Critical minerals can strengthen global climate ambitions, says International Energy Agency

Critical minerals refer to metals as well as non-metals that are vital for the global economic well-being. Nonetheless, their supply can be at risk owing to geopolitical issues, trade policy, geological scarcity or other likewise factors.

Understanding critical minerals

Some critical minerals are Rare-earth elements, cobalt, magnesium, nickel, lithium, vanadium, and manganese- to name a few. These minerals are primarily used to manufacture flat screen monitors, mobile phones, wind turbines, solar panels, electric cars and several other high-tech applications.

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A report by  the U.S. Geological Survey has laid down a very interesting fact about critical minerals- the importance and the nature of a critical mineral’s supply chain can change with time. This means that a particular mineral commodity that may have been believed to be critical a few years ago is not necessarily critical right now. Similarly, another mineral commodity that is believed to be critical now may not remain so in the future.

Nonetheless, just like basic nutrients are essential for a healthy body, critical minerals are essential for a healthy economy.

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On this note, let us dig in International Energy Agency’s recent revelation that suggests that the clean energy demand for critical minerals is likely to rise as the world chases net zero goals.

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Highlights of International Energy Agency Report

Supply of critical minerals is vital for important clean energy technologies wind turbines and electric vehicles. These trends need to pick up dramatically to meet the world’s climate goals.

The report suggests that the energy sector’s total needs for critical minerals may possibly increase by six times by 2040.

The Agency’s Executive Director Fatih Birol believes that there is currently an impending gap between the globe's bolstered climate ambitions and the accessibility of critical minerals that are vital to realising those ambitions.

Governments therefore must give unambiguous signals about how they intend to turn their climate vows into action.

The reason is simple- By acting now and acting in unity, risks of price volatility and supply disruptions can be significantly reduced. If not, the clean energy future process might get slower and more costly.

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International Energy Agency Report Recommendations

The report proposes six important areas of action for policy makers to guarantee that critical minerals facilitate a faster transition to clean energy.

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  • Firstly, governments should work on their long-term obligations for emission reductions. This will make suppliers confident and instigate them to invest in and increase mineral manufacture.
  • Secondly, governments should promote technology that supports this cause.
  • Then, a scale up should be done for recycling that can ease the pressure on primary supplies.
  • The fourth recommendation is to improve supply chain strength and market transparency. Measures can comprise of frequent market assessments, strategic stockpiles, and stress-tests.
  • Moving on, a high environmental and social standard also needs to be maintained.
  • Last, but we think not the least, there is a need to improve transnational cooperation between producers as well as consumers.

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Setting an example, the U.S. Department of Energy said that it has granted USD 19 million of funding to thirteen projects dedicated on the manufacture of critical minerals and rare earth elements.

It will be interesting to watch how other nations come forward to up the ante and power their world so that we are at the forefront of a clean energy revolution.

Not to forget- the process of building clean energy products will create several jobs as well- an added advantage of this global cause.

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