The Controversial Race for Cobalt

EV sales are booming with no signs of slowing. This shift to EVs has been celebrated by advocates for reducing carbon emissions caused by internal combustion engines. As sales accelerate, however, there is growing concern over sourcing of finite minerals (lithium, nickel, cobalt) commonly used in EV batteries.

Cobalt, especially, has drawn attention as a result of controversial mining methods in the Democratic Republic of Congo (DRC), which holds more than 60% of the world’s known cobalt supplies. Concerns over environmental and humanitarian practices have pushed battery manufacturers to look for alternative battery chemistries that use sustainable methods and less controversial minerals. Still, developing viable battery technologies takes time and money. EV production is rapidly overtaking the rate at which minerals can be sourced, and big players are scrambling to secure a supply line of finite sources.

Big Players Seek Sustainable Solutions

In 2018, Tesla announced it would reduce the cobalt content of its nickel-cobalt-aluminum batteries for its EVs, with an ambitious goal of 0% cobalt content. The Model 3 contains 2.8% cobalt, and there were assurances in 2019 that the percentage of cobalt would soon drop even lower. At the same time, Tesla has developed a utility-scale megapack that requires a large amount of cobalt to operate. Additionally, in January, it was reported that Tesla was in talks to secure a large cobalt supply from Glencore, which sources from a Canadian subsidiary that operates in the DRC. Glencore has also signed contracts with battery manufacturers Samsung SDI and SK Innovation. Tesla released a Conflict Minerals Report that addresses issues of responsible mineral sourcing, citing efforts to reduce cobalt in its batteries and closely monitor its cobalt supply chain. In 2018, BMW, BASF, and Samsung launched a pilot project to support sustainable mining practices in the DRC.

The Challenge of Regulating Unpredictable Variables

Those close to the EV battery industry have warned of impending mineral shortages due to the rapidly increasing demand for EVs and large batteries for storage. For many manufacturers, securing a raw mineral supply is of growing importance. Still, battery makers cannot ignore the mounting evidence of irresponsible practices from cobalt suppliers that engage in child labor and loosely regulated safety precautions. In June 2019, a Glencore copper mine collapse resulted in the death of 36 miners who are believed to have been working at the mine illegally. Artisanal mining occurs frequently and without regulation yet attracts many locals who seek work and are willing to take the risk.

Although mounting pressure from environmental and humanitarian advocates pushes companies to ensure sustainable practices from their supply chains, the fear of dwindling materials for batteries is resulting in a race to secure finite minerals. Will the plan to phase out cobalt become a reality in time to conserve finite resources and alleviate controversial working conditions, or will a scramble by large battery manufacturers to lock down minerals only exacerbate the issues at hand?