Rare-Earth Minerals Surface as a Significant U.S. Policy Concern


As the United States seeks to catch up with the rest of the world in developing cleaner energy sources, including solar photovoltaic energy, “rare-earth” minerals are becoming a focus of increased attention.


Rare-earth minerals are used in manufacturing plug-in vehicles, wind turbines, thin-film solar photovoltaic modules, energy-efficient lighting and other energy-related products.


While not rare, these minerals are not especially common, and are known to exist, like petroleum, in a limited number of geographic areas. Experts say they are particularly difficult to mine in profitable quantities. According to the U.S. Department of Energy, China has 37 percent of the world’s known reserves of rare-earth minerals, the United States has about 13 percent, and Canada and Australia also have significant reserves.


However, China, where the minerals can be mined most economically, provides about 95 percent of the world’s current supply. Because China is rapidly developing a clean-energy economy, it has begun paying close attention to the domestic availability of rare-earth minerals, which were mentioned in connection with a recent dispute between China and Japan.



The world is
on the cusp
of a clean-energy
revolution.
Other countries
are seizing
this opportunity,
and the market
for clean-energy
technologies
is growing
rapidly
all over
the world.


David Sandalow
Assistant Secretary of Energy
for Policy and International Affairs


Japan plans to become a major producer of battery-powered vehicles, as well as thin-film solar equipment.


Despite its shifting political currents, the United States, especially California, has been moving toward the development of a clean-energy economy that includes wind and solar energy and plug-in vehicles.


“America’s future prosperity may well depend on our ability to lead in the global transition to a clean-energy future,” said Jonathan Silver, executive director of the U.S. Department of Energy’s Loan Programs Office, in recent congressional testimony. “Yet, according to a report by the Pew Charitable Trusts, while the U.S. had the world’s highest GDP in 2009, we ranked 11th in clean-energy investment as a percentage of GDP. Allowing this gap to continue to grow will have serious implications not only for our global competitiveness, but also for our national security and the environment.”


Rare-earth minerals, because of their importance in clean-energy development, were a recent topic of testimony before a Senate subcommittee by David Sandalow, U.S. assistant secretary of energy for policy and international affairs. Before answering questions, Mr. Sandalow delivered a prepared statement titled “Examining the Role of Strategic Minerals in Clean Energy Technologies and Other Applications.”


Mr. Sandalow mentioned that lanthanum is used in batteries for hybrid cars, neodymium is used in magnets for electric generators found in wind turbines, and europium is used in colored phosphors for energy-efficient lighting. In addition, tellurium and indium are used in making thin-film photovoltaic modules. (Other solar modules are made with crystalline silicon and are generally more efficient and more expensive than thin-film equipment).


“It goes without saying that diversified sources of supply are important for any valuable material,” Mr. Sandalow told senators. “Development of substitute materials and policies for re-use, recycling and more efficient use are also important. If rare-earth metals are going to play an increasing role in a clean-energy economy, we need to pursue such strategies.”


“This transition to a clean-energy economy is already well under way,” the assistant secretary added. “The world is on the cusp of a clean-energy revolution. Other countries are seizing this opportunity, and the market for clean-energy technologies is growing rapidly all over the world.


“Today, the Chinese government is launching programs to deploy electric cars in over 20 major cities. They are connecting urban centers with high-speed rail and building huge wind farms, ultra-supercritical advanced coal plants and ultra-high-voltage long-distance transmission lines.


“India has launched an ambitious National Solar Mission, with the goal of reaching 20 gigawatts of installed solar capacity by 2020.


“In Europe, strong public policies are driving sustained investments in clean energy. Denmark is the world’s leading producer of wind turbines, earning more than $4 billion each year in that industry. Germany and Spain are the world’s top installers of solar photovoltaic panels, accounting for nearly three-quarters of a global market worth $37 billion last year. Around the world, investments in clean-energy technologies are growing, helping create jobs, promote economic growth and fight climate change. These technologies will be a key part of the transition to a clean-energy future and a pillar of global economic growth.”


To remain competitive, he said, the United States must take several steps.


“First, we must globalize supply chains for these [rare-earth] materials. To manage supply risk, we need multiple, distributed sources of clean-energy materials in the years ahead. This means taking steps to facilitate extraction, refining and manufacturing here in the United States, as well as encouraging our trading partners to expedite the environmentally sound creation of alternative supplies,” Mr. Sandalow said.


“Second, we must develop substitutes for these materials. Doing so will improve our flexibility as we address the materials demands of the clean-energy economy. In order to meet this objective, we will need to invest in R&D to develop transformational magnet, battery electrodes and other technologies that reduce our dependence on rare earths.” The Department of Energy is conducting research along these tracks, he added.


“Third, we must explore opportunities to promote recycling, re-use and more efficient use of strategic materials in order to gain more economic value out of each ton of ore extracted and refined. Widespread recycling and re-use could significantly lower world demand for newly extracted rare earths and other materials of interest. For example, we could develop a process to recycle terbium and europium in the phosphors of compact and conventional fluorescent light bulbs. Neodymium could be recycled from hybrid and electric vehicles. Additionally, recycling and re-use could reduce the life-cycle environmental footprint of these materials, another critical priority.”


Mr. Sandalow told senators that “there’s no reason to panic, but every reason to be smart and serious as we plan for growing global demand for products that contain rare-earth metals. Recent events underscore this. The United States intends to be a world leader in clean-energy technologies. Toward that end, we are shaping the policies and approaches to help prevent disruptions in supply of the materials needed for those technologies. This will involve careful and collaborative policy development. We will rely on the creative genius and entrepreneurial ingenuity of the business community to meet an emerging market demand in a competitive fashion. With focused attention, working together, we can meet these challenges.”

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