Relying solely on raw materials sourced within Europe could incentivise the use of cheaper, non-recyclable batteries

Relying solely on raw materials sourced within Europe could incentivise the use of cheaper, non-recyclable batteries, increasing the need to mine virgin materials to power electric vehicles, industry has said.

Rare earth metals, cobalt and nickel, are key components in lithium-ion batteries and are well-suited for reuse, which has given rise to hopes that much of Europe’s demand for these raw materials can be met through recycling rather than mining.

However, until enough end-of-life batteries enter the system to facilitate widescale reuse, it is necessary to continue mining large quantities of virgin materials to meet projected demand.

Under the proposed EU battery regulation, the use of minimum levels of recycled content for cobalt, lead, lithium, and nickel in battery manufacturing will not become mandatory until 2030.

Nickel is primarily sourced from Latin America at present, while around two-thirds of cobalt is mined in the Democratic Republic of Congo.

But concerns over poor working conditions there and potential supply disruptions have led the European Union to look for raw materials inside Europe in search of greater “strategic autonomy”.

“More than 90% of rare earth magnets are produced in China today,” reads an extract from a recent report by the EU-backed European Raw Materials Alliance.

“This high production concentration in combination with rising global political tensions and a growing Chinese domestic market demand – particularly driven by a growth in electric mobility – results in a high supply risk for these materials from a European perspective,” the alliance warned.

In addition to opening mines within EU countries, EU leaders have sought to strike deals with neighbouring countries such as Ukraine and Western Balkan nations for raw materials sourcing.

Some lawmakers have gone further and called for European automakers to favour battery chemistries that exclusively require raw materials that can be sourced from Europe.

While shifting exclusively to technology that does not require imports may seem like a solution on paper, doing so would harm efforts to create a more circular economy and may require more virgin material extraction, explained Adam McCarthy, President of the Cobalt Institute.

“The thing that makes [cobalt-free cells] attractive to purchasers is the fact that they’re much cheaper. But that also means that it’s not economical for recycling companies to recycle it, because the value of the metals is lower,” he told EURACTIV.

“So, you have this set of trade-offs where it might be helpful [at meeting a certain policy objective] in some ways, but it doesn’t necessarily mean that it’s going to be better from a new sourcing perspective.”

The Nickel Institute said that while there are world-class nickel producers in Europe, nickel sourced from outside of the EU is currently necessary to meet demand.

“Nickel mined within the EU and from sources outside of the EU complement each other. The growing demand within the EU can only be satisfied by ensuring that mine production from the EU and elsewhere go hand in hand,” a spokesperson told EURACTIV.

Green campaigners, for their part, say the status quo is much worse.

“Europe is essentially 95% supply dependent on imports of crude oil,” said Alex Keynes, a clean vehicles expert with green NGO Transport & Environment. “It’s not like the status quo is a better situation [compared to virgin materials for batteries] and for the climate our dependence on oil is obviously a disaster,” he told EURACTIV.

“The key here is for Europe to move away from oil,” he added.

Working conditions

The mining industry has faced controversy over reports of unethical working conditions in developing countries. In 2016, Amnesty International sent tremors through the tech industry when it published a report revealing that 35,000 child labourers worked at cobalt mines in the Democratic Republic of Congo.

It may be tempting for Europe to issue a blanket ban on materials from nations implicated in these abuses, but this would not solve the broader problem, according to Adam McCarthy.

“You still need to engage with the underlying issues of poverty that exists in the cobalt mining regions, because without that you’re always still going to find these issues,” he said.

McCarthy referred to the severe poverty that many children in these regions face, noting that some are the de facto head of their household and so responsible for providing an income for their family.

“It’s not just a matter of one piece of legislation tackling the problem. It has to be international cooperation, including the government of the DRC. Some people tend to simplify the issue, although it’s not just black and white. It needs a more detailed and nuanced approach to it, as we see right now,” he added.

This view was broadly shared by Alex Keynes, who argued in favour of rigorous checks rather than halting all mining activity.

“[T&E is] not calling for some kind of moratorium on metals from high-risk areas, because it would actually be, in some cases, a lot worse for the workers in the region if the companies were to blanket pull out. The solution is rather to help regulate the sector and for companies to exercise their own leverage to ensure they’re sourcing from suppliers that are not exploiting their workers,” he said.

The law would also require third party verification carried out by accredited bodies.

Green MEP Henrike Hahn called the due diligence requirements “the key element of the proposed EU batteries regulation”, arguing that verification is needed to weed out abuses in the supply chain.

“These [due diligence requirements] are intended to ensure that neither the production of batteries nor the extraction of the required materials leads to human rights violations or environmental damage,” she told EURACTIV.

“[The Greens] are calling for mandatory due diligence and the system of controls and transparency over the supply chain. That is important to us, including the chain of custody or traceability system,” she added.

Timeline

Mark Mistry, senior manager with the Nickel Institute, said the industry welcomes the due diligence requirements, seeing it as “an opportunity for companies to demonstrate that they fulfil the expectations from regulators, their customers, and civil society”.

However, he warned that the deadlines to implement the responsible sourcing requirements contained in the draft law are overly short given the complexity involved.

“We acknowledge concerns that for the EU battery regulation to be a success, it is important that responsible sourcing be implemented shortly after it enters into force. However, the timeframe needs to remain realistic to develop and implement solid, rigorous responsible sourcing frameworks before auditing takes place,” he wrote in a recent op-ed article.

In response, T&E’s Alex Keynes encouraged lawmakers to stick with the current deadlines, arguing that the due diligence requirement only requires proof that a company has started the process.

“You don’t have to show proof of result, you have to show proof of process and effort,” he said.

“European companies are at the forefront of higher social and environmental sustainability practices. A lot of companies are already implementing social supply chain due diligence policies. Many of these companies are already essentially doing a lot of this stuff,” he added.

Source: euractiv.com

EU lithium and cobalt demand becoming harsh reality for metal-rich countries

The European Commission estimates that for electric vehicle batteries and energy storage, it will need up to 18 times more lithium and five times more cobalt in 2030 compared with now, and almost 60 times more lithium and 15 times more cobalt in 2050. At the same time, the commission is proposing to “accelerate and facilitate” procedures for the approval of mining projects in the EU and its neighbours, including the resource-rich countries of Central Asia. This is how demand for rare earth metals and raw materials translates into the EU’s green ambitions and shows that the cost of EU climate neutrality is being paid by those at the other end of the supply chain.

The European Green Deal is a bit like a game of tug of war. On the one hand, the EU has laudable aims of using the deal to reach net zero carbon emissions by 2050, achieve a circular economy and reduce resource use. On the other, it will turn to countries outside the bloc to supply the raw materials needed to meet the demand for clean energy, renewables and other high-tech solutions at the forefront of its green development plans. But meeting the demands of industries and consumers at home is taking a toll on the people and nature at the other end of the supply chain, where materials are extracted. And these demands are massive.

A new Bankwatch report finds cases of environmental destruction and loss of livelihoods at metal mining and smelting operations globally, often backed by funds from the EU and other development lenders. One such example is the Oyu Tolgoi copper mine in Mongolia’s South Gobi desert. The project’s owners include EU governments via the European Bank for Reconstruction and Development and the World Bank’s International Finance Corporation, which together have lent over USD 1.4 billion.

Heavy human cost

 

As Mongolia’s flagship mine, Oyu Tolgoi is often advertised as a world-class, sustainable, safe and energy-efficient mining project that will provide copper to help meet the world’s growing communication demands. In reality, it has been subject to controversy on multiple occasions for affecting the livelihoods of herders by depleting water resources and fragmenting pasturelands.

Nomadic herders in the South Gobi were forced to relocate in 2004 from more than 20,200 hectares of pasture to make way for the mine, which threatened their livelihoods and traditional culture. In total, 11 herder families were physically displaced and 89 “economically displaced”, and qualified for compensation packages.

In 2012 and 2013, affected herders filed complaints to the International Finance Corporation’s Compliance Advisor/Ombudsman (CAO). One concerned the 2004 resettlement plan, the other demanded improved access to water and organisation of pasture resources. In 2015, Oyu Tolgoi acknowledged the “inadequacy of the resettlement process”. The herders, the Khanbogd Soum local government and the company then formed a Tripartite Council to resolve the complaints. By 2017, the Tripartite Council had signed a resolution agreement, and in March 2019, the CAO officially closed the case.

But critics argue that progress on the agreement is dubious, with only 29% of the commitments delivered on. Most commitments, including an improved monitoring programme and a 10-part Sustainable Livelihood Programme, have at least been put into motion. These include the establishment of a herder’s market and a livestock slaughter line, which can mitigate the impacts of losing traditional herding practices.

Reduced access to water

 

In addition to the loss of livelihoods, the Oyu Tolgoi project has impacted local water resources. In 2013 seven herders filed a complaint with the CAO, expressing concerns that the diversion of the Undai River might lead to the depletion of water resources in the region, as well as reducing the yield of pastureland. The claimants pressed for a stop to the diversion works and the distribution of appropriate compensation. These demands were bolstered by the independent experts panel employed by the Tripartite Council, which noted the irreversible impacts caused by the diversion works on traditional livestock husbandry. In addition to identifying issues caused by diversions, the report found that negligence in the construction of multiple wells may have contributed to the further depletion of water resources. As a result, the report points to irreversible loss of pastureland and subsequent fragmentation, which will likely continue to have significant impacts on traditional herding practices in the region. In 2017 various measures to mitigate the impacts of the Undai River diversion were agreed, such as the development of pasture management plans. The mining company committed to undertake a hydrological study of local water resources, build 12 new wells for herders based on this study, and maintain existing wells.

However, while the promised solar-powered wells were indeed built by June 2020, they were constructed without the company first conducting a hydrological study. The number of wells that Oyu Tolgoi committed to build is also significantly less than recommended.

Ending the push-pull

 

The case of Oyu Tolgoi tells a cautionary tale of how EU funding for mineral extraction has led to increased pressures on people and the environment where mines are located. Reducing pressures on locals and ecosystems must go hand in hand with the conditions placed on the most polluting industries. Getting there will require the European Commission to provide a clear vision and dedicate funds to overcome the problems related to the mining of raw materials.

The commission must incorporate policies that ensure the use of less-exploitative and toxic-safe technologies; the restoration of old mining sites; strict environmental, social and human rights due diligence for mining projects; and the right for the communities affected by the mines and surrounding facilities to have a say. The EU cannot push a European Green Deal at the expense of local communities, workers’ rights and biodiversity, especially in the face of the economic and social crises resulting from the coronavirus pandemic. This would be a raw deal.

Source: thethirdpole.net

 

 

Euro Manganese gets support from European EIT

EIT InnoEnergy a Knowledge and Innovation Community supported by the European Institute of Innovation and Technology will marshal its broad network and resources to accelerate the Chvaletice Manganese Project’s successful integration into the European Union’s battery supply chain. The group has agreed to help Euro Manganese in securing financing of up to €362 million for the commercial development of the Chvaletice Manganese Project. Potential funding sources include Europe-wide and regional grant programs as well as European project finance and economic development banks.

A recent example of the support InnoEnergy can provide is where they led the Battchain consortium submission for €1.2b of Coronavirus Recovery Funds – Infinity Lithium is in line for a €256M euro capital injection if the InnoEnergy led bid is successful. The Chvaletice Manganese Project stands to become the only primary producer of battery-grade manganese products with the potential to provide up to 50% of projected 2025 European demand for these products and 28% of its anticipated 2030 requirements. At a time when ESG (environmental, social, governance) issues are becoming increasingly important, the project also brings local environmental and social benefits. As tailings from the decommissioned mine are recycled to produce battery-grade manganese, a longstanding source of water pollution will be eliminated and high-quality jobs will be created for local communities.

Feasibility study, demonstration plant and offtake agreements pending

 

To expedite CMP and realise the benefits it brings to Europe, EIT InnoEnergy will provide initial funding of €250,000 in the company that will go towards ongoing work on a detailed feasibility study and demonstration plant, both targeted for completion by the end of 2021. These will be market-moving developments for Euro Manganese given that they will reaffirm and perhaps represent an improvement on previous expectations regarding proof of concept and commercial viability, as well as being a valuable point of reference for potential offtake partners. It is worth noting that EIT InnoEnergy will further assist Euro Manganese in securing offtake agreements with consumers of high-purity manganese products, including European electric vehicle, battery and cathode manufacturers. In particular, the feasibility study paves the way for project development, opening the door for key milestones such as financing where support from EIT will very much come to the forefront.

Source: finfeed.com

 

Finland’s mining of the raw minerals for batteries sparks environmental concerns

Finland is the only EU country whose bedrock is known to contain all the major battery minerals — including cobalt and lithium — and the Nordic nation is drawing up plans to exploit these resources in order to become a major industry player. Yet the prospect of increasing mining is controversial in sparsely populated Finland, whose vast forests, diverse wildlife and pristine lakes are prized national assets.

Lines of trucks carrying piles of rock crisscross Finland’s rugged Terrafame mine, which sits 300km below the Arctic Circle and is Europe’s largest source of nickel for electric car batteries. At the immense, 60 square kilometer site, the extracted stone is crushed, heaped into vast mounds and fed with oxygen and water through red hoses, allowing the nickel, along with some cobalt, to gradually leach out.

“Even today more than 50 percent of our turnover is coming from the electric vehicle value chain,” Terrafame CEO Joni Lukkaroinen told AFP.

As Europe looks to counter Asia’s dominance in the fast-growing sector, Finland is one of the most active member states vying for a share of the lucrative battery business, but competition between EU countries is fierce.

Environmental minefield

 

Finland’s government has promised 300 million euros ($353 million) in stimulus for battery industry this year, and seven new excavation sites are among the commercial projects now underway to try and create a “battery cluster”.  Mika Nykanen, charged with drawing up the government’s “battery strategy”, said the Nordic country’s approach “will be strongly grounded in sustainability and Finland’s climate policy goals”.  But campaigners are worried that expanding mining in Finland will destroy sensitive ecosystems.

“You simply cannot produce these minerals in an environmentally friendly way,” campaigner Antti Lankinen told AFP, standing in front of a towering pile of waste rock on the perimeter of the Terrafame site in Sotkamo, central Finland.

Lankinen has worked with the Finnish Association of Nature Conservation to try and force Terrafame to change how it stores the waste rock, which it argues can cause acid runoff into the adjacent landscape if exposed to rainwater. The mine’s previous owners, Talvivaara, were prosecuted after an ecological catastrophe in 2012 when uranium and other toxic metals leaked into local waterways.  However Joni Lukkaroinen, CEO of new owner Terrafame, said there have been no environmental issues since his firm took over the mine five years ago.

“We do have environmental impacts, but those impacts are in line with our permits,” Lukkaroinen said.

Elsewhere in Finland, campaigns have sprung up against new extraction in Lapland and in the Saimaa lake district, a tourism hotspot known for its unique wildlife.

“Lake Saimaa is Europe’s fourth largest freshwater system and is not a suitable area,” campaigner Miisa Mink told AFP, adding that four new prospecting permits have been granted in the area since May.

“If we’re not careful, sure we’ll have electric cars but we won’t have fresh water.”

A sustainable advantage

 

Yet battery industry leaders insist that Finland is a global pioneer in sustainable practices, and believe this will give it an advantage over its competitors.  Terrafame’s mining methods, for instance, create a 60 percent smaller carbon footprint than traditional practices, the firm says.  Meanwhile Finnish mines are bound by much tougher standards than in the Democratic Republic of Congo, where more than half the world’s cobalt is produced in conditions rife with child labor and human rights abuses, according to NGOs.

“There is no point buying an electric vehicle produced from raw materials that aren’t sustainable,” Finnish Minerals Group CEO Matti Hietanen said.

Despite Finland recently losing out to Sweden to host Northvolt with its $1bn “gigafactory” that is part-funded by Volkswagen, other foreign firms are choosing to locate to Finland, including Germany’s BASF and Belgium’s Umicore. Terrafame will also open a 240-million-euro refinery next year, producing enough nickel sulphate for 1 million electric vehicles, and cobalt sulphate for 300,000.

Going off-highway

 

Car technology maker Valmet Automotive is one of the few Finnish manufacturers at the top end of the battery chain, and last year opened a plant to expand its production of finished battery packs for use in cars and industrial vehicles around the globe. On its shiny factory floor, lines of robots controlled by technicians in blue overalls assemble and screw components with intricate precision into large black casings.

“Pretty much every car and every model has a unique battery,” Jyrki Nurmi, senior VP for electric vehicle systems, told AFP.

Nurmi believes one area the company can make its mark is in its “off highway” production — batteries for the heavy duty vehicles used in construction, agriculture or logistics.  Some industry watchers say that global supplies of cobalt, the most expensive of the battery minerals, are already running low and won’t stretch to meet future demand.

“We need materials out of the ground, but in the future I think a lot of our materials will come via recycling,” Nurmi said, adding that he is optimistic that his industry will become increasingly sustainable.

“It will take time,” he said, but “it will change in the future”.

Source: thejakartapost.com