Many countries are seeing a shift in their energy portfolio as they diversify fossil fuel-based generation (oil, gas, coal, etc.) into renewables such as solar, wind (both off and on-shore), geothermal, tidal, and other forms of capacity.
Governments and businesses in many countries are investing huge sums in the forms of credits, grants, and direct investment to do so, with a range of intended benefits (a lower carbon footprint being top of mind). And as this sector matures, the business case for developing and deploying renewable technologies is easier to make each passing year. Countries like Germany, Sweden, and Uruguay (to pick only 3) see substantial portions of their energy (specifically electrical) provided through these systems. As an example, the latter in 2022 saw 91% of its electricity generated in this manner.
Many other countries are seeing similar patterns and development, but others are trapped at the lower end of the uptake process due to societal inertia, regulation (one example being the continued resistance to offshore and onshore wind in jurisdictions), and occasionally entrenched resistance from traditional energy suppliers. Of course, the uptake of these varied technologies, under the Clean Energy Transition, will have potentially profound effects on metal and materials demand.
According to the International Energy Agency’s ‘Net-Zero by 2050 Roadmap’ (which predicates a significant global increase in renewables) demand for critical minerals (lithium, cobalt, nickel, copper, and neodymium) will increase by 1.5 to 7 times by 2030 alone. The report also projects the market value of key energy transition minerals will more than double to $770 billion by 2040. This is a substantial amount over the base growth rate and would need to be accommodated by increased mining capacity, and increased rates of recycling.
However, right now, only certain commodities and metals have matured recycling streams (copper, nickel). Others are less developed (lithium, cobalt) but as demand grows, secondary sources of other high-grade materials should develop. MM Markets is across these issues.
Thank you, and until next time!
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