I  was recently invited to participate in a webinar hosted by Times of Malta and chaired by Mark Zammit, in collaboration with the European Commission, on the nitty-gritty of the Green Deal. I rarely shy from provocation, even when this risks upsetting the apple cart but a point I underscored during the riveting webinar was that even a supposedly pro-environmental course of action as the Green Deal exacts its negative impacts, which need to be identified upfront in order for effective mitigation of the same impacts to be possible.

For instance, one of the major thrusts of the Green Deal is its promotion of renewable energy sources and the electrification of vehicle fleets. This commendable objective is obviously key to Europe attaining an ambitious carbon neutrality by 2050.

However, there’s a catch. As rightly expounded by the International Monetary Fund (IMF), this clean energy transition could unleash an unprecedented demand for metals in the years and decades to come, to the tune of an additional three billion tons. A typical electric vehicle battery pack, for example, needs around eight kilograms of lithium, 35 kilograms of nickel, 20 kilograms of manganese and 14 kilograms of cobalt, while charging stations require substantial amounts of copper. For green power, solar panels use large quantities of copper, silicon, silver and zinc while wind turbines require iron ore, copper and aluminium.

The 2050 net zero carbon emission scenarios necessitate a tidal move away from fossil fuels, whose share in the energy market is expected to tumble from 80 to 20 per cent by 2050 while the share of renewables is expected to rise to 60 per cent (the remaining 20 per cent will potentially be contributed by a resurgent nuclear energy sector).

Given the projected increase in metals consumption through 2050 under a net zero scenario, current production rates of graphite, cobalt, vanadium and nickel appear inadequate, showing a more than two-thirds gap versus the demand.

Current copper, lithium and platinum supplies also are inadequate to satisfy future needs, with a 30 per cent to 40 per cent gap versus demand. While shortfalls for some elements (like graphite, vanadium) can be addressed through more efficient extraction at mines, for many (especially lithium and lead but also for zinc, silver and silicon) the dwindling reserves cannot be masked by improved extraction.

One way of addressing this perfect storm is through improved recycling of the same substances; reuse of scrap metals only occurs on a large scale for copper and nickel but it’s now increasing for some scarcer materials like lithium and cobalt.

One further hazard to stable supplies of the substances in question is the geographic distribution of the same, with many deposits being concentrated within a handful of countries, making supplies vulnerable to the whims of geopolitical conflicts. For instance, the Democratic Republic of the Congo (where geopolitics are perpetually volatile), for example, accounts for about 70 per cent of cobalt output and half of reserves. The role is so dominant that the energy transition could become more difficult if the country can’t expand mining operations (say, for the conservation of important ecosystems, such as rainforests).

Current copper, lithium and platinum supplies also are inadequate to satisfy future needs- Alan Deidun

Similar risks apply to China, Chile and South Africa, which are all top producers for some of the metals most crucial to the energy transition.

Given that deposits of the same rare metals on land are currently intensely-exploited and discoveries of new deposits are thin on the ground, attention of mining companies is inevitably turning to the seabed, with seabed mining in pristine deep-sea environments looming on the horizon. Bottom line is that,  parallel to price hikes for most foodstuffs as a direct consequence of the war in Ukraine, the world might experience a similar price hike in rare metals as a result of increasing demand for renewables and electric vehicles, ramping up inflation even further.

Besides the nature of the sources of the rare metals that are seminal to support the Green Deal’s implementation, one must address the ‘greenwashing’ scourge which can give false impressions about actual progress being achieved. False claims to the tune of ‘100 per cent biodegradable’, ‘climate-neutral product’ (this is simply a non-existent construct) and ‘eco-friendly’ are rife in the industry, unfortunately, with a dire need for reliable information as opposed to misleading one.

The current EU legal framework – the Consumer Rights Directive and the Unfair Commercial Practices Directive – is inadequate at stamping out such abuse. As a result, the European Commission is proposing an overhaul of both directives as well as the introduction of an initiative on Substantiating Green Claims, to make the claims reliable, comparable and verifiable across the EU as well as to limit greenwashing practices. Consumers are becoming more conscious and aware of the environmental impact of their shopping and this new EU initiative is timelier than ever.

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