 2040, while demand for cobalt and nickel will increase at least 20 times. .
Chile and Australia – the world’s two largest lithium producers – ship most of their products to Asia for processing into battery cathodes and other parts. Expecting these countries to divert existing supply chains to the United States is unrealistic, executives said.
“American manufacturing must include sourcing the raw materials necessary for manufacturing here in the United States, rather than continuing to depend on other countries for these resources,” said Kathy Graul of the proposed Twin Metals copper mine project. by Antofagasta Plc (ANTO.L) in Minnesota. .
US Secretary of Agriculture Tom Vilsack – who oversees the US Forest Service – said earlier this month he was undecided on whether to temporarily block the project.
The Biden administration temporarily blocked Rio Tinto Plc’s (RIO.L) Resolution copper project in Arizona in February, a project that, if built, would supply a quarter of US demand for red metal.
While the Biden administration may want to rely on the mineral deposits of allied countries, it will have competition from China, which is willing to pay the big dollar, industry executives said.
“The US government cannot assume that non-US rare earth producers will sell their materials through the US supply chain and not to China,” said Pini Althaus, managing director of privately-held USA Rare Earth, which develops a rare earth mine. in Texas and the construction of a battery facility in North Carolina. Rare earths are used to make magnets found in electric vehicles and most electronic devices.
The United States has no plans to abandon national mining altogether, according to Ali Zaidi, deputy national climate adviser to the White House.
Zaidi said “Building US-made electric vehicles and shipping them around the world will include the exploitation of US-made parts and resources,” including responsible research and extraction of metals from electric vehicle batteries. .
Of course, the US mining industry knows that an Allied supply will be needed. Given the automakers’ expansion plans, the United States is unlikely to be able to supply more than 30% of the lithium it needs to build electric vehicles in the country by 2030, said Joe Lowry, independent consultant to the lithium industry.
“Allies would still need to be part of the lithium supply equation,” he said.
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