Europe’s historic clean energy plan faces a mining problem

CLIMATEWIRE | Europe’s plan to reduce imports of Russian fossil fuels and speed up the production of renewable energy will test its ability to find the minerals, metals and other components needed for a dramatic shift to clean energy.

The plan, outlined by the European Commission on Wednesday, will accelerate the continent’s historic transition to wind and solar energy, while diversifying natural gas sources and increasing energy efficiency.

But it can come at a high price.

The rapid transition to renewables will depend on Europe’s ability to extract or import the materials needed for clean energy technology, such as copper, lithium and cobalt. And that’s when supply chains are straining against growing global demand for renewable energy.

“What we are talking about is to move from the volatility of hydrocarbon costs to the volatility of fixed costs for transition metals and minerals, moving from the limitations of European domestic hydrocarbon production capacity to the limitations of European domestic capacity for full production and implementation. value-chain renewables, ”said Kevin Buk, managing director of ClearView Energy Partners LLC.

“These are choices to shift the risk, and many of the details will matter,” he added.

The plan is based on a package of legislation that will reduce Europe’s greenhouse gas emissions by 55 percent by 2030 and reach net zero by the middle of the century. It aims to speed up renewable energy to 45 percent of the EU’s energy mix by 2030, up from 40 percent now. This would bring the total production of renewable energy to more than 1,200 gigawatts in eight years.

If the EU achieves its short-term goals, the European Commission estimates that it will reduce its current gas imports by two-thirds by the end of this year, with a view to putting them down well before the end of the decade.

“Today we are raising our ambition to another level to ensure that we become independent of Russian fossil fuels as soon as possible,” said European Commission President Ursula von der Leyen.

Some experts say more details will be needed to determine if these plans are achievable.

Europe may face a shortage of materials needed for its transition to clean energy, or risk developing new dependencies on unsustainable suppliers, according to recent report commissioned by the metal industry group Eurometaux and written by the Belgian-based research university KU Leuven.

He found that the EU’s zero-emission target by 2050 would require about 35% more copper and aluminum than it consumes today, and about 45% more silicon, a key component in solar panels. At the same time, the demand for lithium could increase 35 times to over 800,000 tons and up to 26 times more rare earth elements will be needed. Demand for cobalt and nickel could grow by 330% and 100%, respectively.

These materials are needed for the production of electric vehicles, batteries, wind turbines and solar panels – all of which are key to Europe’s ambitious emission reduction goals.

An international energy strategyalso published yesterday, acknowledged these risks in the supply chain.

“While the EU is determined to end its dependence on Russian energy, it is also determined to avoid new dependencies in the future,” the strategy said. “As demand for fossil fuels decreases, increased demand for raw materials, including rare earths and metals, may lead to new supply challenges during the energy transition.

The EU’s plan comes as the world approaches temperature limits, which scientists say could lead to irreversible effects on the climate. Rising seas, greenhouse gas concentrations, heat and ocean acidification reached record levels last year, according to annual report published yesterday by the World Meteorological Organization.

UN Secretary-General Antonio Guterres has responded to the report, calling for a massive influx of renewable energy.

“We need to secure, expand and diversify the supply of critical components and raw materials for renewable energy technologies,” he said, noting that raw materials and supply chains for renewable energy technologies are concentrated in a handful of countries.

“The era of renewables cannot flourish until we bridge this huge gap,” he added.

Competition for finding a source

The EU’s energy strategy lists ways to avoid future trade dependence by promoting new extraction and refining within Europe and by recycling scrap and waste. He also mentioned the potential for strategic partnerships for raw materials and trade agreements with countries in Africa and Latin America.

One challenge, especially for solar energy, will be to increase the production of solar panels and other components in Europe. As the EU plan offers funding to increase domestic production, it will be difficult to overcome the competitive advantages that pulled production from Europe and sent it to China and Southeast Asia, said Bram Kleis, senior adviser at the Non-Profit Regulatory Assistance Project. purpose. focused on the transition to clean energy.

In terms of raw materials, Europe also has the ability to supply some goods from the internal market, including aluminum and copper used in its electricity grids. But mining projects in Europe – as well as renewable buildings as offshore wind sources – are facing resistance from local communities and green groups.

Time also remains a challenge. New mines take years to be approved and developed – if they ever are. Record high energy prices could also limit the ability to refine metals used in clean energy technologies.

And on an accelerated scale, these delays matter.

“2030 is practically tomorrow in terms of infrastructure,” says the Book of ClearView Energy.

Even then, some of the minerals that Europe will need most, such as cobalt, nickel and rare earth elements, will still have to be imported. And the proposed due diligence rules, which would require EU companies to avoid human rights abuses and environmental degradation through their supply chains, could exclude some suppliers.

Then there is this barrier: Europe imports much of its copper, aluminum and nickel from Russia.

“Europe wants to diversify suppliers and speed up the circular economy, reuse and recycle materials in Europe,” said Kleis of the Regulatory Assistance Project.

Supply bottlenecks and geopolitical uncertainty can create additional challenges.

A recent report by the International Energy Agency shows that renewable energy production is on track to break world records this year. But its growth is expected to halt in 2023 due to a lack of supplies and slow licensing.

Investing in tomorrow

The plan, presented by the European Commission yesterday, extends an ambitious proposal published in March that many observers say will be difficult to achieve so quickly (ClimatewireMarch 9).

A number of other strategies were also published together with yesterday’s announcement.

one part of the plan aims to double current solar capacity to more than 320 gigawatts by 2025 and install 600 GW by the end of the decade. It will also make rooftop solar installations mandatory for commercial and public buildings from 2025 and all new residential buildings in 2029.

In addition, Denmark, Germany, Belgium and the Netherlands have pledged to increase their offshore wind capacity from 15 GW today to 150 GW by 2050, despite long permitting deadlines that have slowed winds.

The European Commission has also recommended measures that will speed up complex licensing processes and set aside “starting” areas for renewable energy sources with lower environmental risks.

“The abundance of raw materials and recycled materials is essential for the energy transition,” said Driss Akke, political director at SolarPower Europe. The group represents 260 organizations in the solar sector and calls for more investment in local production and the removal of trade barriers to facilitate access to raw materials and components for photovoltaic solar production.

Although some work has been done to determine which raw materials will be needed to meet Europe’s clean energy ambitions, “a further critical look is needed on EU raw materials for solar energy and their availability,” Akke added. .

Recycling can help.

According to a study by KU Leuven, local recycling of metals used in cars and wind turbines can provide Europe with up to 75 percent of its clean energy needs from metals, but this will not happen until 2040. After that, future growth will depend on Europe’s ability to invest in recycling operations now and prevent scrap shipments to other countries.

Labor shortages are another problem – and one that the EU plan would address through a skills training program.

“Installers across Europe and in many international markets are reporting difficulties in finding the skilled labor needed to build and install projects,” Akke said.

At the same time, as the EU strengthens its ambitions, some Member States have increased their renewable energy targets. Germany now plans to cover 100 percent of its renewable energy needs by 2035, five years earlier than originally planned. And the Netherlands plans to double its offshore wind production to almost 22 GW by 2030.

These moves will require more materials, as other parts of the world are also pushing for expanded capacity for renewables.

Solutions are available, some experts say.

“Everyone is aware of the commodity cycle we are in at the moment and the price spikes that are there. And some of these price spikes can be alleviated through a simple investment, “said John Crates, RMI’s chief program officer.

With regard to lithium, not enough capital has been invested to produce the required scale, he said. This is different from cobalt, which has concentrated reserves in several parts of the world, but has all sorts of ethical and mining issues.

“So as far as governments are focused on these issues, it’s about understanding and tracking attributes and ensuring that there is fair trade around these minerals,” Crates said.

“But more importantly, we are investing in alternatives and making sure we can innovate our way out of dependence on cobalt, nickel or some of the other metals that are currently significant constraints to the energy transition.”

Reprinted from E&E news courtesy of POLITICO, LLC. Copyright 2022. E&E News provides important news for energy and environmental professionals.