In December, the U.S. Department of Energy (DOE) released its Critical Materials Strategy, which studied the importance of certain key raw materials in clean energy.
The Critical Materials Strategy [pdf] is the second of its kind and essentially an update from last year’s. At the heart of the study is concern over short-term supply and demand. The study reveals that materials used in clean energy technologies such as wind turbines, electric vehicles, and photovoltaic thin-film, are likely to face short-term disruptions before finding their footing again in the medium- and long-term.
The top five rare materials (out of a highlighted sixteen) connected to growing supply concerns are:
One of the problems with supply lies with China, which owns 95% of the world’s rare materials and began capping exports back in 2009. Currently, one state-owned company — Inner Mongolia Bautou Steel Rare-Earth (SHA:600111) — controls roughly 60% of the country’s supply, which enables China to control prices.
Another problem is a lack of expertise in processing these materials, especially amongst non-Chinese rare earth metal companies. Jack Lifton, founder of the industry consultancy company Technology Metals Research, told Reuters that of the 244 non-Chinese companies planning to produce rare earth metals, less than 4 percent would prove profitable.
Not exactly a substantial alternative.
Still, the DOE is hoping its three-pronged strategy of diversification, research of substitutes, and recycling will prolong the inevitable. But for the short-term, it seems likely that industry will have its disruptions.
Image credit: Perkinsn via Wikimedia