Copper is the new “gold.” Driven by its use in clean energy technologies, copper has doubled in price in the past year, and Bank of America says it could double again by 2025. Copper has become extremely valuable — more than $10,000 a ton.
But we have a serious problem, with potentially harmful effects on everything from electric vehicle production to the deployment of renewables. There isn’t enough copper to go around, not with construction companies competing with auto manufacturers and producers of semiconductor wiring for the same limited supply.
Copper supplies can’t keep pace with fast-growing demand, largely because there are few major copper mines in development and many existing mines are nearing peak capacity. Recycling can’t meet all of the copper needed for the burgeoning demands of industrial production.
A new report from the International Energy Agency on the mineral foundations of the energy transition warns copper demand could double by 2040. Copper is the irreplaceable arteries and veins of an electrified, low-carbon future. For example, an EV battery contains 90 pounds of copper, and a single wind turbine requires 8,000 pounds of copper. Not only is domestic production insufficient to meet the growth in future demand for copper, the world’s major producers — Chile, Peru and China — are struggling to meet the scale of the challenge.
Skyrocketing demand for copper is emblematic of what’s happening with other metals and minerals essential to advanced energy technologies. The same report from the IEA projects global lithium demand from EVs to jump fortyfold by 2040. Demand for graphite, nickel and cobalt could jump twentyfold or more.
While demand for the metals of our energy future is poised to soar, the U.S. is poorly positioned to respond. U.S. imports of metals and minerals have doubled in the past 20 years despite vast domestic mineral resources.
Today, imports account for 30 percent of the copper used in this country, but they’re far greater for some other critically important metals that are the building blocks for clean energy technologies. The U.S. now finds itself import-reliant on nearly 50 key minerals and metals. If supply chains can’t meet skyrocketing demand, mineral shortages or sky-high prices could mean a throttling of clean energy deployment. It also means U.S. manufacturers will find themselves increasingly uncompetitive in cutthroat global markets.
In opposition to U.S. mineral vulnerability, China has come to dominate mineral supply chains and the manufacturing of clean energy technologies. Beijing has made mining and mineral processing a favored industry and has effectively used control of these essential materials to corner the market on the production of everything from solar panels and wind turbines to now lithium-ion batteries, the very heart of the electric vehicle revolution. U.S. neglect of mineral supply chains is now jeopardizing the future of millions of manufacturing and advanced energy jobs — the very jobs the Biden administration is so determined to win.
Our elected leaders need to speak out against mineral import dependence. It is past time to link U.S. mining policy directly to energy policy. The opening of new mines under world-leading environmental standards employing American workers should go hand in hand with accelerating efforts to deploy EVs, build new electricity transmission lines and integrate more wind and solar power.
The U.S. has considerable mineral resources, including world-class copper and lithium reserves. Reducing barriers to mining investment and standing up new production must be given the same focus as reshoring American manufacturing. Failure to rebuild America’s industrial base from the mine up could very well mean failure to rebuild it at all.