Paper 2 rough draft
Sustainable finance paper 2
Introduction
As global climate change becomes increasingly severe, governments and companies are increasingly paying attention to reducing greenhouse gas emissions and turning to cleaner and sustainable energy solutions. In this context, new energy technologies, especially new energy vehicles and battery technologies, have become a key component of global carbon reduction efforts. Europe, China and the United States, the world’s largest economies, have all set ambitious carbon neutrality goals.In this transformation, new energy vehicles and battery technologies are given a central position as they provide a direct means of reducing carbon emissions from the transportation sector. Electric vehicles, by using batteries instead of fossil fuels as power, can significantly reduce the carbon emissions of the vehicle during use. In addition, advances in battery technology are critical to balancing the supply and demand of renewable energy and improving the reliability and efficiency of energy systems.
However, while new energy vehicles and batteries play an important role in driving the energy transition and reducing greenhouse gas emissions, their production processes also raise concerns about environmental impacts. Mineral mining, especially the mining of key battery materials such as lithium, cobalt, and nickel, not only consumes a large amount of resources, but also emits large amounts of carbon dioxide. Therefore, with the rapid growth of global demand for new energy vehicles and batteries, how to balance their environmental benefits and the environmental impact during the production process has become an urgent problem to be solved.
| Element(Kt) | CO2 emission(t) |
|---|---|
| copper | 4500 |
| cobalt | 15000 |
| graphite | 17000 |
| lithium | 15000 |
| managanese | 16000 |
| nickel | 18000 |
| silicon | 10200 |
Electric vehicle production: growing mineral demand and carbon emissions challenges
If the current policy status is maintained, it is expected that by 2050, electric vehicles will require a total of approximately 687,000 tons of nickel. If the “announced commitment” scenario is taken into account, this demand will increase to approximately 1,507 kilotonnes. Under the most ambitious scenario of “achieving net-zero emissions in 2050”, demand for nickel will further increase to approximately 1,609,000 tons.
Specific to various minerals, we can see that the demand for lithium increases from 122 kilotons in 2022 to 412 kilotons in 2050 under the “policy status quo” scenario. Lithium demand is expected to increase to 935 kilotonnes under the “declared commitment” scenario and to 1,006 kilotonnes under the “net-zero emissions” scenario.
The figures reflect a deepening dependence on mineral resources as global demand for electric vehicles grows. This dependence has inevitably led to an increase in mineral extraction activities, which can have significant environmental impacts. For example, the mining and processing of nickel produces approximately 18,000 metric tons of CO2 emissions for every 1,000 tons of nickel mined and processed. Every kt of lithium mined will produce more than 15,000 tons of carbon dioxide emissions. Taking into account the above forecasts for nickel and lithium demand, this suggests that the mining of nickel alone would have a huge carbon footprint on the environment under different scenarios.
It can be seen that although electric vehicles have obvious advantages in reducing carbon dioxide emissions during the operation phase, the mineral mining activities that their production process relies on are also a factor that cannot be ignored in causing environmental pressure. This contradiction highlights the need for measures to reduce the environmental impact of mineral extraction while promoting the development of the electric vehicle industry.
The environmental cost of battery storage: The trade-off between mineral extraction and carbon emissions
Battery energy storage systems are a key technology to achieve energy transition and promote the integration of renewable energy. Their demand for specific minerals is expected to grow significantly in the coming decades. Taking vanadium as an example, under the “early commercial vanadium flow battery” scenario, the demand in 2022 is 2.10 kilotons, while under the “policy status quo” scenario, the demand for vanadium will surge to 698.88 kilotons by 2050. This demand will further increase to 882.44 kilotons and 1569.49 kilotons under the “announced commitment” scenario and the “net-zero emissions by 2050” scenario respectively.Lithium demand is expected to grow from 3.40 kilotons in 2022 to 17.15 kilotons in 2050 under the “policy status quo” scenario. Under the “announced commitment” scenario, the demand for lithium is 34.65 kilotonnes, while under the “net zero emissions” scenario it reaches 72.66 kilotonnes.
The data reflects the increasing mining activity for mineral resources as demand for battery energy storage systems increases. For example, every thousand tons of lithium mined produces approximately 15,000 tons of carbon dioxide emissions. This means that, under the “net-zero emissions” scenario, lithium mining activities alone will result in more than 1,089,900 tons of CO2 emissions by 2050 (72.66 kilotonnes of lithium * 15,000 tons of CO2/kt).
So while battery storage systems play an important role in reducing the energy industry’s carbon footprint, their production and mineral extraction processes also need to be factored into overall environmental impact assessments. The challenge for the future is how to balance the demand for mineral resources in these systems with reducing the environmental impact of mining activities, including achieving more efficient resource recovery and reuse and reducing carbon emissions during the mining process.
The price behind carbon neutrality
Global carbon emissions will reach 36.8 gigatonnes (GT) in 2022, demonstrating the urgency of achieving the 2050 carbon neutrality goal. The chart shows that mining activity to manufacture EVs and batteries alone is expected to generate approximately 57.5 million tonnes by 2050 under a “net-zero emissions” scenario. To achieve carbon neutrality in 2050, it is not only necessary to transform energy consumption patterns and improve energy efficiency, but also to consider emissions across the entire supply chain, especially in the fields of electric vehicles and battery manufacturing. Measures could include improvements in mining efficiency, greater use of recycled materials, development of low- or no-carbon mining technologies, and increased investment in carbon capture. In addition, promoting sustainable mining practices, improving supply chain transparency, and regulatory measures aligned with global emissions reduction targets are also important strategies to ensure environmental and social responsibility.
Conclusion
In the context of global climate change, carbon neutrality has become a common goal of the international community. As the key to reducing carbon emissions, new energy vehicles and battery technology are increasingly important. However, this transformation is not without costs. The manufacturing process of electric vehicles and battery energy storage systems relies heavily on mineral resource extraction, which brings with it significant carbon dioxide emissions and other potential impacts on the environment. Faced with growing global demand for electric vehicles and battery energy storage systems, it is necessary to find a balance between promoting industrial development while reducing the environmental impact of mineral mining. This means we need to do more to improve mineral resource recycling rates, adopt low-carbon mining technologies, and invest more in carbon capture and storage technologies.
Data Cited:
International Energy Association. Critical Minerals Demand Dataset. IEA, 2023.
Austrian Federal Ministry of Finance. "6.2. World Production of Mineral Raw Materials by Mineral Raw Materials" in World Mining Data. AFMF, 2023.
Additional Reference:
IEA (2021), Net Zero by 2050, IEA, Paris https://www.iea.org/reports/net-zero-by-2050, Licence: CC BY 4.0
Decarbonizing copper smelting: a reliable method for carbon footprint comparison between different technologies - Metso. (n.d.). Metso. https://www.metso.com/insights/blog/mining-and-metals/decarbonizing-copper-smelting/#:~:text=For%20copper%2C%20all%20these%20amount,%2C%20this%20represents%20about%200.31%25.
TY - JOUR AU - Gao, Si AU - Gong, Xian AU - Liu, Yu AU - Zhang, Qi PY - 2018/02/21 SP - 985 EP - 990 T1 - Energy Consumption and Carbon Emission Analysis of Natural Graphite Anode Material for Lithium Batteries VL - 913 DO - 10.4028/www.scientific.net/MSF.913.985 JO - Materials Science Forum ER -