The energy transition is gathering momentum, encouraged by countries and companies alike. Over 170 countries have developed targets in relation to renewable energy, and many have included them as part of their Nationally Determined Contributions under the Paris Agreement.1 The EU is considering regulations that would require member states to achieve net zero greenhouse gas emissions by 2050.2 And companies formerly focused exclusively on carbon-intensive industries, such as Total, Equinor and BP, have stated their aims to become net-zero by 2050 (or sooner). The UN Climate Change Conference (COP26), to be held in the UK in November of this year, will put a spotlight on the energy transition and likely lead to further initiatives.
But one aspect of the commitment to fight climate change and reduce carbon emissions that has attracted less attention to date is the extent of the dependence of many parts of that transition on critical minerals. A new report from the the International Energy Agency (IEA)3 , released in early May, explains in clear terms the considerable extent to which the energy transition relies on critical minerals4 and the supply issues this poses. This aspect of the energy transition urgently needs examination by policymakers and corporate decision makers, so that steps can be taken to ensure that the commitments being made as part of the energy transition can actually be realised.
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1 International Renewable Energy Agency, World Energy Transitions Outlook: 1.5°C Pathway (Preview), March 2021, p. 4, available at https://www.irena.org/-/media/Files/IRENA/Agency/Publication/2021/March/IRENA_World_Energy_Transitions_Outlook_2021.pdf ("IRENA Report").
2 Such as the EU Climate Law Regulation currently under review, which includes a legal objective for the bloc to achieve net zero greenhouse gas emissions by 2050, Regulation of the European Parliament and of the Council on establishing the framework for achieving climate neutrality and amending Regulation (EU) 2018/1999 (European Climate Law), COM/2020/563 final, available at https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:52020PC0563 .
3 International Energy Agency, The Role of Critical Minerals in Clean Energy Transitions, May 2021, available at https://www.iea.org/reports/the-role-of-critical-minerals-in-clean-energy-transitions ("IEA Report").
4 The IEA Report has an expansive definition of critical minerals insofar as they relate to clean energy technologies. These include chromium, copper, major battery metals (lithium, nickel, cobalt, manganese and graphite), molybdenum, platinum group metals, zinc, rare earth elements and others. Annex A of the IEA Report contains a complete list.
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