The Role of Critical Minerals for a Sustainable Future

As the global community continues to embrace renewable energy and sustainable practices, the transition from fossil fuels to clean energy is reshaping industries. At the heart of this transition lie critical minerals.

According to The Energy Act of 2020 “critical minerals are those that are essential to the economic or national security of the United States; have a supply chain that is vulnerable to disruption; and serve an essential function in the manufacturing of a product.” Resources like lithium, cobalt, and nickel are essential to building the infrastructure of a lower-emission future. These materials power everything from electric vehicles (EVs) to wind turbines and electricity networks, which represent the foundation of a sustainably constructed, environmentally friendlier economy.

As demand increases for these minerals, however, businesses and investors face a challenge: how to identify optimal locations for mining and sustainable energy operations. This site selection dilemma is where Geospatial Energy & Mining (GEM) from Hubexo comes in: our comprehensive coverage from planned renewables projects to oil and gas pipelines, as well as the mines which are sourcing the aforementioned critical minerals, is unique as a lead generation and site selection solution for the energy and mining industries. No ifs, ands or buts, our planned energy and mining project data is a game-changer for everyone from construction professionals to major energy companies.

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Building the Clean Energy Economy with Critical Minerals

Critical minerals serve as the backbone of clean energy technologies. Consider lithium, often referred to as “white gold” for its essential role in EV batteries. Without it, the widespread adoption of electric vehicles would stall, delaying progress toward reduced transportation emissions. Similarly, cobalt and nickel are key components in battery storage systems, enabling renewable energy grids to maintain consistent power.

Which Critical Minerals do What for Renewable Energy?

1. Electric vehicle batteries (lithium, cobalt, nickel)
2. Wind turbines (rare earth elements such as neodymium and dysprosium)
3. Solar panels (tellurium, indium, and silicon)
4. Energy grids (copper for electrical wiring and storage systems)

Crucially, this transition hasn’t negated the ongoing significance of oil and gas. For instance, in 2023, the United States produced record amounts of crude oil, 12.9 million b/d, a 9% (1.0 million b/d) increase from 2022. This highlights the ostensibly inevitable role fossil fuels will play in tandem with renewable energy going forward.

How GEM Data Supports Smarter Energy Project Site Selection

GEM from Hubexo offers a data platform which provides companies with the insights they need to navigate this complex terrain. Whether you’re looking to select the right site, generate work leads, or simply conduct market and competitive research and analysis in the energy or mining sectors, GEM is the tool for you.

Generate Work Leads

Whether planning renewable energy installations or evaluating oil and gas pipelines, GEM’s geospatial tools provide a comprehensive view of nearby infrastructure, resource availability, and potential environmental impact. Including government-supported renewable projects or ongoing oil and gas exploration.

Planned Energy Projects layered by Railroads and Natural Gas Pipelines

Competitive Research Analysis

GEM enables companies to locate regions with abundant critical mineral reserves, such as lithium in the Smackover Formation in southern Arkansas. According to the U.S. Geological Survey, this region alone could hold between 5.1 and 19 million tons of lithium in its brines—an opportunity too significant to ignore. With layers of data on environmental impact and population demographics, GEM helps companies make decisions that balance profitability with sustainability. With the increasing frequency of natural disasters like forest fires, smart site selection has become more critical (wink) than ever. Studies are finding that extreme weather events are intensifying due to climate change, highlighting the need for tools like GEM that integrate data on environmental impact and population demographics. This ensures companies can make decisions that balance profitability and mitigate the financial risks associated with worsening weather conditions.

Track Natural Disasters in Real Time

Opportunities with Mining Critical Minerals

Economic Growth

Mining significantly impacts local economies by creating jobs, developing infrastructure, and boosting commerce. The direct employment opportunities provided by mining operations and related services stimulate economic growth. Mining companies often hire local workers for roles such as equipment operators, geologists, engineers, safety inspectors, and environmental specialists. They also contract specialized services for heavy machinery maintenance, explosives handling, and site construction, alleviating unemployment and improving living standards.

Moreover, mining can spur local entrepreneurship. Increased economic activity and demand for services drive the growth of small businesses, providing diverse income sources for local communities.

Sustainable practices are vital, however, to ensuring the long-term benefits of mining for their communities, supply chains, and dependent economies. Striking a balance between economic development and environmental stewardship requires responsible extraction, effective community engagement, and a commitment to minimizing environmental impacts.

Global Geopolitics

Nations rich in critical minerals, like the U.S., can reduce reliance on foreign imports and gain a competitive edge in clean energy production. The U.S. is rich in coal, copper, gold, iron ore, lithium, molybdenum, silver, uranium, and phosphate. Building mineral security has long been recognized as a bipartisan goal in Washington. In 1910, the United States established the Bureau of Mines to coordinate mineral security efforts. Over the last seven years, however, a renewed sense of urgency has emerged as the U.S. recognized the risks of relying heavily on China for critical minerals, which posed significant threats to national and energy security as well as economic competitiveness.

The United States is leveraging its rich reserves of critical minerals—coal, copper, lithium, and more—to reduce reliance on foreign imports, particularly from China, and secure its position in clean energy production. This pursuit, rooted in initiatives like the Bureau of Mines founded in 1910, has gained urgency in recent years as the U.S. confronts risks tied to China’s dominance in critical mineral supply chains, which threaten national security and economic competitiveness.

Historically, the U.S. has relied on regions such as Africa and the Middle East to harvest native critical minerals and resources, raising concerns about ethical and sustainable extraction practices. Domestically, policies like banning or restricting Chinese electric vehicles underline the importance of fostering local development for resource harvesting.

The U.S. government has since enacted significant measures to address these vulnerabilities, including the Inflation Reduction Act, CHIPS and Science Act, and the Infrastructure Investment and Jobs Act. They have also reinforced initiatives like the Minerals Security Partnership and increased funding through the Defense Production Act. Despite these advancements, the U.S. remains heavily reliant on China, which has maintained a decades-long advantage in critical mineral production and processing.

Sustainability Goals

The U.S. has committed to reducing greenhouse gas emissions by 50-52% below 2005 levels by 2030 as part of its re-entry into the Paris Climate Accords under the Biden Administration, though the Trump Administration has recently withdrawn from the agreement. The current strategy emphasizes clean energy technologies and domestic resource development to meet these goals.

Critical minerals play a pivotal role in achieving net-zero carbon targets by 2050, as outlined by the International Energy Agency (IEA). Clean energy transitions have significantly increased demand for essential materials like lithium, nickel, cobalt, graphite, and rare earth elements. These minerals are vital for technologies such as electric vehicle (EV) batteries, wind turbines, and solar panels, which are critical to reducing emissions and transitioning to renewable energy.

The U.S. government’s decision to restrict Chinese EV imports highlights the rising costs of such vehicles domestically. However, it also underscores the urgency of developing local supply chains for these critical minerals. By fostering efficient and responsible domestic mining and processing, the U.S. can reduce its dependence on imports while promoting sustainable growth in clean energy sectors.

Today, the market value of key energy transition minerals stands at approximately USD 325 billion, comparable to that of iron ore. By 2040, under the Net Zero Emissions (NZE) Scenario, this figure is expected to more than double, reaching USD 770 billion. Demand for critical minerals for clean energy technologies is set to nearly triple by 2030 and quadruple by 2040, reaching nearly 40 million metric tons.

IEA (2024), Market value of key energy transition minerals in the Announced Pledges Scenario and the Net Zero Scenario, 2023-2040, IEA, Paris https://www.iea.org/data-and-statistics/charts/market-value-of-key-energy-transition-minerals-in-the-announced-pledges-scenario-and-the-net-zero-scenario-2023-2040, Licence: CC BY 4.0

Challenges with Mining Critical Minerals

Mining critical minerals, essential for clean energy technologies, presents several significant challenges. The process is highly labor and machinery intensive, requiring specialized equipment and skilled workers, which drives up operational costs and limits scalability. Additionally, the industry faces steep financial demands, as the expenses associated with mining, refining, and transporting these materials make it one of the most capital-intensive sectors. There are also strict regulations and lengthy permitting processes designed to ensure environmental and safety compliance. While these safeguards are important, they contribute to bureaucratic delays, slowing down project timelines and further increasing costs, a typical mining project often loses 1/3 of it’s value as a result of these delays.

Environmental Impact of Mining Critical Mineral

Mining critical minerals presents significant environmental challenges, particularly in regions already vulnerable to climate change. Mining operations can disrupt ecosystems, deplete water resources, and contribute to pollution. For instance, most methods used to mine critical minerals require substantial water for processes such as separating minerals, cooling machinery, and controlling dust. Waste from mining and processing, including residual minerals and chemicals, can contaminate water sources in nearby communities, compounding the environmental strain. Because mining is so disruptive, it’s essential that conscious site selection be part of any new mining developments which care to fulfill the purpose of truly sustainable development which benefits all people, communities, and economies subject to it.

Lithium extraction is especially water-intensive. In South America’s “lithium triangle,” which spans parts of Chile, Argentina, and Bolivia and holds over half the world’s lithium reserves, miners pump brine from salt flats into large evaporation pools. Extracting one ton of lithium carbonate—used in EV batteries and solar panels—requires up to half a million gallons of brine water. Although brine water itself is unsuitable for drinking or agriculture, its extraction can disrupt freshwater systems. Freshwater can flow into brine aquifers, mixing with saltwater and leading to salinization.

Meanwhile, the United States is home to significant lithium deposits, particularly in Arkansas, which has emerged as a hotspot for lithium brine extraction. The Smackover Formation in southern Arkansas holds massive potential for lithium production, positioning the region as a key player in meeting rising global demand. Beyond lithium, the U.S. boasts other critical mineral supplies, including rare earth elements in California’s Mountain Pass mine, cobalt in Idaho’s Blackbird District, and nickel deposits in Minnesota’s Duluth Complex.

In Chile’s Salar de Atacama, a key lithium and copper mining region, extraction activities consume over 65% of the local water supply. This depletion impacts Indigenous farming communities, leaving them with reduced access to water in an already arid region. Moreover, toxic waste from lithium operations has contaminated drinking and agricultural water sources, further harming Indigenous populations.

Community Resistance

Mining critical minerals brings both opportunities and challenges to local communities and ecosystems. On one hand, it creates jobs, stimulates local economies, and strengthens energy security by reducing reliance on foreign imports. As we now know, critical minerals are essential for achieving sustainability goals, as they power renewable energy technologies and support the global transition to cleaner energy sources.

Indigenous communities have long resisted oil and gas pipelines that threaten their lands, cultures, and environments. Notably, the Dakota Access Pipeline (DAPL) in North Dakota became a focal point of such resistance. In 2016, the Standing Rock Sioux Tribe and allied groups initiated protests against DAPL, arguing that its route endangered sacred sites and the tribe’s water supply. The movement garnered international attention, highlighting the broader struggle for Indigenous rights and environmental justice. 

Similarly, in Nevada, the proposed Thacker Pass lithium mine has faced opposition from Indigenous groups. The mine’s location is near sacred sites and could disrupt traditional practices. This situation underscores the tension between the demand for critical minerals and the rights of Indigenous peoples. 

Mining can also negatively impact communities and the environment. Operations may force people from their homes, restrict access to clean land and water, disrupt livelihoods and lead to severe consequences for peaceful protestors at the hands of police commissioned by certain developing companies. Social divisions often arise over who benefits from the mine, while secrecy surrounding tax payments and benefit-sharing exacerbates tensions. Additionally, inadequate consultation with local populations can lead to mistrust and resistance.

Supply Chain Bottlenecks

These minerals are often sourced from regions far from where they are consumed, leaving supply chains vulnerable to disruptions from a variety of sources. Events such as the Suez Canal blockage in 2021, where a massive container ship got stuck and halted shipping traffic for days, are prime examples of the types of disruptions that can throw supply chains into disarray. According to discussions anticipated at the upcoming World Trade Organization (WTO) Trade and Environment Week 2024, building resilient and sustainable critical minerals supply chains is essential for supporting clean energy technologies and other modern innovations. However, this process is complicated by environmental, social, and governance (ESG) concerns, as well as international trade and environmental laws that govern the extraction and processing of these resources.

In response to these complexities, initiatives like the Minerals Security Partnership (MSP) have emerged to foster responsible growth in the critical minerals sector. This U.S.-led partnership, launched in June 2022, emphasizes high ESG standards, sustainability, and shared prosperity. With 23 participating partners, including major economies like Australia, Canada, and the EU, the MSP aims to enhance cooperation and promote resilient supply chains.

Balancing Energy and Mining Development

Take the Permian Basin in Texas, “one of the oldest and most well-known hydrocarbon-producing areas“. While fossil fuel production continues to thrive there, companies are also exploring opportunities to co-locate renewable energy projects. Using GEM, businesses can evaluate how existing infrastructurE — pipelines, workforce availability, and proximity to markets — can support dual-purpose operations that integrate oil, gas, and renewables.

As we move toward a renewable energy future, we must recognize the necessity of continuing fossil fuel production, particularly in regions like the Permian Basin, where these resources remain essential for economic stability, job creation, and global energy security. The transition to renewables is necessary, but fossil fuels are not disappearing overnight. We must balance the need for a sustainable future with the ongoing reality of fossil fuel dependence. At the same time, companies bear a responsibility to pursue their sustainability goals while minimizing harm to people, communities, and the environment.

Powering the Future with GEM

The transition to a sustainable energy future isn’t just about shifting from oil to renewables; it’s about building smarter, more resilient systems that leverage all available resources. GEM from Hubexo equips investors, developers, and energy companies with the insights they need to navigate this evolving landscape. Whether for lead generation, site selection, market research or competitive analysis, GEM could be the solution for your business.

Whether you’re seeking to mine lithium for EV batteries or invest oil and gas projects, GEM is your partner in making data-driven decisions that align with both business goals and sustainability objectives.

Explore GEM Today and unlock the tools you need to lead in energy and mining development.