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22/02/2024
Mining News

Navigating the Shift from Fossil Fuels to Clean Energy: The Vital Role of Critical Minerals in the Energy Transition

The transition from fossil fuels to clean energy sources will depend on critical energy transition minerals. Minerals – such as copper, lithium, nickel, cobalt – are essential components in many of today’s rapidly growing clean energy technologies, from wind turbines and solar panels to electric vehicles.

The consumption of these minerals could increase sixfold by 2050, according to the IEA, with their market value reaching US$400 billion, exceeding the value of all the coal extracted in 2020. To stay below 2°C by 2050, more than three billion tonnes of energy transition minerals and metals is needed to deploy wind, solar and energy storage.

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However, critical energy transition minerals come with environmental, social, economic, geopolitical, trade, and partnership challenges and opportunities.

While the growth of minerals supply plays a vital role in enabling a clean energy transition, if poorly managed, the production and processing of these minerals can lead to a myriad of negative consequences, including:

Significant greenhouse gas emissions arising from energy-intensive mining and processing activities.

Environmental impacts, including biodiversity loss and pollution.

Social impacts including human rights abuses such as child labour and negative impacts on indigenous people’s rights.

In addition, there is a supply challenge which could slow down the energy transition or make it more expensive and unequal. This is leading to high and volatile prices for critical energy transition materials, rising geopolitical tensions over their control, interference in markets, and strong political pressure to expand mining, including into environmentally and socially sensitive areas.

Responsible Mining and Sustainable Use of Critical Energy Transition Minerals

To address the intricate balance between supply and demand, we must support a just energy transition through responsible mining and circularity. This means ensuring stability in supply while reducing demand through responsible sourcing and resource circulation. Rethinking mobility, housing, and industrial systems is essential as is emphasizing material efficiency, substitutes, and circularity. Additionally, responsible extraction practices must be implemented to achieve a socially just and environmentally sustainable outcome.

Adapting Mineral Value Chains

To respond to evolving consumer, market, and investor concerns, the focus must go beyond mine sites. International cooperation, global governance, and price regulation are all topics that need to be tackled to address concerns such as equitable access, geopolitical conflicts, and market volatility.

Collaboration between stakeholders is vital to overcome these challenges and create value throughout the entire mineral value chain. It is also important that the concept of extended producer responsibility in a circular framework emphasizes the accountability of producers for the entire product lifecycle.

Enhancing Accountability and Transparency

Building trust is paramount, and this can be achieved through increased accountability and transparency across mineral value chains. Real-time and robust information, data, and knowledge are essential tools for accountability. The lack of trust between producers and consumers, as well as within local communities, can be addressed by disclosing information about extraction processes and mineral origins.

Access to meaningful product information, facilitated by innovative technologies such as blockchain and digital product passports, is crucial for informed, responsible consumer choices.

The responsible management of mineral resources is not just a matter of economic significance but a collective responsibility towards the environment, society, and future generations. By embracing sustainable practices, fostering collaboration, and leveraging technology for transparency, we can build a resilient mineral value chain that supports the clean energy transition, drives economic growth, and upholds ethical standards.

New UN Initiative to harness critical energy transition minerals for sustainable development

To support a just energy transition and accelerate the achievement of the Paris and Sustainable Development Goals, UNEP and other UN agencies – through the Secretary General’s initiative – will work with producer and consumer countries to: build trust, reliability, resilience, and benefit sharing in existing critical mineral supply chains; and support producer countries in transforming these supply chains to harness opportunities and develop their productive, trade and regulatory capacities for long-term sustainable development.

Building on existing initiatives, processes and partnerships in the UN, the initiative will focus on galvanizing system-wide UN collective action for impact at scale.

In the initial phase of the initiative, teams led by UNEP, a number of other UN agencies as well as the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development and the World Bank, will help develop the UN Framework on Just Transitions for Critical Energy Transition Minerals, which is expected by the end of 2024.

As part of this effort, during COP28, the UN Secretary-General announced his plan to set up a Panel on Critical Energy Transition Minerals composed of governments, international organizations, industry, and civil society to develop common and voluntary principles as a central element of the UN Framework.

In the initiative’s second phase, the UN Framework will be customized and tested in a number of Least Developed Countries and Land-Locked developing countries. This phase will involve developing tools, enhancing capacity, addressing legal aspects, and building skills, along with exploring options for leveraging funds.

 

Source: UN

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