Navigant Research Blog

The Cleantech Resource Boom

Anissa Dehamna — May 10, 2013

The United States may be in for another resource boom.  Data from researchers at the University of Wyoming suggests that brines in the Rock Springs Uplift in that state could contain 228,000 tons of lithium.

It’s easy to forget how reliant we are on natural resources, such as lithium, for our clean technologies.  We typically think of natural resources in concert with energy ‑ it’s hard to forget that natural gas, oil, and coal are natural resources since we literally drill and mine them out of the ground.

However, new energy technologies are also reliant on natural resources.  Certain metals are key components in clean energy technologies.

For instance, fuel cells are reliant on platinum and platinum group metals (found primarily in South Africa and Russia).  Lithium ion batteries require lithium (found primarily in China, Bolivia, and perhaps now the United States).  Rare earth metals are used in smartphones, electric vehicles, wind turbines, and oil refining.  China famously – or infamously – instituted an informal ban on exports of rare earth metals.

Blood and Treasure

The reliance on these natural resources is frequently cited as a downside of new energy technologies.  The distribution of these metals is inequitable, and demand for them creates an inherent risk to changing the energy paradigm and adopting new energy technologies.

Why risk a conflict over rare earth metals, when we have the means to keep drilling for gas?

For one thing, we alredy risk conflict daily – and spend piles of money – to develop fossil fuel resources.  In the United States, we’ve had a century and a half to perfect the science and engineering behind finding, exploiting, and delivering petroleum resources.  In contrast, it’s still early days for new energy technologies.  As these metals become more desirable and valuable, more treasure ‑ and, likely, blood ‑ will go toward exploration and production of these elements.

By way of example, in 2011, Total’s exploration budget was $2.1 billion (independent of production).   Petrobras recently announced that it would spend $236 billion over the next 5 years on oil exploration and production.  In 2013, PEMEX, Mexico’s state oil monopoly plans to spend $19.98 billion on exploration and production.  Chevron’s budget for exploration and production in 2013 is $33.03 billion.

The magnitude of these investments far outweighs that for exploitation of lithium, rare earth elements, and other resources required for new energy technologies.  Needless to say, if there’s a run on lithium for EV lithium ion battery packs – it’s likely a forward-thinking miner or two who will put some resources to finding more.

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