Solar panels, electric cars and U.S. mining companies

This story originally appeared in WhoWhatWhy and is being republished here as part of Covering Climate Now, a global journalistic collaboration to strengthen the coverage of climate history.

President Joe Biden’s ambitious proposal to spend hundreds of billions of dollars on the transition to renewable energy and electric vehicles could help stave off climate change. But paradoxically, they also pose a huge profit opportunity for U.S. mining companies, even at the expense of the environment and taxpayers.

Mining companies are already using the green energy movement as an excuse to keep extracting rare earth minerals on public land for almost nothing under a 19th-century law that in a turn also allows for potentially catastrophic pollution and other degradation.

Building solar panels, lithium-ion batteries and wind turbines requires precious minerals such as zinc, copper and cobalt as well as lithium. Partly thanks to publicly subsidized proposals such as the Biden administration’s push to shift 40 percent of U.S. energy production to solar in 2035 – up from 4 percent today – some mining companies have renamed and repositioned themselves, not entirely cynically, as green energy companies.

Other promises from the Biden administration, such as moving half of U.S. car production to electric vehicles by 2030, will require large new sources of rare earth minerals. Although much of the US demand for precious metals is supplied by sources in foreign countries, including China, there are potential domestic sources, such as Lithium Americas’ proposed Thacker Pass lithium mine in Nevada. But Thacker Pass, the largest lithium deposit in the United States, is on federal land, as are almost all other domestic sources of these minerals.

Enter Congress, which debates proposed amendments to the General Mining Act of 1872 that could force the industry to clean up its act and cut profits from mining companies, which in turn respond by using what critics say is a cynical mix of xenophobia. and classic big-business threats to quit mining domestically and relocate abroad.

Adopted under the administration of Ulysses S. Grant, considered one of the most corrupt in American history, the current law allows private interests to extract 350 million acres of publicly owned land in the western United States without paying royalties. such as. the fees for oil and gas extraction equipment.

The current lack of royalty for hard rock minerals extracted from our public lands is a taxpayer award to the mining industry.

Anyone who discovers a vein of precious minerals and then begins to mine can do so “without paying a dime for them,” say critics like the environmental lawyer group Earthworks. That’s not entirely true, but it’s close: Land can be acquired for as little as $ 5 acres, as Autumn Hanna, vice president of Taxpayers for Common Sense, told a recent Senate hearing.

The General Mining Act also means that mining companies can “get in, dig up riches from the ground and leave clutter”, including an estimated daily flow of 50 million gallons of contaminated water from “hundreds of thousands of abandoned mines”, which will cost an estimated $ 50 billion to clean, according to recent estimates.

“The current lack of royalty for hard rock minerals extracted from our public lands is a taxpayer award to the mining industry,” said Jenny Rowland-Shea, deputy director of public lands at the left-wing Center for American Progress. “Over the years, mining companies – many of which are foreign-owned to begin with – have robbed taxpayers and the federal treasury of billions of dollars.”

In a rare show of unity, congressional Democrats – including the mercurial West Virginia Senator Joe Manchin, whose opposition may reject some of Biden’s most sweeping green energy proposals – are pushing for what are described as the first major updates to the General Mining Act as part of the radical reforms that the Democrats include in the so-called “budget vote proposal”.

During that process, lawmakers could skip mysterious Senate rules that require a 60-vote majority – almost impossible to achieve in a hyperpartisan atmosphere – and instead pass legislation by a simple majority tucked away in an expense bill.

In September, the House Natural Resources Committee proposed charging mining companies 8 percent royalty on existing mines, 4 percent royalty on new mining and a 7-cent fee for every tonne of hard rock removed.

The proposal has the support of Democrats, including Manchin, who chairs the Senate Committee on Energy and Natural Resources.

“It makes no sense at all to put our lithium-ion battery supply chain in the hands of foreign players like China when we have lithium here, which can provide a reliable source of domestic production,” Manchin said during a hearing on October 5.

Allowing mining companies to make billions a year on extracting on federal land “without a penny of royalties is just crazy,” he added.

Updates to the General Mining Act are also a point of rare bipartisan voter support. In her testimony on October 5, Hanna told taxpayers of common sense that a poll conducted by the organization found more than two-thirds support among all voters.

But mining companies, as well as Republicans like Wyoming Senator John Barrasso, the ranking GOP member of the committee, say the new charges will simply make mining companies abandon U.S. sources of lithium and other minerals and shift attention abroad.

“Instead of raising revenue and protecting land, this approach will lead to premature closure of existing mines and minimal interest in future US mines, resulting in an unhealthy increased dependence on foreign sources of minerals from countries with far less stringent environmental and labor standards, a loss of high-paying family-paid jobs, and severe financial hardship for mining-dependent rural areas, “said Katie Sweeney, executive vice president of the National Mining Association, in a statement before the committee. However, mining companies are open to “reasonable” fees, Sweeney said.

Environmentalists warn that the movement for renewable energy creates a kind of paradox. Scientific models point out that it is the only way to avoid catastrophic scenarios for climate change if combustion engines and energy from fossil fuels are dropped. But allowing mining companies to extract the raw materials needed to build a green energy infrastructure without regulation poses deadly threats to water quality and biodiversity, recent studies have shown.

Some environmental advocacy groups, such as Trout Unlimited, have suggested other techniques for obtaining important green economy minerals, including recycling old components or recycling minerals from old mines or old mining waste. While perhaps logically and technically feasible, these techniques seem unlikely to satisfy mining companies and their shareholders, for whom new mines – operated under the same well-known 19th-century regulation – are simply more profitable.


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