Post by
Dariusz on Dec 06, 2021 4:19am
Significance of transparent & ethical supply of REEs
Very good piece on growing significance of transparent supply of REEs;
EVs' global supply chain isn't so pretty:
Electric vehicle production plans are taking shape around the world. But the industry still
relies on some unsavory sourcing.
Even as electric vehicle production ramps up around the world, the industry is reliant on
nations with known human rights abuses and environmental violations for the batteries
needed to power EVs.
The Democratic Republic of Congo supplies about 70 percent of the world's cobalt, a key
material for today's EV batteries. But according to Wilson Center, a U.S. public policy think
tank, cobalt mines in Congo rely on about 40,000 children — some as young as 6 years
old — or about 16 percent of the 255,000 people who work in the mines. Workers are
often paid less than $2 per day.
Meanwhile, China is responsible for 90 percent of global rare-earth element supply and is
instrumental in processing raw materials for EV batteries around the world. But the
country has been under fire for its environmental practices, as evidenced by an artificial,
toxic lake in Inner Mongolia made of black sludge and hazardous chemicals that result
from rare- earth mining.
In 2015, BBC News called the "dystopian and horrifying" lake a byproduct of the world's
"tech lust."
Human rights and environmental abuses in the supply chain are likely to come under
greater scrutiny in the coming years as the demand for batteries increases. Automakers
plan to roll out dozens of new electric models between now and the end of the decade.
Much can be done in the U.S. to address those issues in the supply chain, said Abigail
Wulf, director of the Center for Critical Minerals Strategy, part of a Washington, D.C.,
nonprofit advocacy for clean U.S. energy. That includes increasing domestic mining and
processing capabilities and working with allies to source materials from elsewhere and put
pressure on other countries to clean up their practices.
"The main thing is instituting a level of radical transparency within our supply chains," Wulf
said.
She said it was important for the U.S. to build up a strong relationship with allies to ensure
that the materials used in EVs on American roadways are sourced ethically. Elected
officials in Canada, for instance, have in recent months aimed to boost mining operations
in that country to become a greater part of the supply chain.
"We want to work with our allies to try to create, whether it's a new trade deal or trade
agreement ... to commit to sourcing things that adhere to high standards," Wulf said. "And
we want to use traceability frameworks, whether it's blockchain or something else, to
prove that things actually do adhere to these standards throughout the entire supply
chain."
Automakers act:
Some automakers and suppliers have put an emphasis on addressing labor rights and
environmental issues in the EV supply chain. BMW, for instance, in 2018 began working
with a U.K. startup to use blockchain technology to ensure its EVs used only "clean
cobalt" and not materials mined with child labor, according to a Reuters report. (A BMW
spokesperson did not return a request for comment.
During the past year, Tesla, the world's largest EV manufacturer, has begun to use cobaltfree lithium-iron-phosphate batteries in many of its vehicles, and Ford and Volkswagen
have said they will do the same.
In addition to ethical reasons to move away from cobalt, auto companies see financial
incentives. Most of the world's cobalt is processed in China, where trade tension with the
U.S. remains high.
But there is also a consideration of future legal liability. Companies could find themselves
the subjects of lawsuits, as was the case in 2019, when Tesla and tech companies,
including Apple and Microsoft, were accused by a human rights nonprofit of being
complicit in the deaths of children in Congo.
‘Baby steps'
The infrastructure bill President Joe Biden signed into law in November includes
provisions aimed at boosting the nation's domestic battery production capabilities. It
includes $6 billion to foster domestic battery materials processing, manufacturing and
recycling, as well as $140 million for a domestic rare- earth demonstration facility, which
would extract and refine the materials.
Wulf said those provisions are a good start for the U.S. as it looks to become less
dependent on other countries for EV batteries.
"We need these baby steps to build up some of our capacity in the first place and then
hopefully keep it going," she said. "We want to keep the momentum going on this to make
sure that investments continue to pour in and our nascent industries continue to grow."