As nations rally for a clean energy transition, experts predict that Africa, South America and Central Asia are positioned to emerge as the primary beneficiaries of their significant and critical mineral reserves.
The clean energy transition will create “winners and losers,” according to Gracelin Baskaran, the research director and a senior fellow for the Energy Security and Climate Change Program at the Center for Strategic and International Studies (CSIS).
Baskaran told Anadolu that Africa, South America and Central Asia stand to gain the most from the clean energy transition. She explained that these countries “have significant reserves of many of the critical minerals the US and its allies lack. For example, over 70% of the world’s chrome, manganese and platinum is in Africa, and you need all three for the energy transition.”
She argued that countries with big coal reserves will be on the losing end, but countries with rich reserves of critical minerals—many of which are low- and middle-income—stand to gain.
According to the latest report by energy research firm Wood Mackenzie, the creation of a mineral “Super Region” comprising Africa, the Middle East, Central Asia and South Asia could significantly bolster the energy transition.
Wood Mackenzie predicts that around $400 billion in capital expenditure is required for mining, refining, and smelting of critical minerals by 2030 to bridge the supply-demand gap and limit global temperature increases to 1.5°C above pre-industrial levels.
Baskaran notes that the clean energy transition is 'bringing countries that have long operated on the periphery of the global economy to center stage. Western countries are scrambling to do business with them rather than just dish out aid.”
Sam Butler-Sloss, an expert at the Rocky Mountain Institute (RMI), a US-based non-profit organization on clean energy, said, 'The growth of renewables is a technological revolution that will profoundly change the cost and geopolitics of energy.”
'As history shows, technological leadership paves the way to geopolitical power,' Butler-Sloss added. “What lies at the heart of the energy transition is a shift from an expensive, inefficient, volatile, scarce, commodity-based fossil system to cheaper, cleaner, leaner technologies that offer continuously falling costs and are available everywhere.”
-China leads 'renewable revolution'
According to Butler-Sloss, China leads the 'renewable revolution' as the country manufactures about three-quarters of the world's clean energy technologies. China “is electrifying road transport and industry faster than any other major nation and has the most installed solar and wind in the world.”
In 2023, China installed more solar and sold more electric vehicles than the US has in the last 20 years, he added.
Echoing Butler-Sloss, Baskaran said China is a dominant producer of both graphite and rare earths. She cited a December 2023 China ban on rare earth mineral export technologies and said this measure increased the criticality of these resources.
In response to the question of the rising importance of materials such as lithium, copper, and nickel, Baskaran said: “The important thing to consider when thinking about critical minerals is that ‘criticality’ is dynamic. For example, three years ago, the US was very worried about lithium supply. Then, late last year, the US discovered one of the world’s largest lithium deposits along the Nevada-Oregon border. Lithium is now less critical because there’s a lower risk of supply disruption.”
According to Baskaran, rare earths are not actually rare but rather difficult and very expensive to separate from the ore.
Commenting on Türkiye's discovery of the world's second-largest rare earth element reserve in the central Turkish province of Eskisehir, Baskaran said that as Türkiye does not have rare earth separation facilities, they would likely be sent to China for separation, making Türkiye reliant on a processing partner.
She suggested that Türkiye leverage its rare earths to build an alliance with a country seeking to source rare earths in exchange for investments in energy generation and transmission.
Butler-Sloss said while mining key transition minerals offers significant opportunities, greater benefits will accrue to those who ascend the value chain into refining and manufacturing.
“Türkiye is strategically positioned to advance up the renewable value chain,” he said.
“By rapidly replacing costly fossil fuel imports with cheaper, securer, domestically produced renewables, Türkiye can strengthen its position in capturing a larger share of the renewable prize,” he added.
According to Butler-Sloss, as history has seen, industry will gravitate to where energy is the cheapest and in the age of renewables, this will be to electrostates that lead the deployment of low-cost solar and wind.
By Handan Kazanci
Anadolu Agency
energy@aa.com.tr