The energy transition mines of tomorrow

The ages of human history have been defined from stone to iron, from hunting to husbandry, and from industry to information. The latest change has come not through any one revolutionary commodity or tool but in an overall shift from resource consumption to one of stewardship.

"The argument could be made that, with the clean energy transition, we're exchanging a fossil fuel-based energy system with a metals-based energy system," said Scott Odell, MIT Environmental Solutions Initiative Visiting Scientist, in an interview for Ask MIT Climate.

The face of mining is rapidly changing – international climate goals set by the 2015 Paris Agreement have driven a global energy transition away from fossil fuel consumption, creating a perfect incubator for conscientious investors and green startups.

At the same time, a pending exodus of retiring workforces has created a vacuum in need of young and more tech-savvy mining talent, and today's executives are promising ambitious progress in carbon reduction numbers.

Several transitions in one

The objective of the energy transition is to reduce carbon emissions while maintaining energy access and security. But if sustainable extraction and supply chain circularity aren't developed in tandem, energy transition minerals have the potential to become a progress-negating source of emissions themselves.

"What I worry about is, if we don't solve climate change with an eye towards environmental justice, we could create more social and environmental crises for ourselves down the road," said Odell. "So, we have to do it carefully, contemplatively and intelligently."

To transform global energy production and consumption into circular and clean processes, industrial feedstocks also need to be sustainably sourced, renewable, and consistently supported throughout their complete lifecycle.

As demand for coal, oil, and gas begins to decline, the need for transition minerals will continue to grow.

The energy transition's call for a new balance of mined materials includes lithium and cobalt for batteries, silicon for solar panels, rare earth minerals like neodymium and dysprosium in the magnets of wind turbines, and copper for transmitting all that renewably sourced energy from here to there.

The Center for Strategic and International Studies predicts that around 700 million metric tons of copper will be needed by the mid-2040s-roughly the equivalent of all the copper unearthed over the past 5,000 years. Other projections from The World Bank also include a 500% increase in graphite, cobalt, and lithium production by 2050.

Overall, estimates have indicated that more than 300 new mines could be needed to extract critical minerals to prevent shortages by 2030.

A carbon trade-up

While the amount of minerals and metals needed to build clean energy systems is enormous, analysts have calculated that fossil-fueled energy requires an estimated 27 times more extracted materials. In 2021, more than 7.5 billion tons of coal was mined, while the International Energy Agency (IEA) projects that the total amount of minerals needed for clean energy technology by 2040 will be under 30 million tons.

The role of critical minerals in the clean energy transitions, a comprehensive report by the IEA, specified that even with additional mines in operation with today's imperfect global standards, the environmental impact of critical minerals acquisition is still the better deal.

"These minerals typically require much more energy to produce per unit of product than other commodities, which results in higher emissions intensity," The report said. "Nonetheless, this contribution to emissions does not negate the climate advantages of clean energy technologies when considered alongside the full life-cycle emissions of other technologies. Total lifecycle greenhouse gas emissions of EVs are around half those of internal combustion engine cars on average, with the potential for a further 25% reduction with low-carbon electricity."

Not how much, but how

The acquisition and production of transition materials will have to be done more sustainably than in previous eras by converting the mines themselves to clean energy usage, maximizing resource efficiency, opting for bio-based alternatives where possible, revisualizing waste as secondary assets, and recycling more.

Compared to extracting other materials, mining transition minerals has been energy-intensive – not to the extent that they'll negate the benefits, but certainly enough to put carbon-zero timelines at risk. To avoid this, the industry must simultaneously adopt standards and regulations to make sure mining is done in a more environmentally and socially responsible way.

"There are a lot of metals already in the system and at the end of their lifespan, we send a lot of those to the dump," Odell said.

Reducing consumption and prioritizing recycling is only the beginning.

"We're still going to need to do some digging," the MIT scientist added.

For investors, price has become interdependent with environmental, social and governance (ESG) standards, presenting a different landscape of opportunities to navigate. The case is compelling for industry leaders and countries dealing in critical minerals extraction and processing to treat sustainability and community buy-in as a crucial part of trade economics.

The IEA report indicated each mine would require its own unique playbook: "Employing a holistic approach enables an integrated assessment of the drawbacks and benefits of different project alternatives. Often there are trade-offs between different environmental objectives."

As an example, most lithium comes via brine-based extraction processes from the Lithium Triangle spanning Argentina, Bolivia, and Chile. Alternatively, countries like Australia and Canada promise the benefits of high ESG standards, faster production, a more secure supply chain, and water savings with hard rock mining of lithium from spodumene. However, the process uses electricity grids that are still fossil-fuel-reliant and three times more emissions-intensive because of it.

Global and community support

Governments, investors, and organizations have been working together increasingly to incentivize reduced-carbon processes and enforce accountability and reporting standards. Transparency has become necessary not only to prospective investors but at every step of the supply chain and to all stakeholders, including employees and local communities.

There is safety, efficiency and security in the solutions of electrification, automation and the spectrum of technological upgrades available to new and existing mines, solutions in tandem with due diligence and traceability.

The IEA report shows an optimistic trend in the mining sector.

"Announced emission reduction targets have proliferated in recent years among major mining companies, with over two-thirds of the top 20 mining companies having established emissions reduction targets for 2030," according to the report. "In addition, market-driven initiatives have pushed companies to undertake voluntary environmental impact disclosures, helping to bridge the gap between consumer and investor expectations."

But the report also warns of overlap and inconsistencies without an overarching set of standards and enforcement. "A high-level forum for co-ordination could thus play a key role in standardizing environmental and social standards."

Increased pressure from those consumers and investors has created an atmosphere of culpability, affecting reputations, access to capital, and legal liabilities. To uphold this, many leading mining companies have begun to implement new best practices, committing to active R&D propelling the innovative solutions required to address these issues.

The United Nations Environment Program co-organized a program that led to the implementation of the Global Industry Standard on Tailings Management, a key ESG component needed in order to earn trust so that new mines can be welcomed as economic opportunities without being seen as problematic.

In the last few years, several international initiatives have emerged to tackle social impacts as well. Cooperation of this kind has been crucial in ensuring companies reduce the social and human rights impacts-supporting not only the energy transition overall, but positively and measurably improving their surrounding communities and environment.

Long-term investment

Ever at risk of being snuffed out by a host of complications before they even break ground, the mines of tomorrow will play a longer game, proving that they can leave their host communities and locations better than ever before. The past ideal of borrowing a patch of land, clearing it out and covering one's tracks has evolved into one of synergistic community involvement, cultural preservation, prosperity, and meaningful expansion.

Of the more than 300 new energy transition mines needed, few are likely to be operational by 2030. Even while successfully navigating ESG issues, before mining begins there is a decade or so of establishment with an average price tag of $500 million or more in capital and labor to develop each mine.

Given these lead times, investors already used to exercising long-term strategic planning now also ensure mining projects adhere to all environmental and social regulatory requirements, and exhibit meaningful innovation and progress around sustainability. At the same time, investing in projects designed to expand production at existing mines while making them more sustainable will go a long way toward preventing supply shortfalls.

Literally going green

The attitude of recycling as an afterthought is also being revised. Reduction and rehabilitation of tailings is key - considering them as byproducts and a secondary revenue stream instead of a waste stream.

Adding to the green transition, alternative mining practices using natural processes are beginning to surface, promising to further revolutionize the industry with cleaner processing, bioleaching without chemicals, site cleanup, efficient recovery from low-grade sources, recycling and more.

Biomining utilizes microbes capable of leaching transition minerals from ores and e-waste, which could enable producers to ditch chemicals which are expensive, toxic, and difficult to work with.

Agromining (or phytomining) uses plants to absorb and store minerals from waste sites or to produce minerals at higher concentrations from otherwise unproductive soil. Incorporating agromining into mine rehabilitation has already produced promising test cases recovering nickel, cobalt, manganese, arsenic, selenium, cadmium, zinc, thallium, rare earth and platinum group elements.

The dividends come not only from a growing international economy producing clean, green materials at premium prices but also from a measurably better world.