REM: Demand soaring, market responding for critical minerals – IEA

Record deployment of clean energy technologies such as solar PV and batteries is propelling unprecedented growth in critical minerals markets, according to a new report by the International Energy Agency (IEA).

The market for critical minerals that help power electric vehicles (EVs), wind turbines, solar panels and other technologies key to the clean energy transition has doubled in size over the past five years, says the report.

The first annual IEA Critical Minerals Market Review shows that the energy transition is unlocking huge demand for minerals such as lithium, cobalt, nickel and copper.

From 2017 to 2022, the energy sector was the main factor behind a tripling in overall demand for lithium, a 70% jump in demand for cobalt, and a 40% rise in demand for nickel.

The market for energy transition minerals reached $320bn in 2022 and is set for continued rapid growth, moving it increasingly to centre stage for the global mining industry. The 2022 level was broadly similar to the market size for iron ore mining.

The market is responding. Investment in critical mineral development rose 30% last year, following a 20% increase in 2021. Among the different minerals, lithium saw the sharpest increase in investment, a jump of 50%, followed by copper and nickel. The strong growth in spending by companies on developing mineral supplies supports the affordability and speed of clean energy transitions, which will be heavily influenced by the availability of critical minerals, said IEA.

In 2022, the share of clean energy applications in total demand reached 56% for lithium, 40% for cobalt and 16% for nickel, up from 30%, 17% and 6% respectively five years ago.