Emission-free technologies such as electric vehicles (EVs), solar panels,
wind turbines, and nuclear reactors are critical to reducing energy-related emissions
and fulfilling net zero goals by 2050.
There are nine minerals crucial for these technologies and their projected
compound annual growth rates (CAGR) in global market size from 2022 to 2027.
Sprott has identified the following minerals from
the U.S. 2022 Critical Minerals List as fundamental to the energy transition,
offering significant financial opportunities for investors as the transition accelerates.
Let’s delve into each one.
1.
Cobalt: Maximizes
the stability and longevity of batteries. Cobalt is part of the chemistry of 63%
of EV batteries worldwide.
2.
Copper: Essential
for conductivity in electrical infrastructure, including wind, solar, and EV charging
stations. In general, renewable energy systems can use up to six times more copper
than traditional ones.
3.
Graphite: The
largest component of lithium-ion batteries used for EVs and energy storage.
4.
Lithium: An
essential component of electrolytes in EV batteries and lithium-based energy storage
systems. By 2030, 95% of lithium demand is expected to come from batteries.
5.
Manganese: Used
as an electrode in many lithium-ion batteries for EVs.
6.
Nickel: A
key element in battery cathodes, offering higher energy density and longer driving
ranges for EVs.
7.
Rare earths: A vital
component in the magnets used in wind turbines and EVs.
8.
Silver: Essential
for conductivity in solar panels and other electrical infrastructure, possessing
the highest electrical and thermal conductivity among all metals.
9.
Uranium: The
fuel for nuclear power plants that can provide dispatchable and low-carbon power
to the electricity grid. Nuclear power ranks as the second-largest contributor to
low-carbon electricity production.
With demand escalating for clean energy technologies,
demand for their essential
components is also expected to grow,
offering avenues for investors to capitalize on the dynamic clean energy market.
Below we list the projected compound annual
growth rates (CAGR) for each of these minerals, which is their average annual growth
in market size over a specified period, taking into account the effects of compounding.
|
Mineral |
Compound Annual Growth Rate
(2022–2027P) |
|
Lithium |
25% (Source: ReportLinker) |
|
Silver |
9% (ReportLinker) |
|
Rare Earths |
8% (Technavio) |
|
Uranium |
7% (Technavio) |
|
Copper |
6% (Technavio) |
|
Cobalt |
6% (360 Markets and Updates) |
|
Graphite |
6% (IndustryARC) |
|
Nickel |
5% (Market Research Future) |
|
Manganese |
4% (IndustryARC) |
With an average projected CAGR of over 8%
through to 2027, driven especially by demand for lithium, silver, and rare earth
metals, investors are taking note.