Moving to a Critical Metals Base Economy

Justin Bassi speaks to retired General Tom Middendorp - also known as the "Climate General" - about the links between climate change, defence and security. NATO has a Climate Change and Security Action Plan - it describes climate as a threat multiplier. The statement about the weaponisation of water should concern everyone.

Third Annual TRENDS-Atlantic Council Conference on “Sustainable Security: The Soft and Hard Implications of Climate Action” - 4th December 2023

The conference saw attendance from numerous officials and roughly 20 experts in politics, academia, and environmental fields from around the globe. Noteworthy attendees included Anne Witkowsky, Assistant Secretary for the Bureau of Conflict and Stabilization Operations at the United States Department of State; William Wechsler, Senior Director at the Rafik Hariri Center and Middle East Programs of the Atlantic Council; and Serge Stroobants, Director for Europe and the MENA region at the Institute for Economics and Peace.

2:33:09 Francis

"If we think about this concept of the energy transition just fundamentally in a historical context, energy, we've had multiple energy transitions through history but those were all technology induced so there's a new technology is adopted its found because its more energy dense it's easier to transport perhaps its more environmentally sustainable. It becomes accepted over time and then the government comes in to regulate it. The case of the energy transition it's completely the inverse of that. What we are doing is coming in and policy is coming in and saying we ought to change get off of the form of energy which is the foundation for much of the global economy and go to energy systems that we are trying to build the capacity to develop and what's we're not just doing that in a vacuum we're doing that in an era of greater conflict relative to some of the great power in the world. Moving from a sense of dependency on certain theaters of the world, reliance, in particular this region of the world, to others that don't. I think we still are beginning to understand what the question, what the results of this really imply. The scale of the transition is really hard to comprehend. We have to increase the mining of metals, critical minerals, depending on the mineral or metal, sixfold. What is being produced today to even start to scratch the surface. The time Horizon to achieve that outcome does not align with some of the policy targets, under the current state. My call here is for bold action. It takes 16 years form the discovery of a mine to putting it into initial operation, how is that going to align with the policy induced transition when the market isn't responding. It's a tremendous challenge that we face and capital is not being allocated appropriately at all in this space. Over lay that with the context of geopolitical conflict that's on the rise. Moving off of the energy the current fossil fuel oil economy and moving to a critical metals base economy which is what goes into an electric vehicle or a wind turbine or a solar panel, this is opening up new frontiers. The United States, Europe, Japan, Australia, others want their own resource kind of nationalism in their own supply chain. So, the effect of that is, it's going to be cheaper concept, it is creating a vulcanisation of the global economy in the commodity sector, this is highly inflationary. So, we have to scale up multiples that are on unprecedented levels at a time horizon that seems very challenging to achieve, and we have to do it in way that will no longer reply on traditional supply chains. For the United States it's especially a challenge because you know China is the world's clean energy manufacturing hub, significant amount is produced in China. Then it's back to the scarcity issue, this region is starting to lean the world in the development of green steel, green steel is very a lot of countries like to talk about it so we need to this is one of those hard to abate sectors 8% of global greenhouse gas emissions come from the steel industry, you do not have an economy without steel. So, its critical we address this question, but only 4% of the global supplies of iron ore meet the quality specifications that can feed into a green steel planet. Where is this going to come from? We really have to start figuring out some of these tough questions so we can align actions, markets and policy. We have to create the right kind of drivers to allow for this investment to occur or we're just going to keep talking.

32.28: Steven Jits Question: On climate policy under the Biden Administration as you referenced climate change has been a third pillar of the alliance (AUKUS) but given what the president elected has said about climate change and given his stated desire to wind back the inflation reduction act, can climate change realistically remain a pillar of the alliance under the president-elect and do you have any advice whatsoever for the Australian government about how it might preserve scraps of cooperations around climate change even if Donald Trump does withdraw the US as he's expected to do out of the Paris Agreement.

CK: Well, I think that the climate change, the green energy transition is underway, the private sector supports it, it's there, no turning back, other nations are committed, there are many lines of effort that it's going to take to do that. Our work in critical minerals which started under the first TRUMP administration is going to continue and become increasingly necessary. It fits with our geopolitical assessment, but it is also critical to addressing climate change. There's work that's going to be happening across the region that started during the TRUMP administration last time. So, I think this is a multifaceted effort and there are plenty of areas which we can continue to cooperate to address this challenge. Maybe not as fast or in different ways but I think the work is going to continue even if it changes some emphasis.

As of November 2024, President-elect Donald Trump's critical minerals policy for his upcoming term has not been officially detailed. However, based on his previous administration's actions and recent statements, several key priorities are anticipated:

Streamlining Permitting Processes: The Trump administration has historically advocated for expedited permitting to facilitate domestic mining and processing projects. This approach is expected to continue, aiming to reduce bureaucratic delays and promote domestic production.

Leveraging the Defense Production Act (DPA): Utilising the DPA to fund critical mineral production and processing is anticipated to remain a priority, ensuring that essential materials are available for defense and other strategic sectors.

Encouraging Private Sector Investment: The administration is likely to incentivise private investment in critical minerals, including potential tax incentives and grants, to stimulate domestic exploration, mining, and processing activities.

Leaving the Paris Agreement primarily affects international climate commitments rather than the direct sharing or distribution of critical minerals. However, it has indirect implications for how countries cooperate on critical minerals.

Reduced Cooperation on Clean Energy Supply Chains

The Paris Agreement fosters international collaboration to develop and scale clean energy technologies, many of which rely on critical minerals (e.g., lithium, cobalt, and rare earth elements for batteries, wind turbines, and solar panels).

Increased Focus on National Interests

Exiting the Paris Agreement often signals a shift toward policies emphasizing national energy independence and economic sovereignty. This could mean:

• A stronger emphasis on domestic mining and processing of critical minerals.

Potential Trade Disruptions

Countries committed to the Paris Agreement might prioritise trade relationships with other signatories that align with shared climate goals. The U.S.'s departure could:

• Complicate trade agreements or partnerships involving critical minerals, particularly with nations focused on climate-aligned industrial policies.

  
  

• Lead to tariffs or restrictions from countries implementing carbon-border adjustments or other measures linked to climate commitments.

Key Critical Minerals in SpaceX Products:

1. Lithium, Cobalt, and Nickel: These are used in rechargeable batteries for powering satellites and spacecraft like Starship and Dragon capsules. Lithium-ion batteries are especially important for the energy storage systems in spacecraft

   
   

Rare Earth Elements (REEs): These elements, including neodymium and dysprosium, are used in high-performance magnets, which are crucial for motors, sensors, and other electronic systems in spacecraft . For instance, the magnets in the rocket engines of Falcon 9 and Starship require these materials to function efficiently.

Deep Leads Rubble Mound project in northern Tasmania, showing mineralisation enriched in the valuable heavy rare earths, dysprosium and terbium.

DL130 bauxite project in north-east Tasmania, reveal strong enrichment of the super-magnet rare earth element, neodymium. Neodymium is a critical strategic metal used in magnets installed in electric vehicle engines and other industrial motors such as wind turbines. It's also used in smart phones and military electronics.