As companies and countries around the world prioritize renewable energy and technology, the term “critical materials” comes up more and more. But what exactly are critical materials? And why should we care about them, especially in relation to clean energy, electric vehicles and smart cities??
In this blog post, we’re diving into the world of critical materials, with a special spotlight on how they’re shaping the future of the energy transition and our daily lives.
Though there is no universally accepted definition, the term “critical materials” generally refers to minerals, elements, substances or materials of high economic importance, that serve an essential function in one or more energy technologies, with a high risk of supply chain disruption due to their concentration of sources and lack of good, affordable substitutes.. Among these, the so-called “Electric 18” stand out for their important role in producing EVs, renewable energy technologies and other high-tech applications.
A very visible example of the importance of critical materials can be found in the automotive industry. As the global automotive industry shifts from traditional gas-powered cars to electric ones, demand for these materials has soared. This shift isn’t just about switching to a different type of vehicle; it represents a fundamental change in the materials and technologies that drive transportation. Electric vehicles (EVs) rely heavily on materials like lithium, cobalt and other minerals to create efficient, powerful batteries and motors. Without these critical materials, the EV revolution simply wouldn’t be possible.
To understand the full picture of critical materials, we have to go beyond acknowledging their role in today’s technologies to consider the global, environmental, and economic impacts of mining, utilizing and recycling these materials. As we continue to uncover the potential of renewable energy technologies, the conversation around critical materials is set to expand. Let’s get into it.
What are examples of critical materials?
Like there is no universally accepted definition, there is not a singular list when it comes to identifying critical materials.
There’s an “electric 18” list of critical materials for energy and a US-based list featuring 50 critical minerals. The International Energy Agency identifies 37 critical minerals, including six key to the clean energy transition: copper, cobalt, lithium, nickel, graphite, rare earth elements.
Each of these critical minerals impact transformative technologies including superconductors, powering supercomputers, and are essential components in many of today’s rapidly growing clean energy technologies such as wind farms, electricity networks, solar photovoltaic plants, and EVs.
Why are critical materials important?
The critical role of materials in the advancement of clean energy technologies cannot be overstated. Materials such as lithium, cobalt, nickel and rare earth elements are the backbone of renewable energy systems, including solar plants, wind farms and batteries.
These materials are indispensable. Their unique properties enable high efficiency and performance in energy generation, conversion and storage, making them critical for achieving global energy transition goals. However, the limited geographical distribution of these materials, coupled with the growing demand, underscores the importance of sustainable and responsible mining practices. Ensuring a steady, socially responsible and environmentally friendly supply of these critical materials is a challenge we must balance with persistent risk of supply chain disruption brought on by reliance on these materials.
Factors such as geopolitical tensions, trade disputes and stringent regulatory environments can affect the availability and price of in-demand materials. And the concentration of material production in a few countries adds a layer of vulnerability, making global supply chains susceptible to regional instabilities and policies that can restrict access to these crucial inputs. Strengthening the resilience of supply chains is vital to securing the future of clean energy technologies and ensuring that the transition to a more sustainable energy future is not hindered by material supply constraints.
Critical materials for the energy transition
Imagine for a moment that the critical materials are superheroes of renewable energy technologies, powering batteries, solar panels, wind turbines and more with their unique properties that make energy conversion and storage super-efficient. But, like any superhero, they need to be managed responsibly since they are not available everywhere … and the demand for them is growing fast.
That’s why it’s so important to work on making supply chains stronger by exploring new materials and technologies to ensure we can smoothly transition to a sustainable energy future.
What is the Critical Raw Materials Act?
Announced in 2022, the European Union’s Critical Raw Materials Act is a significant step toward securing essential raw materials for a sustainable and digital future. Demand for rare earth metals and critical materials in the EU is projected to rise six-fold by 2030 and seven-fold by 2050. In an effort to reach ambitious goals for sustainability and digital transformation, the act aims to reduce reliance on imports from sensitive regions by promoting domestic production, boosting recycling efforts and fostering global partnerships. Through the Critical Raw Materials Act, the EU aims to strengthen its industrial competitiveness and technological leadership, while also supporting its green and digital transition goals in a friendly and sustainable manner.
Europe is not alone. Other countries have also enacted regulations. In the United States, the Inflation Reduction act and Bipartisan Infrastructure Law promote recycling and sustainable use of critical materials. China’s 14thh Five-Year Plan for Circular Economy Development offers an outline for more efficient resource utilization.
Critical materials recycling
Recycling critical materials from used batteries and electronics is essential for sustainable development and environmental protection. As the demand for electronic devices and electric vehicles continues to surge, so does the necessity for materials like lithium, cobalt and nickel. Unfortunately, these resources are finite, and their extraction can have significant environmental and societal impacts. Recycling offers a solution to these challenges by reducing waste, decreasing carbon footprints, and lessening dependency on mining, with recycled quantities of copper and cobalt expected to cut mining needs of these minerals by 30% each, and recycled lithium and nickel projected to reduce mining needs of these minerals by 15% each by 2040.
Moreover, recycling critical materials conserves energy and resources, as reclaiming metals from used products requires less energy compared to mining and processing raw materials. It also helps in mitigating the risk of supply shortages and stabilizing prices, which is vital for the electronics and automotive industries. However, achieving efficient recycling requires advanced technologies and systems to effectively collect, sort and process used electronics or batteries. It also calls for global cooperation among stakeholders – including governments, industries and consumers – to create a circular economy in which materials are reused and recycled, turning waste into valuable resources and fostering a more sustainable future.
Recycling and reusing critical materials from electronics and batteries pose several challenges we need to address to enhance the efficiency and effectiveness of the processes involved. One of the significant hurdles is the collection and sorting of used products, which can be labor-intensive and require sophisticated sorting technologies to accurately separate materials. Additionally, the design of many electronic devices actually complicates disassembly, making it difficult to extract valuable components without damaging them.
Our collective goal should be to facilitate a shift to circular principles where disassembly is designed into our products. Embedding Eco-design principles in our businesses would help by prioritizing more sustainable designs, and better planning for extension of life and disassembly. There’s also the issue of economic viability; the cost of recycling processes can sometimes exceed the market value of the recovered materials, discouraging investment in recycling infrastructure.
Finally, recycling technologies themselves need to be further developed to efficiently recover a wider range of materials with high purity. Environmental concerns also arise, as recycling operations can generate hazardous waste if not properly managed. Overcoming these challenges demands innovation, regulatory support and global cooperation to develop more sustainable practices for managing critical materials throughout their lifecycle.
Dassault Systèmes’ perspective on critical materials
With great challenges come great opportunities – and the realm of critical materials is no different. Given the increased demand, there’s growing recognition of the need for policy intervention, more stable supply chains, more efficient production and a circular approach overall.
With a background steeped in science and the belief in the power of virtual worlds to improve real life, Dassault Systèmes solutions are well positioned to respond to the challenges inherent to the extraction, production, use and recycling of critical materials.
Through digitalization, manufacturers can increase efficiency across their operations. Virtual twins – scientifically accurate representations of a product or process – can help avoid unplanned infrastructure shutdowns, improve safety and even extend the lifecycle of assets.
A dirty secret of critical materials is they require more energy to produce than other commodities. These emissions will grow in proportion to the increase in demand. However, the use of virtual twins and simulation can fortify the overall climate advantages of clean energy tech compared to lifecycle emissions of the old guard.
Simulations and projections of projects have further found that there are huge opportunities for reducing emissions, from extraction through refining, smelting and beyond. For instance, using product and plant virtual twin simulation technologies can help facilitate more and better recovery of valuable parts and materials, resulting in better understanding and optimization of key critical materials flows.
While it may not be flawless, virtualization and virtual twins hold immense promise to drive us toward a more circular economy, illuminating our understanding of critical materials and empowering us to transform our world for the better.
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Patrick BallPatrick is a Senior Communications Manager on the Corporate Publishing team here at Dassault Systèmes. An experienced journalist, marketer, speechwriter and storyteller, Patrick's words have appeared on pages and stages around the world.