As metal costs continue to rise, reports are surfacing that relying on renewable energy will only make the U.S. more dependent on China due to that country's domination of the metals industry.
According to a Globe Banner report, the International Monetary Fund (IMF) said that the desire for clean energy carries the possibility of spiking prices for core metals — such as copper, nickel, cobalt, and lithium — for the foreseeable future as a result of many countries across the world pushing climate initiatives.
The report said that the demand for these metals might be unprecedented: “Prices could reach historical peaks for an unprecedented length of time – and even delay the energy transition itself.”
The IMF article estimates that one metric ton of lithium, which currently costs around $6,000, could surge to $15,000 by the end of the decade and continue to stay relatively high in the 2030’s.
IMF is predicting price increases under the net-zero emissions scenario intended to take effect by 2040, according to Globe Banner, and the metals boom could bring substantial economic gain to companies that are involved in exporting these key metals.
The IMF proposed that global “mandates” involving these key metals should “play a key role in data dissemination and analysis, setting industry standards, and fostering global cooperation,” according to Globe Banner.
The Institute for Energy Research said that the country’s departure from Afghanistan could give China a pipeline to the region estimated to be sitting on mineral reserves valued as high as $3 trillion, Globe Banner reported. The Afghan area has a 30% global market share for lithium, according to the International Energy Agency.
“The chaos may offer China, which dominates the world market for rare earths widely used in technology, to step in to develop the mineral reserves, which also include lithium, used in the manufacture of batteries,” MarketWatch said.
The United States and China issued a joint pledge as a result of COP26 to reduce their emissions in the coming years. However, the deal lacks specifics, according to NPR.