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- US lithium production is expected to rise as new projects are planned in Nevada and California.
- The expansion aims to reduce dependence on China for critical minerals and electric vehicle batteries.
- Some environmental groups and indigenous tribes say the mines threaten wildlife and sacred sites.
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The US is on the cusp of a lithium boom after years of laying the groundwork for an electric vehicle supply chain that isn’t dependent on China.
This past month, the Biden administration approved Nevada’s Rhyolite Ridge lithium boron mine and loaned $2.6 billion to the company developing Thacker Pass, another lithium mine in the state. A project in California’s Salton Sea began construction earlier this year. The three sites, expected to come online between 2026 and 2028, would greatly increase lithium supply in the US. Since the 1960s, only one location, Silver Peak, in Nevada, had operated in the country.
The expansion is aimed at curbing Chinese control over the metals used in EV batteries and other renewable energy technologies that countries need to decarbonize their economies. While most of the world’s lithium is produced in Australia and South America, about two-thirds of it is processed in China, which also dominates EV battery production. The US imports about 25% of its lithium supply from Chile and Argentina, but an analysis of federal data by the Atlantic Council shows it will rely on China for about 70% of its lithium-ion batteries by 2023.
“As we electrify the transportation sector, you don’t want to be dependent on one country,” Bernard Rowe, director of Ioneer, which is developing Rhyolite Ridge, told Business Insider. “There was a recognition that there had to be domestic production.”
A customs officer inspects imported lithium carbonate at the Shanghai International Port on June 6, 2022.
VCG/Getty Images
The Biden administration is encouraging U.S. mining and manufacturing through a mix of loans, grants, tax breaks and research and development programs — much of which was authorized under the Inflation Reduction Act. The incentives cover activities such as the extraction of crucial minerals such as lithium; production of solar, wind and battery components; buying electric vehicles; and recycling components.
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Rowe argued that while the U.S. alone cannot meet skyrocketing demand for lithium due to rising sales of electric vehicles and battery storage, some of the supply should be sourced domestically for national security reasons.
Karl Friedhoff, a fellow for Asian studies at the Chicago Council on Global Affairs, agreed. He said there is no world in which the US and its partners can quickly compete with China in crucial minerals; China already has so much capacity that it sets global prices.
“The question then is: can the US and other partner countries create a supply chain that meets their basic needs,” said Friedhoff, who is part of a project exploring how the US, Japan, Australia and India can work together to shift supply chains away from China . “Can we supply our own batteries? Can we build our own battery technologies? Do we have enough rare earths for defense?”
Based on estimates from Ioneer and other lithium project developers, the U.S. could produce more than enough supply for the 1.4 million electric vehicles sold in the country last year, which accounted for 7% of the auto market.
The Biden administration wants electric vehicles to account for at least 50% of auto sales by 2030, and states like California and Texas are quickly deploying more battery storage to balance stressed power grids. In September, the White House said U.S. lithium production is on track to meet a fifth of global demand outside China this decade.
Some environmentalists and indigenous tribes are alarmed
However, the lithium projects have not been without controversy. The Center for Biological Diversity has threatened to sue the Biden administration over the Rhyolite Ridge permit, arguing the project could drive an endangered wildflower to extinction. The Western Shoshone Defense Project, which protects the homelands of the Western Shoshone people, says the mine threatens local water sources and culturally significant sites.
A Tiehm’s buckwheat factory in Esmeralda County, Nevada, is growing next to the site where the Rhyolite Ridge lithium boron mine is planned.
Robyn Beck / AFP
Thacker Pass faced similar opposition, but a federal judge last year dismissed a lawsuit from three native tribes that claimed construction of the mine near a sacred site along Nevada’s border with Oregon violated the law. the AP reported.
Rowe said Ioneer redesigned the Rhyolite Ridge mine to limit its footprint in the critical habitat of the endangered wildflower, Tiehm’s buckwheat. He said Ioneer would also monitor the pollinator population and implement dust control strategies. The Biden administration said in issuing the permit for the mine that it would not jeopardize the flower’s survival.
Some companies are working on it direct lithium extraction techniques which do not involve surface mining or large evaporation ponds and therefore require less land and water and produce less toxic chemical waste. Controlled Thermal Resources is developing such a project in the Salton Sea, where lithium-rich brine is already used to power geothermal plants.
Tapping the newly discovered lithium resources in the US will likely depend on new extraction techniques, which currently cost more than traditional methods and are still not in commercial use. The US Geological Survey estimated this month that there is enough lithium beneath southwestern Arkansas to meet nine times the projected global demand for car batteries by 2030.
Actually extracting that lithium, including from brines left over from oil and gas production in the region, depends on whether the direct extraction techniques are feasible, USGS researchers said.
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