Department of Mineral & Energy Economics
Rare Earth Markets and Their Affects
on Solar and Wind Power
Professor Daniel J. Packey, Ph.D.
Head of the Department of Mineral and Energy Economics
Curtin Graduate School of Business
Curtin University
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Few (if any) Known Substitutes
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Source: USGS
Department of Mineral & Energy Economics
2009 Mine Production
World Mine Production and Reserves (2009 Data)
Country
Production (Metric Ton)
Reserves (Metric Ton)
United States
insignificant
13,000,000
Australia
insignificant
5,400,000
Brazil
650
48,000
China
120,000
36,000,000
not available
19,000,000
2,700
3,100,000
380
30,000
not available
22,000,000
124,000
99,000,000
Commonwealth of Independent States
India
Malaysia
Other countries
World total (rounded)
Source: USGS
Department of Mineral & Energy Economics
Source: USGS
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Source: USGS
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Rare Earths Price Index 2002-2010
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REO Price Increases in 2010
Department of Mineral & Energy Economics
Market Domination
China has significant influence of rare
earth pricing and has, in the past, used it
to the disadvantage of competitors.
The financial markets may not be willing
to bear this risk.
Source: USGS
Department of Mineral & Energy Economics
Leveraging Resource Advantages
China’s export and tax regimes on Rare Earth
Oxides, element and metals restricts supply
outside of China and
“could be seen as a lure to bring Rare Earth
Technology manufacturing facilities into
China where the export quotas do not apply.”
Source: USGS
Department of Mineral & Energy Economics
"There is oil in the Middle East. There is Rare
Earth in China". Deng Xiaoping (1992)
China’s strategic resource monopoly
can be viewed as sovereign dominion
over critical resources, related
technology and intellectual property
Source: USGS
Department of Mineral & Energy Economics
Rare Earth Processing
Salt or Caustic Fusion
Acid leaching
Multistage solvent extraction
Resulting in:
A dark grey slightly radioactive (Thorium and/or
Uranium) sludge laced with toxic compounds
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Source: IEA
Department of Mineral & Energy Economics
Source: IEA
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Chinese Market Participation
The total market share for Chinese wind
turbine manufacturers is 30.5%
Mostly permanent magnet machines
Source: USGS
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Permanent Magnet Rare Earth Supply Chain
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Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Source: Dr. Bogi Jensen
Department of Mineral & Energy Economics
Dependency
Permanent magnets for generators
and other electrical machine
consume 40% of rare earth based
magnets
In 2010, 26,000 tons of Rare Earths
2015 estimate is 48,000 tons
15-30% deficit to production
Roskill Information Services - 2010
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Windpower developments
New Vestas Largest Windmills are still
wire wraped, geared generators.
The Permanent Magnet markets will
be strongly influenced by the Chinese
Control of the Rare Earth Markets
Department of Mineral & Energy Economics
Thin Film PV
All currently manufactured thin
film PV solar cells need either
Indium or Tellurium – both of
which are Rare Earth Elements
Source: USGS
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Chinese Market Participation
The total market share for Chinese
photovoltaics manufacturers is 27%
Mostly thin film photovoltaics
Source: USGS
Department of Mineral & Energy Economics
A Potential Chinese Development Strategy
There's another factor that could increase China's role as a central
figure in the renewables space: Its control of 95% of the rare earth
resources like Indium, Gallium and Lithium. These are central to the
functionality of solar cells (CIGS and CdTe) and battery technologies
for automotive and power storage applications.
This is not a surprise. But the announcement from Chinese officials
last month (July 2010) that it would decrease shipment of these
resources by 72% certainly was. The goal is for China to lure
technology companies over to the country by giving them access to
restricted resources. If it works, we may see a lot more clean energy
firms moving over to China.
Source: ttp://www.renewableenergyworld.com/rea/news/article/2010/08/rareearth-resources-increase-chinese-clout
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
Potential Competition in Photovoltaics
The new solar cells convert light into electricity using
a semiconductor material made of copper, zinc, tin,
and sulfur--all abundant elements--as well as the
relatively rare element selenium (CZTS). Reaching
near-commercial efficiency levels is a "breakthrough
for this technology," says Matthew Beard, a senior
scientist at the National Renewable Energy
Laboratory, who was not involved with the work.
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Photovoltaic Developments
PV Thin Films will be significantly
influenced by Chinese Rare Earth
Market Control
Due to market share soften by
Availability of Potential Substitutes
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Rare Earth/ Wind Power and Solar
Market Future
Chinese will continue to dominant the rare earth
refinery market due to refinery by-products.
This is independent of ore resources and
They are likely to use this to access (and
influence) new modern renewable energy (and
other) technologies markets.
Department of Mineral & Energy Economics
Department of Mineral & Energy Economics
The End