Rare Earth elementsChinese monopoly on rare Earth metals a challenge for green economy

Published 4 April 2012

In order for clean technologies to contribute significantly to reducing greenhouse gases, the world would require an increase of neodymium and dysprosium – two of the seventeen rare Earth elements — of over 700 percent and 2,600 percent, respectively, in the next twenty-five years; the supply of these metals is currently increasing at 6 percent a year, and is under threat from China


Followers of the clean energy discussion have encountered discussions about the role of rare Earth metals at some point in the last year or two. There is a reason for this.

Rare Earth metals, such as yttrium, lanthanum, or cerium are formed from seventeen chemically similar elements and are not often found in large enough concentrations to be profitable. They are used in the manufacture of a wide range of technologies, from batteries to smartphones to military equipment. Because of their strong magnetic properties and high electrical conductivity, they are light in weight and efficient, making them critical to the clean energy industry. Wind turbines, energy-efficient light bulbs, electric car batteries, and efficiency motors/generators all depend on dysprosium, neodymium and their other cousins to generate the magnets that make them work. So far no substitute has been found that can match rare earths in weight and efficiency.

A Columbia University release reports that historically, their rarity has not posed a problem because there has been adequate supply to meet global demand. Questions are being raised now about the future of the supply. China mines 94 percent to 97 percent of the rare Earth metals globally, and while there have been increasing efforts in the United States and Europe to find alternative supplies, the complex and highly polluting extraction process is proving problematic. China’s global monopoly is an increasing worry: their halt of rare earth exports to Japan in 2010 (following a dispute between the two countries over some small islands in the Pacific ocean) led to a 30-fold increase in the price of rare earth metals by the summer of 2011; with a subsequent plummeting of up to three fifths from that price, indicating the current volatility.

Two weeks ago, the United States, EU, and Japan filed a formal request for consultation with the WTO about China’s increasing restrictions on the exports of their rare earth metals. There will be a legal case in May 2012 if China does not agree to the demands.

This constraint on supply is worrying for climate change because if clean technologies are to contribute significantly to the reduction of greenhouse gas emissions, then the supply of rare Earth metals needs to increase with the growth in the sector. Randolph Kirchain, Elisa Alonso, and Frank Field, of MIT, recently explained in Environmental Science & Technology that in order for clean technologies to contribute significantly to reducing greenhouse gases, we would require an increase of neodymium and dysprosium of over 700 percent and 2,600 percent respectively in the next twenty-five years. The supply of these metals is currently increasing at 6 percent a year, and is under threat. In order to meet demand for clean technologies, the supply would have to increase by 8 percent and 14 percent.

The release notes that geologists, scientists, planners, governments, and anyone playing a role in the clean technology market needs to start thinking about how these materials can be used more efficiently, finding new sources, and ultimately reducing reliance. If not, we are could lose out on the opportunities provided by alternative energy sources.

— Read more in Elisa Alonso et al., “Material Availability and the Supply Chain:  Risks, Effects, and Responses,” Environmental Science & Technology 41, no. 19 929 August 2007): 6649–56 (DOI: 10.1021/es070159c)