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Mineral demand dynamics in the clean energy transition: Navigating uncertainty and sustainability

The shift towards clean energy technologies, ranging from wind turbines to electric vehicles, is driving significant demand for a diverse array of minerals and metals. This chapter delves into the intricate landscape of mineral requirements across various clean energy technologies, examining scenarios outlined in the International Energy Agency’s Stated Policies Scenario (STEPS) and Sustainable Development Scenario (SDS).

Assessing mineral demand involves evaluating factors such as deployment trends, sub-technology variations, mineral intensities, and potential improvements. Projections reveal that the stringency of climate policies and technological advancements greatly influence mineral demand trajectories. Under the STEPS, mineral demand from clean energy technologies is projected to double by 2040, while it quadruples under the SDS.

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Electric vehicles (EVs) and battery storage emerge as the primary drivers of mineral demand growth, accounting for approximately half of the increase by 2040. This surge is propelled by the escalating need for battery materials, with demand skyrocketing tenfold in the STEPS and over 30 times in the SDS. Notably, minerals like graphite, copper and nickel dominate the landscape, with lithium experiencing the fastest growth rate. The transition towards lower cobalt chemistries mitigates growth in cobalt demand, largely supplanted by nickel.

Electricity networks also play a significant role, constituting 70% of current mineral demand from clean energy technologies. However, their share diminishes as technologies like EVs and storage witness rapid expansion.

Mineral demand from low-carbon power generation experiences robust growth, particularly in wind power and solar photovoltaic (PV) technologies. Wind power’s capacity additions and higher mineral intensity drive demand, while solar PV’s unparalleled scale contributes significantly, despite potential material intensity reductions.

Hydrogen emerges as a notable factor, with its increasing use under the SDS driving demand for minerals like nickel and zirconium in electrolysers and fuel cell electric vehicles.

Rare earth elements (REEs) witness substantial growth, primarily fueled by EV motors and wind turbines, highlighting the pivotal role of clean energy technologies in reshaping mineral demand dynamics.

However, projections are subject to considerable uncertainty, contingent upon varying levels of climate ambition and technological trajectories. Different scenarios could lead to vastly different demand outcomes, underscoring the need for strong policy signals and innovative measures to navigate this evolving landscape sustainably.

As clean energy technologies continue to ascend, they are poised to become the predominant force shaping mineral demand, necessitating proactive measures to ensure a reliable and sustainable mineral supply chain.

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