February 25, 2024

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Electric vehicle push brings North Carolina back to its lithium mining roots

Electric vehicle push brings North Carolina back to its lithium mining roots

The Kings Mountain hiking trail known as Cardio Hill overlooks a rainwater-filled crater the size of a lake, but the rocky terrain about 30 miles west of Charlotte is now one of the most expensive real estate in the United States.

Underneath that land is a mine that has been dormant since the 1980s and is believed to contain one of the country’s largest deposits of lithium, a crucial element in the batteries needed to power electric cars.

Albemarle, the world’s largest lithium producer, is trying to revive the mine and benefit from the Biden administration’s efforts to develop the local electric car industry. It’s just one of several projects underway in North Carolina, where companies are racing to obtain permits for billions of dollars in lithium investments, in part to try to take advantage of lucrative incentives included in President Biden’s new climate law.

On Thursday, Treasury Secretary Janet L. Yellen is in North Carolina to visit Livent, a lithium hydroxide processor that currently sources lithium from Canada and Argentina. The company expanded its factory in Bessemer, North Carolina, and increased its manufacturing capacity there by 50%, a decision it attributed to the Inflation Reduction Act, which includes tax incentives for American-made electric cars.

Ms. Yellen said during her tour that the United States is making progress in reducing its dependence on China through its energy initiatives.

“Key supply chains in areas such as clean energy are overly concentrated in China, in part due to decades of unfair market practices,” Yellen said. “With massive increases in domestic manufacturing capacity, our country will become less dependent on other countries for the inputs we need and we will make great strides toward energy security.”

Ms. Yellen suggested that investments like those in North Carolina would reduce energy costs and bring higher wages to low-income communities.

However, not everyone in this state welcomes the revival of lithium mining. Neighbors of the proposed mine projects have tried to derail plans to start drilling by raising concerns about pollution, soil erosion and the release of toxic chemicals, such as arsenic, that could contaminate local water supplies. Some environmental experts warn that promoters of lithium as a green energy solution are ignoring how carbon-intensive extracting the material is, comparing it to crushing or mining coal.

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“The real truth is that lithium extraction impacts the environment tremendously,” said Marco Tedesco, a research professor at Columbia University’s Lamont-Doherty Earth Observatory.

North Carolina was once a center for lithium production, but the industry faltered for decades amid foreign competition and a lack of domestic demand. That has changed since the 2022 Climate and Tax Act created significant subsidies to build a domestic electric vehicle supply chain that can compete with China. States like North Carolina have benefited from the lithium rush and become frontiers in the emerging battery belt.

The Biden administration will seek to boost domestic production on Friday, when it publishes proposed rules that will limit the extent to which foreign companies, especially in China, can go in supplying parts and products for American-made cars that are set to take in billions of dollars. In subsidies.

Eric Norris, president of energy storage at Albemarle, said the law helped revitalize an industry hurt by globalization and a weak market for lithium products in the United States.

“When you get some form of policy that says we all want you to build, and there’s money available for you, then you’re out of the equation,” Norris said. “It’s a way to compete globally in an industry that, frankly, we haven’t invested in or paid as much attention to.”

He added: “You know the story – China has paid a lot of attention.”

Albemarle received nearly $250 million in federal grants last year through Department of Defense and Department of Energy programs to boost domestic lithium production. It is one of several companies in North Carolina working to speed up extraction and processing of lithium, which is essential for the flow of electricity inside a battery, which can be sold to automakers.

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Although progress has been made in expanding North Carolina’s lithium industry, hurdles abound when it comes to the permits and pace of approvals producers need to move forward with their plans. The political backlash against electric vehicles, often fueled by Republicans including former President Donald J. Trump, is also a headwind. Lithium hydroxide prices have fallen sharply this year amid declining global demand, adding to the financial pressure companies face to make their investments pay off.

Albemarle has undertaken an extensive community awareness campaign to address concerns about its mining proposal. This has included town hall meetings, regular public tours of the site, and a dedicated office in a converted pharmacy where residents can visit to ask questions. Even if the permit process goes smoothly, the company does not expect the mine to be able to operate until 2027 or 2028.

And in Gaston County, North Carolina, Piedmont Lithium is struggling to get the support of local officials overseeing the zoning of the Carolina Lithium project. The company expects it can produce 30,000 metric tons of battery-grade lithium per year when its mine and processing plants are up and running. It plans to hire 500 workers with an average salary of more than $80,000 annually.

“We see ourselves at the forefront of what skilled labor can offer people in terms of wage opportunities,” said Patrick Brendel, Piedmont’s chief operating officer.

But many residents remain skeptical about what the mine will mean for their community. At a Gaston County Board of Commissioners meeting in August, homeowners expressed concerns about traffic and noise associated with the mine and expressed concerns about toxic chemicals leaking into the water system.

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“Why should I be financially ruined so they can make billions of dollars?” asked Sandra Foster, whose home is near the proposed mine.

Electric cars aim to reduce carbon emissions and improve environmental health, but in many projects across the country local officials are concerned about the short-term environmental risks posed by the transition.

Chad Brown, a board member, said it’s not certain Piedmont will get its permits, noting that the community is “rebellious.”

“Everyone is concerned about the environment,” Mr. Brown said.

The challenges have been exacerbated by the fact that the shift to clean energy technology has been the subject of political backlash from many Republican lawmakers.

Last year, North Carolina State Representative Ben Moss, a Republican, Legislation introduced It would prohibit free charging of electric vehicles unless free gasoline pumps are provided at the same location.

However, other Republican lawmakers, such as Sen. Thom Tillis of North Carolina, have been supportive of reviving lithium mining in the state. The state’s Democratic governor, Roy Cooper, said the environment needs to be protected, but a mine that can provide raw materials for electric car batteries is a positive development.

Local officials may ultimately be loathe to turn away thousands of new, well-paying jobs.

“My feeling is that the potential benefits from this will be significant enough that any of these political considerations will take a back seat,” he said. Mark Curtisa professor of economics at Wake Forest University who researches green energy jobs.

Ms. Yellen said Thursday that she recognized the environmental concerns, but the Biden administration supports lithium production as long as there are safeguards.

“It would be good to see lithium mining in the United States, but done in an environmentally appropriate way,” she told reporters.