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Home / CARTEEH Researcher Perspectives / Lithium Mining for Electric Vehicle Batteries: Policies and the Distribution of Costs and Benefits across North and South Americas

Lithium Mining for Electric Vehicle Batteries: Policies and the Distribution of Costs and Benefits across North and South Americas

This is a new series in which we hear from CARTEEH-affiliated researchers on current topics of interest related to our research program.

By: Alice Grossman, Ph.D.

The original article in the Journal of Science Policy and Governance was co-authored by Matías Mastrángelo, Camilo De Los Ríos, and Mónica Jiménez-Córdova. You can find the full article for open-access download here.

In the United States, plug-in electric vehicle (EV) sales increased 68.1 percent year-over-year from May 2022 to May 2023 for light-duty vehicles.[1] Current national policies devote billions of dollars towards EV charging infrastructure and set requirements for vehicles and battery component sourcing.[2, 3] One such component is lithium for the lithium-ion batteries. The majority of the lithium needed to build these batteries is found in the Lithium Triangle located at the intersection of South American countries Chile, Argentina, and Bolivia, with over half of the lithium reserves present in Argentina and Chile.[4] While there is incentive to source more lithium from the U.S. for use in EV batteries, lithium mines take years to set up and produce lithium, and would take an environmental toll on ecologies in the U.S.[5] Already established and developing mines in the Lithium Triangle are thus an inevitable source of the material at least in the near-term.

Source: Inter-American Development Bank, 2022[6]
 

Costs and Benefits Across South and North Americas

Decision-makers and the media in the U.S. largely support the transition from internal combustion engine vehicles to EVs, hailing it as a means of creating a more environmentally sustainable future without tailpipe greenhouse gas emissions. However, when the entire supply chain for battery components is examined, the environmental costs associated with EVs start to emerge. The mining of lithium in the Lithium Triangle is negatively affecting natural resources and ecologies, creating challenges for nearby communities.

Our recently published article in the Journal of Science Policy & Governance (JSPG) discusses the imbalance of the environmental and associated social costs and benefits across North and South Americas of EV adoption and lithium mining. Table 1 from the article details this distribution showing more benefits for the economy, health, and the natural environment in North America, with more costs to health and the environment in South America, especially for indigenous communities in and near the Lithium Triangle geographic area.

Table 1. Distribution across South and North Americas of Social and Environmental Costs and Benefits of the Current Lithium Supply Chain for EV Applications
Source: Grossman et al., 2022[7]

The environmental costs associated with lithium mining are largely related to the large amounts of fresh water needed in the extraction process. For two MWh of Lithium-ion battery storage, a total of 33,155 regionally weighted cubic meters of water is needed across the entire supply chain, with highest contributions from Chilean lithium mining.[8]

The environmental degradation due to water loss imposes costs on the local populations in the Lithium Triangle. The competition for water in lithium mining areas and surrounding areas is so high that it may be threatening the livelihoods of nearby communities, including indigenous communities who are already marginalized.[9, 10]

However, there are opportunities for significant benefits to local populations in and around the Lithium Triangle. These benefits depend largely on the local management of the lithium industry through direct and indirect job creation and the redistribution of royalties and taxes. In Argentina, the lithium industry employs over 37 thousand people in the mining industry.[11] In the end, mining companies are the main benefactors through revenue, which includes firms that are North and South American-owned, but also with high levels of activity from Chinese firms.

Policies for Lithium Mining

There is a lack of international collaboration to develop policies for environmentally just mining of lithium, in part due to disparities between systems and goals in the U.S., Bolivia, Chile, and Argentina. The Initiative for Responsible Mining Assurance brings public- and private-sector stakeholders together to develop and use standards in mining, but it has not been largely adopted or incentivized at any point of the supply chain of lithium for EV batteries.

The three countries that make up the Lithium Triangle have very different legal structures as well as varied history and scientific development for lithium production. Moreover, their current lithium output is well below the potential of the estimated available resource of lithium in the area, especially in Bolivia, who does not yet have industrial-scale production of lithium compounds.[12] Lithium extraction in Bolivia is state-owned, and the Bolivian government has partnered with Chinese governments to expand lithium mining.[13]

Chile recently released a National Lithium Plan, which expands state-ownership over lithium mining, and may lead to more partnerships beyond the current mining activity dominated by Chilean- and U.S.- owned mining companies.[14] In Chile, the revenues generated by the lithium industry are among the largest of Chilean export commodities, yet the economic growth and redistribution of wealth has not reached many local communities.[15]

In Argentina, lithium activity falls within the regulatory framework that governs mining activity in general which allows for flexible opportunities for domestic or foreign mining companies, but largely comes down to a provincial policy issue. In the provinces of Salta and Catamarca, policies are mostly geared towards promoting the attraction of private investment.[16] The province of Jujuy, in contrast, works with the local and other public universities as well as the Argentinian National Scientific and Technical Research Council towards sustainable growth and socio-economic development.[17]

Impacts and Recommendations

In the Atacama Desert, from an environmental justice lens, mining and competition for water resources threatens the coexistence with indigenous populations.[18] Results from coupled natural and social models using data from several administrative sources and satellites used to study the interdependencies of lithium mining with environmental and social outcomes point to increased water scarcity, low levels of local content in their labor markets, and an increased in migration towards the mining region.[19] Agent based models formalized some of these effects and showed reduced groundwater supplies in the mining areas of the Atacama desert due to mining, and potential significant water loss in adjacent communities with possible social stress resulting from the water loss among local communities.[20]

In the U.S., projections estimate continued increase in demand for and adoption of EVs, and in turn a rise in demand for lithium for EV batteries.[21] The uneven distribution of more benefits in the U.S. from EV adoption, and more costs in the Lithium Triangle from lithium mining for EV batteries is thus likely to continue to grow. Stronger relationships and communication between Northern and Southern American decision-makers, scientists, and local communities who all understand the impacts of mining from different perspectives, may be able to help distribute the social and environmental costs and benefits of lithium extraction and electric vehicle sales and operations more equitably. Policies supporting common definitions, standards, and goals that could be applied to sustainable across borders, would allow the U.S. to better support global environmental justice goals throughout the supply chain for EVs.

Thank you to the research co-authors as well as the InterAmerican Institute for Global Change Research (IAI) for facilitating and supporting our collaboration.

References

  1. Argonne National Laboratory (2023). Light Duty Electric Drive Vehicles Monthly Sales Updates. 2023.
    https://www.anl.gov/esia/light-duty-electric-drive-vehicles-monthly-sales-updates
  2. United States PL 117-169, 2022
  3. United States PL 117-58, 2021
  4. Amato Alessia, Becci Alessandro, Villen-Guzman Maria, Vereda-Alonso Carlos, Beolchini Francesca, Challenges for sustainable lithium supply: A critical review, Journal of Cleaner Production, Volume 300, 2021, 126954, ISSN 0959-6526, https://doi.org/10.1016/j.jclepro.2021.126954
  5. Congressional Research Service (2022). “Critical Minerals in Electric Vehicle Batteries.” Washington D.C., August 2022. Accessed Jan 25, https://crsreports.congress.gov/product/pdf/R/ R47227#:~:text=These%20EV%20battery%20c hemistries%20depend,the%20Energy%20Act% 20of%202020.
  6. InterAmerican Development Bank (IDB) (2023). “Lithium: White Gold for a Region’s Development,” accessed April 18, 2023. https://www.iadb.org/en/improving
  7. Grossman, A., M. Mastrangelo, C. De Los Ríos, M. Jiménez-Córdova (2023). Environmental Justice Across the Lithium Supply Chain: A Role for Science Diplomacy in the Americas. PLOS Journal of Science Policy and Governance. June, 2023. https://doi.org/10.38126/JSPG220205
  8. Schomberg, A.C., Bringezu, S. & Flörke, M. Extended life cycle assessment reveals the spatially-explicit water scarcity footprint of a lithium-ion battery storage. Commun Earth Environ 2, 11 (2021). https://doi.org/10.1038/s43247-020-00080-9
  9. Romero, H., Méndez, M., & Smith, P. (2012). Mining development and environmental injustice in the Atacama Desert of Northern Chile. Environmental Justice, 5(2), 70-76
  10. Liu, W., D. B. Agusdinata, and S. W. Myint. 2019. “Spatiotemporal patterns of Lithium mining and environmental degradation in the Atacama Salt Flat, Chile.” International Journal of Applied Earth Observation and Geoinformation 80:145-156
  11. Ministerio de Economı́a Argentina. (2022). “Informe Mensual Empleo Minero en Argentina.”
  12. Jerez, B., I. Garcés, and R. Torres. 2021. “Lithium extractivism and water injustices in the Salar de Atacama, Chile: The colonial shadow of green electromobility.” Political Geography 87. https://doi.org/10.1016/j.polgeo.2021.102382.
  13. Graham, Thomas (2023). “Bolivia’s dream of a lithium future plays out on high-altitude salt flats”. The Guardian. January 25, 2023 https://www.theguardian.com/world/2023/jan/25/bolivia-lithium-mining-salt-flats
  14. Gobierno de Chile (2023). “Estrategia Nacion
  15. Comisión Chilena del Cobre. “Antecedentes para una polı́tica Pública en Minerales Estratégicos: Litio.” Pp. 18-19.
  16. Fornillo, B. (2015). “Del salar a la baterı́a”: Polı́tica, ciencia e industria del litio en la Argentina. In Colección Chico Mendes. Geopolı́tica del Litio: Industria, Ciencia y Energı́a en Argentina, edited by B. Fornillo, 57-90. Buenos Aires: El Colectivo.
  17. Gonzales, Lucas Isaac and Snyder, Richard (2020). Natural resources and policy choices in Latin America.
  18. Romero, H., Méndez, M., & Smith, P. (2012). Mining development and environmental injustice in the Atacama Desert of Northern Chile. Environmental Justice, 5(2), 70-76
  19. Liu, W. and D. B. Agusdinata. 2020. Interdependencies of Lithium mining and communities sustainability in Salar de Atacama, Chile. Journal of Cleaner Production 260:120838.
  20. Liu, W., D. B. Agusdinata, and S. W. Myint. 2019. “Spatiotemporal patterns of Lithium mining and environmental degradation in the Atacama Salt Flat, Chile.” International Journal of Applied Earth Observation and Geoinformation 80:145-156
  21. International Energy Agency (2022). Global EV Outlook. Paris: IEA.< https://www.iea.org/reports/global-ev-outlook2022>