The most obvious way to restore the balance between supply and demand — more mining — is tricky. Mining is environmentally destructive and damages ecosystems and communities. Plans for opening new mines in France, Serbia and Portugal have seen massive social opposition, leaving their future uncertain.
Opening a new mine can take more than 15 years on average, so projects started today might arrive too late. While some capacity can be built quicker by reopening old mines, and some projects are already underway, supply imbalances are expected to be inevitable by 2030.
Beyond mining, two alternative practical approaches exist. The first is to reduce the demand for critical minerals by clean energy technologies. With innovation and research and development, clean energy products can be redesigned to use less material in each generation.
The silver content in solar cells dropped by 80 per cent in one decade. Likewise, the cathodes in new electric vehicle batteries contain up to six times less cobalt than older models.
The second alternative is to increase the supply of critical minerals by recovering them from older and used clean technology products via advanced recycling. Decommissioned solar panels might no longer produce energy but can be a valuable source of silver or silicon.
Our past research has shown that discarded solar panels could outweigh new installations by the next decade as installers seek to replace older panels with newer, more efficient ones.
By recovering critical minerals from this waste in a process known as urban mining, we could cover the demand for the materials needed for future energy installations.
Recycling is the way forward
Our recent research with our colleague Luk Van Wassenhove compares the economic consequences of these two alternative approaches. If the scarcity of critical minerals is not extreme, reducing the critical material content of clean energy products would be the way to go.
However, unintended consequences can be expected akin to the rebound effect or Jevon’s paradox: by improving the efficiency of usage of critical minerals, producers can end up consuming more of it.
As clean energy products use less critical material, their improved profitability could increase production even more. As a result, decreasing the material usage per product won’t necessarily lead to a decrease in critical material demand overall.
In contrast, our research suggests that recycling decommissioned products is not subject to such a rebound effect. A steady stream of recycled materials from end-of-life products protects producers from volatile commodity prices and better facilitates the critical energy transition.
Setting up a recycling ecosystem requires greater effort than marginally changing a product’s design. Firms need a cost-efficient reverse logistics system, recycling plants and infrastructure to get enough end-of-use products back and to process them. Sizeable initial capital investments will take time to recover and require firms and policymakers to adopt a long-term mindset.
But there’s room for optimism. The start-up ROSI Solar opened its first recycling plant in 2023, making France a pioneer in recovering high-purity silicon, silver and copper from end-of-use solar panels.
Likewise, the U.S.-based SOLARCYCLE can recycle 95 per cent of valuable materials in solar panels. Many electric vehicle makers, like Tesla, Renault and Nissan, have started projects to recycle batteries and ensure a riskless cobalt, nickel and lithium supply. Recycling may indeed be the path to affordable clean energy.