Canada’s mining sector is facing heightened expectations to scale up to meet clean energy’s spiking demand for critical minerals, just as a recent report says a “battery mineral loop” can curb the need for more mining after an initial one-off buildout to get the system established.
Annual demand for critical minerals could reach a value of $770 billion by 2040 in a world that meets its climate pledges, the Canadian Climate Institute’s 440 Megatonnes initiative states in a recent post. But various analyses show how that demand, and the resulting environmental and human impacts, can be reined in with a more circular approach to mineral use and reuse.
Much of the demand for critical minerals will be driven by the transition to a clean economy, especially the shift to electric vehicles, 440 Megatonnes states. “Canada has the mineral reserves to compete here, and how it approaches this opportunity will shape the success of its clean energy transition.”
For the country to successfully pull off its own domestic transition, it will need to secure $16 billion worth of critical minerals per year by 2040, double the dollar value it produced in 2022. By 2040, after factoring in export markets, the country “could produce anywhere from $4 billion to $43 billion worth annually, depending on investment decisions today.”
Scaling up to meet that target will depend on attracting significant new investment: to reach a $16-billion annual production threshold, 440 Megatonnes says, Canada will need $30 billion in new capital “as soon as possible.”
But to get those dollars flowing, mining companies will have to improve their performance on environmental protection and human rights—especially in a country like Canada, where critics say the sector has historically neglected those values. Mining companies missed a chance to begin walking back their record when not one of them endorsed the current call for Canada to adopt sustainability disclosure standards that are already in place around the world, even though:
• 600 Indigenous communities are already located within 100 kilometres of major mineral projects;
• 25% are within 25 kilometres of federally recognized Indigenous territories;
• 34% of active priority critical mineral projects are within 25 kilometres of protected and conserved areas.
“The rush for critical minerals, while cloaked in imaginings of a sustainable and prosperous future, remains firmly rooted in historical settler-colonial and extractivist dynamics,” write Thierry Rodon, a professor in the political science department at Université Laval, and Sophie Thériault, a law professor at the University of Ottawa, in Policy Options.
One way to address the harmful impacts of critical mineral extraction is to scale back reliance on primary materials by investing in battery recycling and improving technology efficiencies. The 440 Megatonnes analysis includes a scenario where recycling cuts domestic demand by 25%, to $12 billion per year, compared to a pathway with no recycling.
A new report from Colorado-based clean energy think tank RMI points to a far greater opportunity. It says a series of six solutions—developing battery chemistries that require fewer critical minerals, increasing battery energy density, recycling batteries, reusing batteries, building vehicles more efficiently, and improving the efficiency of mobility—can create a circular “battery mineral loop” that supplies critical minerals without new mining by 2050.
Many of these solutions are already being pursued, RMI writes. New technology advancements are leading toward new, more efficient batteries. Battery recycling, though still a nascent industry, has been establishing itself in the economy.
If its recommendations are followed, RMI maintains that after taking into account the critical minerals already extracted, only a cumulative 125 million tons of new battery minerals will have to be mined to support circular battery self-sufficiency. At that level, the mining required to propel the clean energy transition would be 17 times smaller than the amount of oil extracted and processed for road transport every year, making the environmental and social footprint of critical mineral mining significantly smaller by comparison.
“If we take circularity seriously, we can bring mining to a [limited time] one-off that will happen over the next 20 years, before we hit net-zero mineral demand by 2050. That means we can hit net-zero emissions in transport and net-zero mineral mining before 2050,” RMI senior associate Will Atkinson told a recent webinar.
“So that’s really big.”
