Inventory of critical minerals

The clean energy transition gathering momentum is crucial for achieving the climate goal of limiting global warming to 1.5 degrees Celsius from pre-industrial levels.
Inventory of critical minerals

 The clean energy transition gathering momentum is crucial for achieving the climate goal of limiting global warming to 1.5 degrees Celsius from pre-industrial levels. Critical minerals such as copper, lithium, nickel, cobalt, and rare earth elements being essential components in clean energy transitions, countries undertaking assessments of their reserves and measures to extract and utilise these minerals play a vital role in meeting the Net Zero emission target. The publication of the list of critical minerals by the Ministry of Mines will help industrial sectors like high-tech electronics, telecommunications, transport, and defence draw a more comprehensive and realistic roadmap for the country’s clean energy transition and also anchor it to the global roadmap. The Paris Agreement, which is legally binding on all consenting countries, lays down the ground rule that carbon emissions must peak by 2025 and then decline to 43% by 2030 to limit global warming to 1.5. The window of carbon emission peaking is closing very fast, and clean energy transition is the challenge India needs to overcome in order to stay on course of cutting down carbon emissions in accordance with its National Determined Contributions to the United Nations Framework Convention on Climate Change for reaching net zero by 2070. According to the International Energy Association, lithium, nickel, cobalt, manganese, and graphite are crucial to battery performance, while rare earth elements are essential for permanent magnets that are used in wind turbines and electric vehicle motors. The IEA estimates that mineral demand for clean energy technologies is set to quadruple by 2050 in both the announced pledges and Net Zero scenarios, with annual revenues reaching US$400 billion. It cautions that high and volatile critical mineral prices and highly concentrated supply chains could delay energy transitions or make them more costly. The global agency, which provides data and analysis to the countries and also makes recommendations to enable them to articulate energy policy goals and agendas, projects that demand for each of the five key critical minerals is set to increase 1.5 to 7 times by 2030 as clean technology deployment increases. “The capacity additions required are feasible, but investment would need to flow into new projects within the next 3 years to bring them up to speed with the net zero trajectory,” it says. It also estimates that around 360 to 450 billion dollars of investment would be needed cumulatively over 2022–2030 in critical mineral mining to reach the projected level of production. In this backdrop, India’s own inventory of critical minerals bears great significance for the country’s NDC goals. Information furnished by the Ministry of Heavy Industries to the Estimates Committee of the parliament, when enquired about the reason for the high upfront cost of EVs compared to internal Combustion Engine (ICE) vehicles, indicated that Lithium-ion batteries are the most expensive component in EVs, accounting for about 30 to 40% of the cost of the vehicle. India imports Lithium-Ion cells for manufacturing/assembly of battery pack domestically which explains the high cost. The parliamentary committee’s report on the evaluation of Electric Vehicle Policy highlights that EV sales in the country account for only 2 to 3% of total auto sales, despite incentives and subsidies offered by the central and state governments. The hard reality is that India is the fifth-largest automobile market in the world, and vehicular pollution has been rising alarmingly in most cities and towns. The report points out that even though the upfront cost of an EV is high, the operational cost is much lower than that of a conventional ICE vehicle that runs on fossil fuels. The viable option to reduce the upfront cost of EV is domestic production of lithium and lithium-ion cells to reduce import dependency. The Geological Survey of India establishing, for the first time, Lithium inferred resources of 5.9 million metric tonnes in the Salal-Haimana area of the Reasi District of Jammu and Kashmir triggered hopes of domestic lithium production and li-ion batteries. The GSI is taking up 966 programmes comprising 318 mineral exploration projects, including 12 marine mineral investigation projects for the current year, with a major focus on 115 projects for the exploration of strategic, critical, and fertiliser minerals. The IEA’s report, “The Role of Critical Minerals in Clean Energy Transitions,” presents the challenges in respect of critical mineral production. One of the key challenges is that it takes, on average, more than 16 and a half years from discovery to production. This makes realising the dream of self-reliance in critical mineral exploration, processing, and achieving circular economy goals a challenging task, but India’s overcoming it in respect of 30 identified critical minerals will be of paramount importance to achieving the larger goal of building an Atmanirbhar Bharat. Once the energy transition is accomplished, an undisrupted supply chain of these critical minerals will be critical for clean energy security. Addressing associated environmental issues in the mining of these minerals also needs to be prioritised.

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