India must act on mining and exploration of critical minerals for green technologies
The COP26 meeting held in Glasgow on climate change issues discussed accelerating action and strategies to achieve the goals set out in the Paris Agreement. Therefore, India has pledged to increase its non-fossil energy capacity to 500 GW by 2030, reduce the carbon intensity of the economy to less than 45% by 2030 from 2005 levels and achieve net zero emissions by 2070. , in 2015, India announced its Nationally Determined Contributions, including reducing the emissions intensity of its Gross Domestic Product (GDP) from 33 to 35 % in 2030 compared to 2005 levels. This commitment was revised to 45% at COP26. Critical minerals must play an important role in achieving these goals.
Critical minerals refer to mineral resources, both primary and processed, which are essential inputs in the production process of an economy and the supply of which is susceptible to disruption due to unavailability or risks of surge in minerals. unaffordable prices.
These minerals tend to lack substitutability and recycling processes. In addition, the global concentration of mining and processing activities, governance regimes and environmental footprints in resource-rich countries negatively impact their availability risks.
A recent CSEP study assesses the criticality of 23 selected non-combustible minerals to India’s manufacturing sector and forecasts their requirements for manufacturing green technology equipment required for climate change mitigation. Climate change
The study assessed the criticality of each mineral along two dimensions: economic importance and supply risk. It projected India’s mineral needs for renewable electricity generation and electric vehicle manufacturing, in line with its various climate change mitigation goals over the next two decades.
The economic significance dimension measures the impact on manufacturing sectors of a sudden unavailability of a mineral in the supply chain, and the supply risk dimension assesses the vulnerability of global mineral supply chains. due to the concentration of mining or processing of minerals in certain countries. countries and the quality of governance in those jurisdictions.
Our analysis suggests that niobium, lithium and strontium are of relatively high economic importance. Lithium, for example, is essential for making batteries for electric vehicles, while niobium and strontium are needed for steel and aluminum alloys. Most minerals have some degree of substitutability, with the exception of niobium and silver, for which there are no good substitutes. Supply risk is relatively high for yttrium and scandium, followed by niobium and silicon. Silicon is essential for the manufacture of solar panels. The rare earth elements of yttrium and scandium have a variety of uses, including alloys, superconductors, and battery technologies. India lacks the recycling capacity for most minerals except copper and iron. Although there are limited technological options for recycling some minerals, there is scope to increase end-of-life recycling, as evidenced by higher recycling rates globally.
One facet of India’s future critical mineral needs will depend on the types of clean energy technologies used in the green energy transition and the share of domestic manufacturing versus import dependency of each technology. Solar and wind power will play a major role in India’s clean energy transition, and electric vehicles are also being promoted to reduce vehicle emissions and reliance on fossil fuels.
There will be an increase in demand for several critical minerals as India shifts to renewable energy generation and electric vehicles. For example, copper, manganese, zinc and indium will be needed to manufacture renewable electricity generation equipment. Similarly, the shift to electric vehicles would require increasing amounts of various minerals, including copper, lithium, cobalt and rare earths. However, India has no known reserves of nickel, cobalt, molybdenum, rare earth elements, neodymium and indium, and copper and silver requirements are expected to exceed current reserves of India.
The results of this projection exercise indicate that India is not equipped to meet its green technology manufacturing needs solely through domestic mining. Instead, imports of minerals for domestic manufacturing, or imports of the final product (embodied in those minerals), will be needed to meet its policy agenda on climate change mitigation.
While India will have to rely on imports for these technologies over the next two decades, more efforts need to be made to better utilize the minerals available in the country for its longer term needs. India can be better prepared for the next stage of using green technologies by laying the foundations for exploration and mining. India has significant resources of nickel, cobalt, molybdenum and heavy rare earth elements, but further exploration would be needed to assess the economically exploitable resources. The country must also focus on securing supply chains for critical minerals and acquiring foreign mining assets to ensure continued supply.
India will also need to undertake serious research and establish a policy framework to become self-sufficient in clean energy and high-tech equipment by moving swiftly on the exploration and extraction of critical minerals and putting in place investments in downstream value chains of required manufacturing equipment. at home.
(The study was written by Rajesh Chadha and Ganesh Sivamani, CSEP)