Crisis in Copper Supply for Electric Vehicles

author: FutureCar Staff    

Moshiel Biton explores the implications of the "severe" shortage of copper in the context of the electrification revolution. Copper is a crucial mineral for powering the transition to a more sustainable, electrified society, being used in various applications such as home electronics and electric vehicle (EV) batteries.

However, the world is currently not sourcing enough copper to meet the increasing demand and achieve net-zero carbon targets. It is projected that by 2040, copper demand will rise by 53%, while supply will only increase by 16%.

EVs, which play a significant role in the electrification revolution, account for 55% of copper demand and require 2.5 times more copper than traditional internal combustion engine cars. The push for EVs, especially in the US, where emissions reduction is a priority, further emphasizes the importance of copper. Copper is also essential for storing energy from renewable sources like wind and solar.

The shortage of copper, coupled with its rising cost and limitations in battery production, poses challenges for EV manufacturers. Without an adequate supply of batteries, automakers cannot meet consumer demand for EVs. Additionally, the increasing cost of raw materials, particularly copper, forces manufacturers to either raise prices, potentially excluding some consumers, or reduce profit margins.

The severe copper shortage is expected to persist for decades. As EVs and renewable energy become more prevalent, other industries reliant on copper will also face difficulties in sourcing the metal. To effectively leverage the electric revolution, reduce emissions, and combat climate change, new mining initiatives must be implemented rapidly, although they can have negative environmental impacts.

To achieve net-zero targets, innovative solutions are needed to address the copper shortage. These solutions include exploring alternatives to copper, reducing copper consumption while improving efficiency, and adopting a sustainable circular economy approach to copper usage.

Investing in reliable sources and stable supply chains can help stabilize copper availability and mitigate disruptions in global markets. However, the severe shortage of copper is expected to persist for decades, necessitating the development of mining methods that maximize extraction while minimizing costs and environmental impact.

Efficient use of copper is crucial for EV manufacturers. This involves optimizing copper usage throughout the metal's life cycle, from extraction and production to end-user journey and recycling. Sustainable recycling and reuse of copper are vital, but the current collection and recycling rates are suboptimal. Scaling up recycling methods and investing in research and projects for battery and consumer product recycling are essential steps.

Recent advancements in battery technology offer promising opportunities to improve copper efficiency and alternative battery production methods. Batteries that maximize copper use can provide more energy at a lower cost and with reduced overall copper consumption. However, further research and development are necessary.

The Biden administration has taken steps to support technological breakthroughs in EV battery technologies and enhance recycling capacities through an advanced battery research consortium. The administration has also invoked the Defense Production Act to address the production of critical minerals, including copper.

Transitioning to EVs can significantly reduce greenhouse gas emissions and lower costs for producers and consumers. However, as copper becomes scarcer and more expensive, automakers and environmental agencies face challenges. Addressing this scarcity requires collaboration between innovative companies, government subsidies, private investments, and international cooperation.

Innovation and collective action are essential to drive towards a sustainable, electrified, and decarbonized economy. It is crucial to act swiftly to address the copper shortage before it becomes an insurmountable obstacle.

About the author: Moshiel Biton is the CEO and Co-Founder of Addionics.

FutureCar Staff