American Copper: A Key Metal for the Energy Transition
Copper is one of the most important metals for the modern world, as it is used in a variety of applications, from building construction and transportation equipment to electrical and electronic products and consumer goods. Copper is also a critical element for the energy transition, as it is essential for advanced technologies such as electric vehicles, wind turbines, solar panels and power grids.
According to Goldman Sachs, copper demand will increase nearly 600 percent by 2030 due to the growing needs of the energy transition. However, the United States is currently dependent on imports for more than a third of its copper consumption, as the domestic mining industry faces long and complex permitting processes that hinder its ability to access the abundant copper reserves in the country.
This article will highlight some of the benefits of copper for the energy transition, as well as some of the challenges and opportunities for increasing domestic copper production in the United States.
Benefits of Copper for the Energy Transition
Copper is widely used in the energy sector because it has excellent electrical and thermal conductivity, high corrosion resistance, durability and recyclability. Copper is also antimicrobial, which makes it suitable for medical products and public health applications.
Some of the main uses of copper for the energy transition are:
- Electric vehicles: Electric vehicles (EVs) require four times more copper than gas-powered vehicles, as copper is used in the electric motors, batteries, wiring and charging infrastructure. A single EV can contain up to 180 pounds of copper, while a hybrid vehicle can use up to 85 pounds. The International Energy Agency (IEA) projects that EVs will account for 30 percent of global car sales by 2030, which will increase copper demand by 1.7 million tons per year.
- Wind turbines: Wind turbines use copper in the generators, transformers, cables and control systems. A single wind turbine can require up to 9,400 pounds of copper, depending on its size and capacity. The IEA expects wind power to grow by 60 percent by 2024, which will increase copper demand by 450,000 tons per year.
- Solar panels: Solar panels use copper in the photovoltaic cells, inverters, wiring and mounting systems. A typical solar panel can contain up to 5 pounds of copper, while a large-scale solar farm can use up to 11 tons per megawatt. The IEA predicts that solar power will grow by 70 percent by 2024, which will increase copper demand by 350,000 tons per year.
- Power grids: Power grids use copper in the transmission and distribution lines, substations and smart grid technologies. Copper is essential for ensuring efficient and reliable delivery of electricity from renewable sources to consumers. The IEA estimates that power grids will need to invest $13.5 trillion by 2040 to meet the growing demand for electricity and support the energy transition, which will increase copper demand by 3.1 million tons per year.
Challenges and Opportunities for Domestic Copper Production
The United States has vast copper resources that could support its domestic needs and reduce its reliance on imports. According to the U.S. Geological Survey (USGS), the United States has 51 million tons of identified copper reserves and 290 million tons of undiscovered resources. However, only about 20 percent of these resources are currently accessible for mining due to regulatory and environmental constraints.
The main challenge for domestic copper production is the lengthy and complex permitting process that can take up to 10 years or more to complete. This process involves multiple federal, state and local agencies, as well as public consultations and environmental reviews. The process also faces uncertainties and delays due to legal challenges and political changes. These factors discourage investment and innovation in the domestic mining industry and make it less competitive than other countries with more streamlined permitting systems.
The main opportunity for domestic copper production is to reform the permitting process and make it more efficient and predictable without compromising environmental standards or public participation. This could be achieved by establishing clear timelines and milestones for each stage of the process, coordinating among different agencies and stakeholders, reducing duplication and overlap of requirements, enhancing transparency and accountability, and providing incentives for best practices and innovation.
Some examples of domestic copper projects that could benefit from