Are there enough minerals to build all the batteries the World needs.

APRIL 2020

AUTHORS

Ethan N. Elkind

Director, Climate Program, Center for Law, Energy & the Environment

 

Patrick R. P. Heller

Advisor, Natural Resource Governance Institute

Senior Visiting Fellow, Center for Law, Energy & the Environment

 

Ted Lamm

Climate Law & Policy Fellow, Center for Law, Energy & the Environment

 

 

CONTACT

Center for Law, Energy & the Environment (CLEE)

UC Berkeley School of Law 390 Simon Hall

Berkeley, CA 94720 clee.berkeley.edu

 

Natural Resource Governance Institute (NRGI)

80 Broad Street, Suite 1801 New York, NY 10004 resourcegovernance.org

 

DESIGN

Layout Odd Moxie

Template Studio Clear

Cover Photo Francoise Gaujour (flickr @ gaujourfrancoise)

Photography Licensed from Adobe Stock

 

 

Building a Sustainable Electric Vehicle Battery Supply Chain: Frequently Asked Questions was funded through support from the ClimateWorks Foundation.

 

 

1                                                                                                                              BUILDING A SUSTAINABLE ELECTRIC VEHICLE BATTERY SUPPLY CHAIN

CENTER F OR LA W, ENERG Y & THE ENVIRONMENT | NA TURAL RE SOURCE GO VERNANCE INSTITUTE

 

ABOUT CLEE

The Center for Law, Energy & the Environment (CLEE) channels the expertise and creativity of the Berkeley Law community into pragmatic policy solutions to environmental and energy challenges. We work with government, business, and the nonprofit sector to help solve urgent problems that require innovative and often interdisciplinary approaches. Drawing on the com- bined expertise of faculty, staff, and students across UC Berkeley, we strive to translate empir- ical findings into smart public policy solutions that better our environmental and energy gov- ernance systems.

 

ABOUT NRGI

The Natural Resource Governance Institute (NRGI) helps people to realize the benefits of their countries’ endowments of oil, gas and minerals. We do this through technical advice, ad- vocacy, applied research, policy analysis, and capacity development. We work with innovative agents of change within government ministries, civil society, the media, legislatures, the private sector, and international institutions to promote accountable and effective governance in the extractive industries.

 

 

BUILDING A SUSTAINABLE ELECTRIC VEHICLE BATTERY SUPPLY CHAIN                                                                                                                        2

CENTER F OR LA W, ENERG Y & THE ENVIRONMENT | NA TURAL RE SOURCE GO VERNANCE INSTITUTE

INTRODUCTION

As governments and private actors across the world seek to reduce greenhouse gas emissions from transportation (which exceed 15 percent of global emissions and over 40 percent of Cal- ifornia emissions1), they are predominantly turning to battery electric vehicles (EVs) as a solu- tion. When fueled by an increasingly renewable electrical grid, EVs offer the potential to signifi- cantly reduce carbon emissions compared to internal combustion engine vehicles.

A global transition from fossil fuel-powered vehicles to EVs will require the production of hun- dreds of millions of EV batteries, along with concerted efforts across policy, financing, and technological development to support demand.2 Such a massive deployment raises concerns about the availability of the minerals needed for these batteries, such as cobalt, lithium, and nickel, and the potential impact of new demand for these minerals on the lives of people in the mineral-producing countries. If managed effectively and in the public interest, the growth in these minerals can boost national development in several developing and emerging econo- mies. But realizing this potential comes with challenges, and mismanaged mineral supply chains can exacerbate local environmental and governance difficulties, while potentially undermining the EV market via supply shocks and consumer shifts away from EV brands.

In response, regulators and civil society organizations have launched efforts to increase the sustainability and transparency of the EV battery supply chain. Stakeholders across industry and government are seeking greater certainty around these efforts and what they can do to support them.

To address these questions, UC Berkeley School of Law’s Center for Law, Energy & the Envi- ronment (CLEE) and the Natural Resource Governance Institute (NRGI) are collaborating on a stakeholder-led research initiative focusing on the key barriers to, and top opportunities for, achieving greater sustainability in the EV battery supply chain.

CLEE and NRGI now offer this brief to educate decision makers and the general public about the basic informational building blocks needed to understand sustainability in the context of the EV battery supply chain. Specifically, this brief addresses the following questions (focusing in some cases on cobalt and lithium as ‘case study’ examples to highlight key issues):

• What does the supply chain for EV batteries comprise?

• How do carbon emissions from EVs compare to traditional internal combustion engine (ICE) vehicles?

• What are the most significant challenges associated with managing the mineral ex- traction processes necessary for the EV supply chain, and what sustainability and human rights initiatives apply to these challenges?

Ultimately, this brief is a preview of a full report that CLEE and NRGI will produce to identify key barriers and actionable, high-priority solutions for industry actors and government leaders to ensure a sustainable EV battery supply chain. This brief is based on existing research resourc- es and consultation with experts throughout the EV battery ecosystem, including automak- ers, battery manufacturers, mining leaders, and international human rights and sustainability organizations.3

 

 

BUILDING A SUSTAINABLE ELECTRIC VEHICLE BATTERY SUPPLY CHAIN                                                                                                                        3

CENTER F OR LA W, ENERG Y & THE ENVIRONMENT | NA TURAL RE SOURCE GO VERNANCE INSTITUTE

WHAT DOES THE EV BATTERY SUPPLY CHAIN LOOK LIKE?

 

 

ARE EVs GREENER THAN GASOLINE VEHICLES?

Since EVs do not rely directly on combustion of fossil fuels to operate, they hold a significant greenhouse gas emission advantage over traditional internal combustion engine vehicles. EV production and use is not entirely free of greenhouse gas impacts: extracting and processing minerals for batteries, producing the batteries, and generating electricity to charge them require energy inputs (often derived from fossil fuel sources) which emit greenhouse gases.

Variations in fuel sources for electricity generation where EVs are charged and driven cause significant differences in greenhouse emissions, but studies have firmly established the overall emissions advantage of EVs. Overall, some estimates place EV life-cycle emissions at approximately 50 percent fewer greenhouse gases per kilometer traveled than internal combustion engines, ranging from 25-28 percent lower in jurisdictions in which electricity supplies are fossil fuel-reliant, up to 72-85 percent lower in areas with high renewable energy penetration.4 Others estimate an emissions benefit between 19 percent at the low end (for large vehicles in China) and 60 percent at the upper end (for small vehicles in Europe).5 In the US, the average EV may achieve the emissions equivalent of approximately 88 miles per gallon while operating, which is far better than the average internal combustion engine vehicle (with significant state-by-state variation depending on electricity mix).6 Overall, the lack of transit- related emissions, coupled with the potential to utilize and support renewable energy sources, gives EVs a significant emission advantage over internal combustion engine vehicles.

Differences in battery materials and production techniques, including the location and energy mix of production, also affect the emissions profiles of different EVs.7 A battery produced in a jurisdiction using coal-fired electricity, for example, will have significantly higher emissions than one produced using cleaner power. The structure of the supply chain itself—how far battery materials are shipped from mines to refineries to manufacturing facilities—also adds to batteries’ life-cycle emissions, just as it does for petroleum. In total, analyses of battery production (including the extraction of component minerals) suggest that emissions from manufacturing an EV battery are roughly equivalent to the emissions from manufacturing the rest of the vehicle. Some experts have suggested that these emissions represent approximately 5-15 percent of the total life-cycle emissions of an EV in many places, although these estimates can vary widely.8

In addition, EV batteries’ potential use in smart charging and vehicle-to-grid applications, and the potential for second-life energy storage applications of used batteries, could play a key role in deep decarbonization of the electrical grid by enabling greater integration of renewable energy sources.9 Importantly, the potential greenhouse gas benefits of EV use will grow as firms develop new production technologies and as the overall electrical grid becomes less carbon- intensive.10 Some experts anticipate a 50 percent reduction in the life-cycle emissions of an average EV by 2030, and by one estimate of a fully renewable future grid, EVs could eventually produce at least 90 percent fewer life-cycle greenhouse gases than ICE vehicles.11 In terms of other harmful air pollutants, EVs are responsible for a fraction of the harmful pollutants such as nitrogen oxide and particulate matter that ICE vehicles emit.

 

 

5                                                                                                                             BUILDING A SUSTAINABLE ELECTRIC VEHICLE BATTERY SUPPLY CHAIN

CENTER F OR LA W, ENERG Y & THE ENVIRONMENT | NA TURAL RE SOURCE GO VERNANCE INSTITUTE

REFERENCES

1. See World Resources Institute, “World Greenhouse Gas Emissions: 2016,” available at https://www.wri.org/resources/ data-visualizations/world-greenhouse-gas-emissions-2016; California Air Resources Board, California Greenhouse Gas Emissions for 2000-2017, available at https://ww3.arb.ca.gov/ cc/inventory/pubs/reports/2000_2017/ghg_inventory_ trends_00-17.pdf.

2. Qiang Dai et al., “Life Cycle Analysis of Lithium-Ion Batteries for Automotive Applications,” Batteries 2019, 5, 48, available at https://www.mdpi.com/2313-0105/5/2/48/htm; T&E, “Life Cycle Analysis of the Climate Impact of Electric Vehicles”; ICCT, “Effects of Battery Manufacturing on Electric Vehicle Life-Cycle Greenhouse Gas Emissions; UCS, Cleaner Cars from Cradle to Grave; Hanjiro Ambrose and Alissa Kendall, “Effects of battery chemistry and performance on the life cycle greenhouse gas intensity of electric mobility,” Transportation Research Part D 47, 182-194 (2016), available at https://www.sciencedirect.com/science/article/pii/ S1361920915300390.

3. International Council on Clean Transportation (ICCT), “Effects of Battery Manufacturing on Electric Vehicle Life-Cycle Greenhouse Gas Emissions” (February 2018), available at https://theicct.org/sites/default/files/publications/EV-life- cycle-GHG_ICCT-Briefing_09022018_vF.pdf; Transport & Environment (T&E), “Life Cycle Analysis of the Climate Impact of Electric Vehicles” (October 2017), available at https://www. transportenvironment.org/sites/te/files/publications/TE%20

-%20draft%20report%20v04.pdf; Union of Concerned Scientists (UCS), Cleaner Cars from Cradle to Grave (November 2015), available at https://www.ucsusa.org/sites/ default/files/attach/2015/11/Cleaner-Cars-from-Cradle-to- Grave-full-report.pdf.

4. World Economic Forum (WEF) and Global Battery Alliance (GBA), A Vision for a Sustainable Battery Value Chain in 2030 (September 2019), p. 20, available at http://www3.weforum. org/docs/WEF_A_Vision_for_a_Sustainable_Battery_Value_ Chain_in_2030_Report.pdf.

5. UCS, “Are Electric Vehicles Really Better for the Climate? Yes. Here’s Why.” (February 11, 2020), available at https:// blog.ucsusa.org/dave-reichmuth/are-electric-vehicles-really- better-for-the-climate-yes-heres-why.

6. See, e.g., Hanjiro Ambrose et al., “Driving rural energy access: a second-life application for electric- vehicle batteries,” Environmental Research Letters 9, 094004 (2014), available at https://iopscience.iop.org/ article/10.1088/1748-9326/9/9/094004/pdf.

7. WEF and GBA, A Vision for a Sustainable Battery Value Chain in 2030, pp. 27-28.

 

 

8. Id.; Auke Hoekstra, “The Underestimated Potential of Battery Electric Vehicles to Reduce Emissions,” Joule 4, 1404 (June 2019), available at https://www.sciencedirect.com/science/ article/pii/S2542435119302715.

9. See, e.g., S.L. Winkler et al., “Vehicle criteria pollutant (PM, NOx, CO, HCs) emissions: how low should we go?” npj Climate and Atmospheric Science 1, 26 (2018), available at https:// www.nature.com/articles/s41612-018-0037-5.

10. See Indra Overland, “The geopolitics of renewable energy: Debunking four emerging myths,” Energy Research & Social Science 49 (2019), 36-40, available at https://www.sciencedirect.com/science/article/pii/ S2214629618308636; Benjamin K. Sovacool et al., “Sustainable minerals and metals for a low-carbon future,” Science Vol. 367, Issue 6473 (Jan. 3 2020), 30-33, available at https://science.sciencemag.org/content/sci/367/6473/30. full.pdf.

11. T&E, “Electric vehicle life cycle analysis and raw material availability” (Oct. 2017), available at https:// www.transportenvironment.org/sites/te/files/ publications/2017_10_EV_LCA_briefing_final.pdf.

12. United States Geological Survey (USGS), Mineral Commodity Summaries 2019, pp. 50-51, available at https://www.usgs.gov/ centers/nmic/mineral-commodity-summaries,

13. Id. at 98-99.

14. See Kostiantyn Turcheniuk et al., “Ten years left to redesign lithium-ion batteries,” Nature (July 25, 2018), available at https://www.nature.com/articles/d41586-018-05752-3/.

15. WEF and GBA, A Vision for a Sustainable Battery Value Chain in 2030, p. 29; see Stella Soon, “As electric vehicle production ramps up worldwide, a supply crunch for battery materials is looming,” CNBC (July 26, 2019), available at https://www.cnbc. com/2019/07/26/electric-car-production-rises-supply- crunch-for-battery-metals-looms.html.

16. Several international initiatives are being developed to target governance considerations and reduce potential supply bottlenecks that could impede the global energy transition. See, e.g., U.S. Department of State Bureau of Energy Resources, Energy Resource Governance Initiative, 2019, https://www.state.gov/wp-content/uploads/2019/06/ Energy-Resource-Governance-Initiative-ERGI-Fact-Sheet.  pdf.

17. See, e.g., Turcheniuk et al.

 

 

BUILDING A SUSTAINABLE ELECTRIC VEHICLE BATTERY SUPPLY CHAIN                                                                                                                                                                  14

CENTER F OR LA W, ENERG Y & THE ENVIRONMENT | NA TURAL RE SOURCE GO VERNANCE INSTITUTE

18. Benjamin K Sovacool et al.; T&E, “Electric vehicle life cycle analysis and raw material availability”; see Gavin Harper et al., “Recycling lithium-ion batteries from electric vehicles,” Nature 575(7781), 75-86 (November 2019), available at https://www.nature.com/articles/s41586-019-1682-5.pdf; WEF and GBA, A Vision for a Sustainable Battery Value Chain in 2030, p. 30-31.

19. See, e.g., Amnesty International, Profits and Loss: Mining and Human Rights in Katanga, Democratic Republic of the Congo (2013), available at https://www.amnesty.org/ download/Documents/12000/afr620012013en.pdf; Amnesty International, Mining in Guatemala: Rights at Risk (2014), available at https://www.amnesty.org/download/ Documents/4000/amr340022014en.pdf; Human Rights Watch, “What...if Something Went Wrong?”: Hazardous Child Labor in Small-Scale Gold Mining in the Philippines (2015), available at https://www.hrw.org/report/2015/09/29/ what-if-something-went-wrong/hazardous-child-labor-

small-scale-gold-mining; Human Rights Watch, “No Year without Deaths”: A Decade of Deregulation Puts Georgian Miners at Risk (2019), available at https://www. hrw.org/report/2019/08/22/no-year-without-deaths/ decade-deregulation-puts-georgian-miners-risk.

20. As examples of the mineral industry’s evolving approach to human rights and other impacts, The International Council provides several guidance documents for mining companies: on such topics as Understanding Company-Community Relations, Voluntary Principles on Security and Human Rights: Implementation Guidance Tools, Good Practice Guide on Indigenous Peoples and Mining, and Demonstrating Value: A Guide to Responsible Sourcing. See https://guidance. miningwithprinciples.com/ for these and other documents.

21. For an overview of major governance challenges associated with extractive industries, see Natural Resource Governance Institute, Natural Resource Charter (2014), available at https:// resourcegovernance.org/approach/natural-resource-charter.

22. See Amnesty International, This Is What We Die For (2016), pp. 22-24, available at https://www.amnesty.org/download/ Documents/AFR6231832016ENGLISH.PDF.

23. Enough Project, Powering Down Corruption (October 2018),

p. 19, available at https://enoughproject.org/wp-content/ uploads/PoweringDownCorruption_Enough_Oct2018-web. pdf; Amnesty International, This Is What We Die For, pp. 34-35.

24. Resource Matters, See No Evil -- Poorly Managed Corruption Risks in the Cobalt Supply Chain (2019), available at https:// resourcematters.org/see-evil-speak-evil-poorly-managed- corruption-risks-cobalt-supply-chain; Kadhim Shubber and Neil Hume, “Glencore under investigation by US commodities regulator,” Financial Times (Apr. 25, 2019), available at https://www.ft.com/content/f73b3906-6781-11e9-9adc- 98bf1d35a056; Julia Kollewe and Simon Goodley, “Serious Fraud Office investigates Glencore over suspected bribery,” The Guardian (Dec. 5, 2019), available at https://www. theguardian.com/business/2019/dec/05/serious-fraud- office-investigates-glencore-over-suspected-bribery.

25. See, e.g., Kenneth Dickerman and Simone Francescangeli, “What life is like for the teenage miners of Potosi, Bolivia,” Washington Post (Sept. 14, 2018), available at https://www. washingtonpost.com/news/in-sight/wp/2018/09/14/what- life-is-like-for-the-teenage-miners-of-potosi-bolivia/; Eniko Horvath and Amanda Romero Medina, “Indigenous people’s’ livelihoods at risk in scramble for lithium, the new white gold,” Ethical Corporation (April 9, 2019), available at http:// www.ethicalcorp.com/indigenous-peoples-livelihoods-risk- scramble-lithium-new-white-gold.

26. See, e.g., Laura Millan Lombrana, “Bolivia’s almost impossible lithium dream,” Blomberg (December 3, 2019), available at https://www.bloomberg.com/news/features/2018-12-03/ bolivia-s-almost-impossible-lithium-dream.

27. For a recent survey of some of the most severe governance challenges associated with oil extraction, see Alexandra Gillies, Crude Intentions: How Oil Corruption Contaminates the World (2020).

28. Organisation for Economic Cooperation and Development, State-owned enterprises and corruption: What are the risks and what can be done? (2018), p 28, available at https://www. oecd-ilibrary.org/governance/state-owned-enterprises-and- corruption_9789264303058-en.

29. See. e.g., USGS, Environmental Considerations Related to Mining of Nonfuel Minerals (2017), available at https:// pubs.usgs.gov/pp/1802/b/pp1802b.pdf; Earthworks and Oxfam America, Dirty Metals: Mining, Communities and the Environment (2004), available at https://earthworks. org/cms/assets/uploads/archive/files/publications/ NDG_DirtyMetalsReport_HR.pdf.

30. See, e.g., Amit Katwala, “The spiralling environmental cost of our lithium battery addiction,” Wired (August 5, 2018), available at https://www.wired.co.uk/article/ lithium-batteries-environment-impact.

31. See, e.g., Lena Mucha et al., “The hidden costs of cobalt mining,” Washington Post (February 28, 2018), available at https:// www.washingtonpost.com/news/in-sight/wp/2018/02/28/ the-cost-of-cobalt/.

 

15                                                                                           BUILDING A SUSTAINABLE ELECTRIC VEHICLE BATTERY SUPPLY CHAIN

CENTER F OR LA W, ENERG Y & THE ENVIRONMENT | NA TURAL RE SOURCE GO VERNANCE INSTITUTE

32. See Max Opray, “Nickel Mining: the hidden environmental cost of electric cars,” The Guardian (August 24, 2017), available at https://www.theguardian.com/sustainable-business/2017/ aug/24/nickel-mining-hidden-environmental-cost-electric- cars-batteries.

33. See, e.g., California Council on Science and Technology (CCST), An Independent Scientific Assessment of Well Stimulation in California, Vol. II (July 2015), available at https://ccst.us/wp- content/uploads/160708-sb4-vol-II.pdf; Los Angeles County Department of Public Health (LACDPH), Public Health and Safety Risks of Oil and Gas Facilities in Los Angeles County (February 2018), available at http://publichealth.lacounty.gov/ eh/docs/PH_OilGasFacilitiesPHSafetyRisks.pdf.

34. See, e.g., Los Angeles Times, “Chevron spills 800,000 gallons of oil and water in Kern County canyon” (July 12, 2019), available at https://www.latimes.com/local/lanow/la-me- california-oil-spill-20190712-story.html.

 

BUILDING A SUSTAINABLE ELECTRIC VEHICLE BATTERY SUPPLY CHAIN                                                                                                                                                                  16

CENTER F OR LA W, ENERG Y & THE ENVIRONMENT | NA TURAL RE SOURCE GO VERNANCE INSTITUTE

APRIL 2020

AUTHORS

Ethan N. Elkind

Director, Climate Program, Center for Law, Energy & the Environment

 

Patrick R. P. Heller

Advisor, Natural Resource Governance Institute

Senior Visiting Fellow, Center for Law, Energy & the Environment

 

Ted Lamm

Climate Law & Policy Fellow, Center for Law, Energy & the Environment

 

 

CONTACT

Center for Law, Energy & the Environment (CLEE)

UC Berkeley School of Law 390 Simon Hall

Berkeley, CA 94720 clee.berkeley.edu

 

Natural Resource Governance Institute (NRGI)

80 Broad Street, Suite 1801 New York, NY 10004 resourcegovernance.org

 

DESIGN

Layout Odd Moxie

Template Studio Clear

Cover Photo Francoise Gaujour (flickr @ gaujourfrancoise)

Photography Licensed from Adobe Stock

 

 

Building a Sustainable Electric Vehicle Battery Supply Chain: Frequently Asked Questions was funded through support from the ClimateWorks Foundation.

 

 

1                                                                                                                              BUILDING A SUSTAINABLE ELECTRIC VEHICLE BATTERY SUPPLY CHAIN

CENTER F OR LA W, ENERG Y & THE ENVIRONMENT | NA TURAL RE SOURCE GO VERNANCE INSTITUTE

 

ABOUT CLEE

The Center for Law, Energy & the Environment (CLEE) channels the expertise and creativity of the Berkeley Law community into pragmatic policy solutions to environmental and energy challenges. We work with government, business, and the nonprofit sector to help solve urgent problems that require innovative and often interdisciplinary approaches. Drawing on the com- bined expertise of faculty, staff, and students across UC Berkeley, we strive to translate empir- ical findings into smart public policy solutions that better our environmental and energy gov- ernance systems.

 

ABOUT NRGI

The Natural Resource Governance Institute (NRGI) helps people to realize the benefits of their countries’ endowments of oil, gas and minerals. We do this through technical advice, ad- vocacy, applied research, policy analysis, and capacity development. We work with innovative agents of change within government ministries, civil society, the media, legislatures, the private sector, and international institutions to promote accountable and effective governance in the extractive industries.

 

 

BUILDING A SUSTAINABLE ELECTRIC VEHICLE BATTERY SUPPLY CHAIN                                                                                                                        2

CENTER F OR LA W, ENERG Y & THE ENVIRONMENT | NA TURAL RE SOURCE GO VERNANCE INSTITUTE

INTRODUCTION

As governments and private actors across the world seek to reduce greenhouse gas emissions from transportation (which exceed 15 percent of global emissions and over 40 percent of Cal- ifornia emissions1), they are predominantly turning to battery electric vehicles (EVs) as a solu- tion. When fueled by an increasingly renewable electrical grid, EVs offer the potential to signifi- cantly reduce carbon emissions compared to internal combustion engine vehicles.

A global transition from fossil fuel-powered vehicles to EVs will require the production of hun- dreds of millions of EV batteries, along with concerted efforts across policy, financing, and technological development to support demand.2 Such a massive deployment raises concerns about the availability of the minerals needed for these batteries, such as cobalt, lithium, and nickel, and the potential impact of new demand for these minerals on the lives of people in the mineral-producing countries. If managed effectively and in the public interest, the growth in these minerals can boost national development in several developing and emerging econo- mies. But realizing this potential comes with challenges, and mismanaged mineral supply chains can exacerbate local environmental and governance difficulties, while potentially undermining the EV market via supply shocks and consumer shifts away from EV brands.

In response, regulators and civil society organizations have launched efforts to increase the sustainability and transparency of the EV battery supply chain. Stakeholders across industry and government are seeking greater certainty around these efforts and what they can do to support them.

To address these questions, UC Berkeley School of Law’s Center for Law, Energy & the Envi- ronment (CLEE) and the Natural Resource Governance Institute (NRGI) are collaborating on a stakeholder-led research initiative focusing on the key barriers to, and top opportunities for, achieving greater sustainability in the EV battery supply chain.

CLEE and NRGI now offer this brief to educate decision makers and the general public about the basic informational building blocks needed to understand sustainability in the context of the EV battery supply chain. Specifically, this brief addresses the following questions (focusing in some cases on cobalt and lithium as ‘case study’ examples to highlight key issues):

• What does the supply chain for EV batteries comprise?

• How do carbon emissions from EVs compare to traditional internal combustion engine (ICE) vehicles?

• What are the most significant challenges associated with managing the mineral ex- traction processes necessary for the EV supply chain, and what sustainability and human rights initiatives apply to these challenges?

Ultimately, this brief is a preview of a full report that CLEE and NRGI will produce to identify key barriers and actionable, high-priority solutions for industry actors and government leaders to ensure a sustainable EV battery supply chain. This brief is based on existing research resourc- es and consultation with experts throughout the EV battery ecosystem, including automak- ers, battery manufacturers, mining leaders, and international human rights and sustainability organizations.3

 

 

BUILDING A SUSTAINABLE ELECTRIC VEHICLE BATTERY SUPPLY CHAIN                                                                                                                        3

CENTER F OR LA W, ENERG Y & THE ENVIRONMENT | NA TURAL RE SOURCE GO VERNANCE INSTITUTE

WHAT DOES THE EV BATTERY SUPPLY CHAIN LOOK LIKE?

 

 

ARE EVs GREENER THAN GASOLINE VEHICLES?

Since EVs do not rely directly on combustion of fossil fuels to operate, they hold a significant greenhouse gas emission advantage over traditional internal combustion engine vehicles. EV production and use is not entirely free of greenhouse gas impacts: extracting and processing minerals for batteries, producing the batteries, and generating electricity to charge them require energy inputs (often derived from fossil fuel sources) which emit greenhouse gases.

Variations in fuel sources for electricity generation where EVs are charged and driven cause significant differences in greenhouse emissions, but studies have firmly established the overall emissions advantage of EVs. Overall, some estimates place EV life-cycle emissions at approximately 50 percent fewer greenhouse gases per kilometer traveled than internal combustion engines, ranging from 25-28 percent lower in jurisdictions in which electricity supplies are fossil fuel-reliant, up to 72-85 percent lower in areas with high renewable energy penetration.4 Others estimate an emissions benefit between 19 percent at the low end (for large vehicles in China) and 60 percent at the upper end (for small vehicles in Europe).5 In the US, the average EV may achieve the emissions equivalent of approximately 88 miles per gallon while operating, which is far better than the average internal combustion engine vehicle (with significant state-by-state variation depending on electricity mix).6 Overall, the lack of transit- related emissions, coupled with the potential to utilize and support renewable energy sources, gives EVs a significant emission advantage over internal combustion engine vehicles.

Differences in battery materials and production techniques, including the location and energy mix of production, also affect the emissions profiles of different EVs.7 A battery produced in a jurisdiction using coal-fired electricity, for example, will have significantly higher emissions than one produced using cleaner power. The structure of the supply chain itself—how far battery materials are shipped from mines to refineries to manufacturing facilities—also adds to batteries’ life-cycle emissions, just as it does for petroleum. In total, analyses of battery production (including the extraction of component minerals) suggest that emissions from manufacturing an EV battery are roughly equivalent to the emissions from manufacturing the rest of the vehicle. Some experts have suggested that these emissions represent approximately 5-15 percent of the total life-cycle emissions of an EV in many places, although these estimates can vary widely.8

In addition, EV batteries’ potential use in smart charging and vehicle-to-grid applications, and the potential for second-life energy storage applications of used batteries, could play a key role in deep decarbonization of the electrical grid by enabling greater integration of renewable energy sources.9 Importantly, the potential greenhouse gas benefits of EV use will grow as firms develop new production technologies and as the overall electrical grid becomes less carbon- intensive.10 Some experts anticipate a 50 percent reduction in the life-cycle emissions of an average EV by 2030, and by one estimate of a fully renewable future grid, EVs could eventually produce at least 90 percent fewer life-cycle greenhouse gases than ICE vehicles.11 In terms of other harmful air pollutants, EVs are responsible for a fraction of the harmful pollutants such as nitrogen oxide and particulate matter that ICE vehicles emit.

 

 

5                                                                                                                             BUILDING A SUSTAINABLE ELECTRIC VEHICLE BATTERY SUPPLY CHAIN

CENTER F OR LA W, ENERG Y & THE ENVIRONMENT | NA TURAL RE SOURCE GO VERNANCE INSTITUTE

ARE THERE ENOUGH MINERALS TO BUILD ALL THE BATTERIES THE WORLD NEEDS?

EV batteries require a number of mineral components to store and utilize electricity as fuel. Some of these minerals, such as lithium, cobalt, nickel, graphite, copper, manganese, and rare-earth elements like neodymium, are “critical” minerals for which substitutes are limited or nonexistent and supplies are geographically concentrated.13 Expert opinions differ on how likely a long-term shortage could be, particularly given changing battery technologies and chemistries that may become less reliant on these raw materials. Some experts have determined that long-term mineral supply shortages are unlikely to occur.14 For example, the U.S. Geological Survey estimated global production of cobalt at 140,000 metric tons in 2018. This compares to global reserves (i.e. those that are economically feasible to extract) of 6.9 million metric tons and terrestrial resources (i.e. known and reasonable for future extraction) of 25 million tons.15 Worldwide lithium reserves are estimated at 14 million metric tons, compared to 2018 production of 85,000 tons (and global resources of 62 million tons).16 On the other hand, analysis published in the scientific journal Nature shows that demand for essential battery components could exceed supply within decades (by 2030 for cobalt and 2037 for nickel) without further developments in battery mineral composition17. And the World Economic Forum has identified the potential for short-term supply crunches as the mining industry strives to keep pace.18

Furthermore, the process of converting mineral reserves in the ground to extracted minerals available for use in batteries involves complex legal, financial, and community factors. Developing a mine requires extensive capital investment, regulation and oversight, and a system for mitigating citizen concerns and managing stakeholder relationships in mining communities. Therefore, governance of mining and supply chains will have a major impact on the stability with which industry can bring in-ground resources to market.19

The pace of technological progress on materials recovery and recycling will also impact the shape of future minerals demand. This innovation offers the possibility of extending and diversifying supply chains. The automotive and battery industries are also investing to develop new technologies that rely on more plentiful (and cheaper) minerals. Ultimately, while demand for key minerals may grow exponentially with the market—by more than 300 percent for graphite, more than 500 percent for cobalt, and more than 900 percent for lithium by 2050— experts cannot project with certainty how technological change will impact supply chains. As a result, the potential impact of mineral supply bottlenecks in the future remains unknown.21

 

 

 

BUILDING A SUSTAINABLE ELECTRIC VEHICLE BATTERY SUPPLY CHAIN                                                                                                                        6

CENTER F OR LA W, ENERG Y & THE ENVIRONMENT | NA TURAL RE SOURCE GO VERNANCE INSTITUTE

WHERE DO KEY BATTERY MINERAL INPUTS COME FROM?