White House turns to California desert for lithium boost
Seeking to break China’s monopoly of the lithium battery market, the Biden administration on Tuesday announced millions in taxpayer dollars to spur domestic mining opportunities in the American West.
President Joe Biden said the funds will boost a fledgling mining operation in California and help reduce the country’s reliance on China for lithium batteries and magnets used to power electric vehicles, wind turbines and electronics. He highlighted various ongoing or planned private-sector projects, including a pilot battery recycling plant in Nevada sponsored by Ford and Volvo.
The first-term Democrat said jumpstarting new mining operations and recycling plants dovetails with the Biden administration’s progressive environmental agenda.
“We can’t build a future that’s made in America if we are so dependent on China for the materials that power the products of today and tomorrow,” said Biden.
During a virtual press conference, Biden said the Department of Defense has awarded $35 million to MP Materials to expand its rare earth metals processing plant in California’s Imperial Valley. The California-based company plans to spend more than $700 million to create a permanent domestic magnet supply by 2024.
Biden also touted a separate planned extraction project which aims to produce commercial battery grade lithium in the California desert. If the multibillion-dollar pilot project is a success, Berkshire Hathaway says the facility could produce 90,000 metric tons of lithium per year.
Lithium is a main component of batteries used to power the burgeoning electric vehicle industry, cellphones and residential solar power systems. Currently most of the lithium consumed by the U.S. comes from the so-called “lithium triangle” beneath Argentina, Bolivia and Chile. But China boasts the bulk of the world’s lithium refining capability and a healthy supply of unearthed lithium reserves.
With global manufacturing demand for lithium and other metals like cobalt, nickel and graphite predicted to continue skyrocketing, countries are looking to transform the lithium supply chain currently dominated by China.
While Biden said propping new extraction efforts isn’t an “anti-China” endeavor, he acknowledged the future of the U.S. economy is fundamentally tied to having a reliable source of the metals. Thus, he’s turning to California’s largest lake — experts believe some of the world’s largest remaining lithium deposits are buried deep beneath the Salton Sea.
California has been studying for years whether lithium can be extracted in an environmentally sound manner in Imperial County, home to the Salton Sea, Anza-Borrego Desert State Park and thousands of acres of farmland sustained by water irrigated from the Colorado River.
The federal government’s support for a privately operated lithium industry will bring badly needed new jobs and economic stability to a county that continues to register some of the highest unemployment levels in the nation, California Governor Gavin Newsom said.
The Democratic governor applauded Biden for backing California’s quest to turn Imperial County into the “Saudi Arabia of lithium” and diversify its renewable energy goals.
“If it’s as big as it appears, this is a game-changer in terms of our efforts to transition to low carbon green growth and radically change the way we produce and consume energy,” said Newsom. “This is a hinge moment in history.”
As part of its investment, a Berkshire Hathaway representative said the multinational conglomerate would beef up training programs to create a permanent labor pool in Imperial County.
“If this seems ambitious, it is, but there is no one better suited to take on an ambitious task like this than Berkshire Hathaway Energy,” said company CEO Alicia Knapp.
In a coordinated move, the Biden administration on Tuesday also announced the formation of a new working group focused on potential updates to mining laws that have been in place for over a century.
Environmental groups applauded the decision in a statement.
“For too long, Indigenous communities have borne the disproportionate impacts of the mining industry’s destructive practices, and the time has come for the U.S. government to truly respect the sovereignty of tribal nations and prevent mining in special places,” said Earthjustice senior legislative representative Blaine Miller-McFeeley. “In places where mining must occur, these principles, if appropriately implemented, will recognize the need for meaningful tribal consultation and engagement with all impacted communities to ensure that mining proceeds in the most sustainable way possible — not under antiquated laws from 150 years ago.”