Critical Minerals for Energy
Cleaning up the energy system requires more minerals — many times more, by mass, than the fossil-fuel system it replaces. Lithium, cobalt, nickel, copper and rare earths are the binding constraints on EVs, grid storage and wind power. Supply is concentrated: the DRC mines 70% of world cobalt, Indonesia mines 50% of nickel, and China refines 60% of lithium and 90% of rare earths.
Key insights
The transition is mineral-intensive, not fuel-intensive
An electric vehicle uses roughly 6× more minerals (by mass) than an internal-combustion vehicle. A grid-scale battery installation uses orders of magnitude more lithium per MWh than fossil generation needs in mineral inputs. Wind turbines and solar panels use copper and steel and (for some configurations) rare earths. The IEA's Net Zero scenario calls for 6× more mineral demand by 2040 than 2020 levels.
Supply concentration runs higher than any oil cartel
OPEC controls ~30% of world oil production. The DRC mines ~70% of cobalt. Indonesia mines ~50% of nickel. China refines ~60% of lithium, ~70% of cobalt, ~85% of rare earths and 100% of natural graphite for batteries. The concentration is at every stage — mining, processing, manufacturing. Energy security framings have moved from oil-import dependence to mineral-import dependence.
Lithium and cobalt prices have swung violently
Spodumene-grade lithium prices rose ~10× from 2020 to late 2022 then fell back ~75% by 2024. Cobalt followed a similar but milder curve. The price volatility reflects long supply-response lags — new lithium mines take 5–10 years to develop, while battery demand has scaled in months. EV-makers have responded by shifting cathode chemistry (more LFP, less NMC) and by signing long-term offtake agreements.
Mineral demand for clean-energy technologies — 2024 vs 2050 (IEA NZE)
Million tonnes (key minerals)
Key Finding: Lithium, graphite and nickel show 5–10× increases under net-zero scenarios; copper roughly doubles.
Top producing country — share of world supply (2023)
% of mining or refining controlled by the largest country
Key Finding: Every transition-mineral supply chain has a single-country chokepoint above 50% — usually at refining stage.
Methodology & caveats
What's 'critical'?
Different countries publish 'critical' or 'strategic' mineral lists. US (50 minerals), EU (34), Japan (35), Australia (24), UK. Common criteria: economic importance, supply concentration, substitutability, recycling potential. The energy transition has pushed lithium, cobalt, nickel, manganese, graphite, copper and several rare earths to the top of every major list.
Mining vs refining
Mining produces ore concentrates; refining produces battery-grade or alloy-grade metal. The two stages can be located in different countries (DRC mines cobalt, China refines it). 'Supply concentration' figures depend on which stage is measured — refining is more concentrated than mining for most transition minerals, which is why China dominates the supply chain even where it has limited domestic deposits.
Recycling and substitution
Battery recycling is scaling (CATL, Redwood Materials, Glencore) but won't materially reduce primary demand until 2030+ — the existing EV fleet hasn't reached end-of-life. Chemistry substitution (LFP for nickel/cobalt-heavy cathodes; sodium-ion for lithium) is the more immediate lever. Aluminium can sometimes substitute for copper in transmission; magnetless motor designs reduce rare-earth dependence.