EV Transition Would Drive Copper Supply Crisis
Transitioning America's vehicle fleet to all battery-electric over the next 10 to 20 years is a priority goal of the Biden Administration, being force-fed by regulators and cheered on by supporters in Congress, environmental NGOs and some state governments such as California.
We've reported on the dangerous reliability and affordability risks to the electrical grid from adding the load from EV charging and related infrastructure, along with AI and other demand drivers, while we fail to increase generating capacity because of permitting roadblocks.
We now have new authoritative and alarming metrics on another major resource limitation to vehicle electrification: global copper production capacity falling far short of EV-driven demand.
A new study, entitled "Copper Mining and Vehicle Electrification" (International Energy Forum, May 2024: Cathles and Simon), published by researchers from the University of Michigan and Cornell University, offers some exhaustively documented and sobering projections of the amount of additional copper that must be mined just to meet organic global demand growth, before adding the additional copper needed to meet the goal of 100% manufacture of EVs by 2035. The report notes that a typical EV requires about 200 pounds of copper, compared to about 40 for an internal combustion engine (ICE)-powered vehicle.
The problem is not availability of copper ore, of which there is effectively a limitless supply. It is that copper ore mining capacity falls far short of projected demand even without EVs, with little prospect of catching up over the next couple decades. The critical limiters are the number of new copper mines that must be brought into production to supply even "business as usual" demand (organic demand growth before vehicle electrification), plus the exceptionally long average time required between resource discovery and a mine's production start-up (23 years), and the limited number of new mines that are currently going through that start-up process.
The study's analysis of scheduled mine closures, together with new mines in known stages of permitting, projects that copper mine production rates in 2030 will be roughly the same as in 2018. On the demand side, the EV-driven supply gap above and beyond "business as usual" demand is predicted at about 8 million tons per year (MTPY) by 2035, and almost 10 MTPY by 2040.
Bridging that gap would require bringing into production 19 new mines on top of the 35 new ones already required to supply "business as usual" growth, given that the average production of the top ten producing mines in operation today is about .5 MTPY. With 23 years needed from resource discovery to mine production, the outcome seems obvious: it appears that copper production capacity will be severely strained just to keep pace with conventional demand growth, before mass vehicle electrification adds to the shortage.
The number of new copper mines that must be brought into production to fill "business as usual" demand from global growth is far beyond what appears likely or even possible. According to the study, to meet projected demand before adding EVs, "115% more copper must be mined in the next 30 years than has been mined in all of human history."
The report concludes that a more rational and achievable policy goal would be to encourage vehicle manufacturing to migrate toward hybrid ICE/electric vehicles, given that a typical hybrid's copper content is roughly equal to that of a conventional ICE.
Such a transition would continue the trend to higher-mileage, lower emission vehicles without precipitating the massive copper supply disruptions and higher costs that a 100% EV mandate will force on everybody.
This all suggests that liquid fuels will remain the mainstay of our transportation system, along with the production, pipelines and refining investments and assets that underpin it.
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