An introduction to the nexus between the energy transition, critical raw materials, and mining-related deforestation.
This edition of “The E-Waste Newsletter” was written by Christine Nikander and Heidrun Kordholste-Nikander.
The growing material demand to reach net zero
According to recent research from the World Benchmarking Alliance and the Carbon Disclosure Project evaluating “corporate action against the United Nations’ Sustainable Development Goals”, the “energy transition is currently progressing too slowly”. Their “assessment of 68 of the world’s largest and most influential electric utilities companies” showed that these companies’ “total share of wind and solar generation almost doubled to 7% of the energy mix between 2017 and 2022”. Notably however, the companies “are still falling substantially short of the speed and scale needed to limit global warming to 1.5C and keep our planet habitable”. The research found that only 15% of the companies “have net-zero targets aligned with the International Energy Agency's net-zero emissions growth requirements”. Moreover, “[o]nly 43% of companies using coal generation currently have plans to phase it out”.[i]
To reach the goal of having net zero emissions by the middle of the century, a rapid transition over to renewable energies is needed. Yet, the production of solar panels, wind turbines, electric vehicles, and batteries requires large quantities of minerals – such as copper, lithium, and nickel. The minerals needed to produce renewable technologies are both of strategic and economic importance. In line with this, they are sometimes referred to as “transition minerals”.[ii]
As the need for renewable energy technologies grows, the exploration and extraction of transition minerals will continue to increase. According to the International Energy Agency, 7 million tons of transition minerals were mined globally in 2020. To stay under the 2°C threshold, the production of transition minerals needs to be scaled up to around 28 million tons annually. Given the lower energy efficiency of fossil fuels and the continuous material and energy input required for a fossil fuel infrastructure, a fossil fuel economy however requires significantly more (roughly 500 to 1000 times more) mining than a clean energy economy does.[iii]
How does mining contribute to forest and biodiversity loss?
Opencast mining can cause a loss of both habitats and biodiversity.[iv] Opencast mining often results in large-scale land destruction. The terrain is permanently altered, and hydrological conditions change.[v] Mining also brings the construction of settlements and infrastructure with it, which results in more losses of forests.[vi] In some cases, water and soil can be polluted and effect a much larger area than the actual mining area. As an example, the Escondida copper mine in the Atacama Desert in Chile has “a very large land footprint, require[s] large water and energy inputs and generate[s] large amounts of mining waste”.[vii]
Mining is a driver of deforestation. In recent years, mineral extraction in the tropical rainforests has been on the rise. Since 2000, the forest loss has been especially significant in Brazil, Peru, Colombia, Venezuela, Indonesia, Russia, Canada, the US, Australia, Ghana, and Myanmar. It should be noted that these countries do not use or consume all the metals and minerals they mine themselves, but that these are largely extracted for consumption in other countries. In many of the countries where mineral extraction occurs, mining sadly does not even stop the downgrading and downsizing of nature reserves or national parks. The downgrading and downsizing of protected land has impacted at least 130 million hectares (321 million acres) globally, according to Conservation International. In Brazil alone, 219 mining claims extend to protected areas.[viii]
Up until now, the majority of the mining-related deforestation has been caused by gold and coal mining – with a toll of ca. 6 877 square kilometers (4 273 square miles) of forest loss in the last two decades alone. With the rising demand for critical minerals, critical mineral mining could however end up taking an even bigger toll on forests than gold and coal mining has had to date.[ix]
Why is it vital to protect forest biodiversity?
More diverse forests – with “more different species with individual genetic codes” living in them – are better at coping with environmental and climate change. In line with this, “[n]atural forests are one of the most important and stable stores of carbon”. Overall, deforestation is “estimated to contribute as much as 20% to global annual greenhouse gas emissions”.[x]
It is also worth noting that forests provide a multitude of other ecosystem services. Over three-quarters of “accessible fresh water [globally] comes from forested catchments”. Forests are the source for many traditional medicines, which large populations in developing countries rely on.[xi] Forests also provide firewood, wild food, and resources for peoples’ livelihoods for over 90% of those living in extreme poverty. Overall, forests are estimated to “provide more than 86 million green jobs”.[xii]
As it is not possible to “protect the Earth’s biodiversity without protecting our forest”, action to halt deforestation needs to be taken urgently.[xiii] Over the course of the past few years, the EU has therefore enacted several new laws that aim to help prevent or reverse global deforestation and habitat loss trends. The most significant amongst these include the EU’s Nature Restoration Law, the Regulation on Deforestation-free Products (EUDR), and the Corporate Sustainability Due Diligence Directive (CSDDD). While the Nature Restoration Law sets binding targets on EU member states to restore ecosystems, the EUDR and CSDDD require companies to carry out due diligence and risk assessments.
Biodiversity protection under the EU’s Deforestation Regulation
The EUDR aims to make sure that “the products EU citizens consume do not contribute to deforestation or forest degradation worldwide”. With the regulation, the EU also aims to reduce its greenhouse gas emissions and preserve biodiversity.[xiv] Under the regulation, only products and raw materials that are “deforestation-free” since 2020, produced in accordance with national laws, and come with a due diligence declaration may be traded and marketed on the EU market.[xv]
The regulation came into force on 29 June 2023. It applies to companies of all sizes – so long as they are importing, placing, or exporting given products or raw materials to, on, or from the European market. For large companies, compliance is necessary as of 30 December 2024. For SMEs or small businesses, compliance is necessary as of 30 June 2025.[xvi]
To factor in changes in deforestation patterns, the list of materials that fall under the scope of the regulation is updated regularly. These currently include wood, oil palm, soy, natural rubber, cattle, coffee, and cocoa. Over 800 derived product categories – including furniture, glycerine, leather goods, paper and print products, plywood, soya oil, and tires – that are made of these materials fall within the scope of the regulation.[xvii]
Under the regulation, a product or raw material is “deforestation-free” if it does not contain, has not been fed with, or has not been made using supplies produced on land converted (by humans or otherwise) from forest to agricultural use after 31 December 2020. Companies must comply with the production countries’ laws on environmental protection and forest-related rules (such as forest management and biodiversity conservation). Additionally, they must comply with domestic labour rights, land use rights, third parties' rights, as well as tax, anti-corruption, trade, and customs regulations. Notably, the EUDR also requires companies to uphold human rights protected under international law and follow the principle of free, prior and informed consent (FPIC) as set out in the UN Declaration on the Rights of Indigenous Peoples.[xviii]
As extensive due diligence and large datasets are commonly needed to prove compliance with the EUDR, companies should start their compliance work as soon as possible. Non-compliance can result in the confiscation of profits and fines of up to 4% of the company’s annual turnover within the EU. Notably, these sanctions will be applied across the entire supply chain, encompassing affected raw materials, products, and generated revenues.[xix]
Ways toward more sustainable development
Mining often occurs “in remote, ecologically sensitive and less-developed areas that include many indigenous lands and territories”.[xx] Mining comes with a lot of risk and both actual and potential adverse effect. For example, when mining operations are managed poorly, they can “lead to environmental degradation, displaced populations, inequality and increased conflict”.[xxi] Overall, the failure “to engage meaningfully with the SDGs will put [mining companies] operations at risk in the short and long term”.[xxii]
On the flipside, mining operations can “generate profits, employment, and economic growth in low-income countries”.[xxiii] If managed well, they “can create jobs, spur innovation and bring investment and infrastructure”.[xxiv] It is expected that companies committing “to the SDGs will benefit from improved relationships with governments and communities, as well as better access to financial resources”. [xxv] In line with this, companies active in the mineral extraction and mining sectors should take steps “to extract responsibly, waste less, use safer processes, incorporate new sustainable technologies, promote the improved wellbeing of local communities, curb emissions, and improve environmental stewardship”.[xxvi]
When it comes to mining, it is difficult to overemphasize “the importance of multi-stakeholder partnerships and the involvement of all stakeholder groups at national, sub-national and regional levels”. [xxvii] For example, “through partnerships with government and civil society, mining companies can ensure that benefits of mining extend beyond the life of the mine itself, so that the mining industry has a positive impact on the natural environment, climate change, and social capital”.[xxviii] Multi-stakeholder partnerships can also “make supply chains more sustainable” and make it possible “to extract the […] raw materials” needed for the energy transition “in a socially and environmentally friendly manner”.[xxix]
Mining companies – and electronics producers further down the supply chain – willing to take on responsibility for protecting forest biodiversity should carefully assess and address the environmental and social implications of mining critical raw materials. They should be conscious of the social license needed for mining operations, for which the expectations and standards are often far higher than what is required under the law. In line with this, they should set up better company policies, collaborate with producers and other stakeholders, and shift over to using circular business models.
Would you be interested to learn more about biodiversity considerations in the life cycle of an electric vehicle battery? You can now explore the impacts and EU regulations that apply to the different life stages of an EV battery in Palsa & Pulk’s interactive visual.
The next newsletter will explore how the mining of critical raw materials impacts Indigenous Peoples’ rights. If you want to be notified when it comes out, please subscribe to our mailing list.
About the authors
Christine Nikander is the founder of the environmental and social sustainability consultancy, Palsa & Pulk. She has been doing research into the legal and policy framework surrounding global supply chains and critical raw minerals since 2015. Christine studied law at the universities of Columbia (New York), Edinburgh (Scotland), and Leiden (the Netherlands). She has been writing The E-Waste Column weekly since 2022.
Heidrun Kordholste-Nikander is a freelance biodiversity & forestry consultant at Palsa & Pulk. Her core competences lay in implementing sustainability into forestry and agricultural practices. Heidrun also advises clients on how to protect biodiversity. Heidrun studied forest management and environmental protection technology in Munich (Germany) and North American studies in Helsinki (Finland). Through her consultancy work, she hopes to help companies make science-based sustainability decisions that are practical, pragmatic, and effective.
About The E-Waste Column
The E-Waste Column is a weekly column about e-waste, transition minerals, and critical raw materials. It touches on a range of topics including ESG, sustainable development, circular economy, EU law and policymaking, corporate social responsibility, the transition to renewable energy, the EU Green Deal, supply chain due diligence and auditing, human environmental rights, business and human rights, climate law, and corporate sustainability.
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Our weekly column is published on Wednesdays at 12PM CET (The Hague) or 6AM EST (New York) on our website and on LinkedIn. Our monthly newsletter is published here on our blog, on Substack, and on LinkedIn.
[i] Caroline Avan, Vicky Sins: Comment: The renewable energy revolution will only happen in time if no one is left behind. https://www.reuters.com/sustainability/society-equity/comment-renewable-energy-revolution-will-only-happen-time-if-no-one-is-left-2023-11-22/ (21.08.2024); Jack Grogan-Fenn, Renewables Sector Unprepared to Provide “Fair” Transition – BHRRC. https://www.esginvestor.net/live/renewables-sector-unprepared-to-provide-fair-transition-bhrrc/ (21.08.2024); Business & Human Rights Resource Centre, Renewable Energy & Human Rights Benchmark 2023. https://www.business-humanrights.org/en/from-us/briefings/renewable-energy-benchmark-2023/ (21.08.2024)
[ii] Business & Human Rights Resource Centre, “You can’t eat lithium”: Community consent and access to information in transition mineral mining exploration. https://www.business-humanrights.org/en/from-us/briefings/tmt-2021/you-cant-eat-lithium-community-consent-and-access-to-information-in-transition-mineral-mining-exploration-in-europe-and-north-america (21.08.2024); International Energy Agency: The Role of Critical Minerals in Clean Energy Transitions. https://www.iea.org/reports/the-role-of-critical-minerals-in-clean-energy-transitions (21.08.2024); World Bank Group: Climate-Smart Mining: Minerals for Climate Action. https://www.worldbank.org/en/topic/extractiveindustries/brief/climate-smart-mining-minerals-for-climate-action; Dolf Gielen: Critical Materials For The Energy Transition, International Renewable Energy Agency Technical Paper 5/2021. https://www.irena.org/-/media/Irena/Files/Technical-papers/IRENA_Critical_Materials_2021.pdf?rev=e4a9bdcb93614c6c8087024270a2871d(21.08.2024)
[iii] International Energy Agency: Mineral requirements for clean energy transitions. https://www.iea.org/reports/the-role-of-critical-minerals-in-clean-energy-transitions/mineral-requirements-for-clean-energy-transitions (21.08.2024); Carly Leonida: Meeting the Sustainable Development Goals through mining. https://theintelligentminer.com/2023/01/19/meeting-the-sustainable-development-goals-through-mining/; Fair Cobalt Alliance: #WEF23 - Mining is key to a Just Energy Transition. https://www.linkedin.com/pulse/wef23-mining-key-just-energy-transition-fair-cobalt-alliance/?trackingId=TNmwTnUHTw2hNORNtkYpjg%3D%3D (21.08.2024); Hannah Ritchie: Mining quantities for low-carbon energy is hundreds to thousands of times lower than mining for fossil fuels. https://hannahritchie.substack.com/p/mining-low-carbon-vs-fossil (21.08.2024); Michael Thomas: A Fossil Fuel Economy Requires 535x More Mining Than a Clean Energy Economy. https://www.distilled.earth/p/a-fossil-fuel-economy-requires-535x (21.08.2024); Tobiah Palm: Zeldzame metalen ontdekt in Zweden. ‘Europa heeft meer mijnbouw nodig’. https://www.trouw.nl/duurzaamheid-economie/zeldzame-metalen-ontdekt-in-zweden-europa-heeft-meer-mijnbouw-nodig~b76e0051/ (21.08.2024)
[iv] European Environment Agency: Biodiversity – Ecosystems, published on 18 Jun 2008, last modified 10 Feb 2020: https://www.eea.europa.eu/themes/biodiversity/intro (22.01.2024)
[v] Yuan Gao, Jinman Wang, Nin Zhang, Sijia Li: Measurement and prediction of land use conflict in an opencast mining area. https://www.sciencedirect.com/science/article/abs/pii/S0301420721000167 (25.04.2024)
[vi] Maxwwell, Radwin: Mongabay News & inspiration from nature’s frontline; Mining may contribute to deforestation more than previously thought, report says. https://news.mongabay.com/2023/04/mining-may-contribute-to-deforestation-more-than-previously-thought-report-says/ (20.04.2024)
[vii] German Environment Agency: KlimRess – Impacts of climate change on mining, related environmental risks and raw material supply. https://www.umweltbundesamt.de/sites/default/files/medien/479/publikationen/texte_106-2020_klimress_case_study_chile.pdf (26.08.2024)
[viii] Maxwwell, Radwin: Mongabay News & inspiration from nature’s frontline; Mining may contribute to deforestation more than previously thought, report says. https://news.mongabay.com/2023/04/mining-may-contribute-to-deforestation-more-than-previously-thought-report-says/ (20.04.2024); Conservation International: How well protected are protected areas? Tracking legal changes to protected lands and waters. https://www.conservation.org/projects/paddd-protected-area-downgrading-downsizing-and-degazettement (26.08.2024)
[ix] Maxwwell, Radwin: Mongabay News & inspiration from nature’s frontline; Mining may contribute to deforestation more than previously thought, report says. https://news.mongabay.com/2023/04/mining-may-contribute-to-deforestation-more-than-previously-thought-report-says/ (20.04.2024)
[x] Convention on Biological Diversity: Forest Biodiversity. https://www.cbd.int/doc/meetings/cop/cop-09/media/cop9-press-kit-forest-en.pdf (21.08.2024)
[xi] Convention on Biological Diversity: Forest Biodiversity. https://www.cbd.int/doc/meetings/cop/cop-09/media/cop9-press-kit-forest-en.pdf (21.08.2024)
[xii] UN Environment Programme: Earth’s biodiversity depends on the world’s forests. https://www.unep-wcmc.org/en/news/earths-biodiversity-depends-on-the-worlds-forests (21.08.2024)
[xiii] UN Environment Programme: Earth’s biodiversity depends on the world’s forests. https://www.unep-wcmc.org/en/news/earths-biodiversity-depends-on-the-worlds-forests (21.08.2024)
[xiv] European Commission: Regulation on Deforestation-free products. https://environment.ec.europa.eu/topics/forests/deforestation/regulation-deforestation-free-products_en (21.08.2024)
[xv] Regulation (EU) 2023/1115 of the European Parliament and of the Council of 31 May 2023. https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32023R1115 (21.08.2024)
[xvi] Regulation (EU) 2023/1115 of the European Parliament and of the Council of 31 May 2023. https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32023R1115 (21.08.2024)
[xvii] Regulation (EU) 2023/1115 of the European Parliament and of the Council of 31 May 2023. https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32023R1115 (21.08.2024)
[xviii] Regulation (EU) 2023/1115 of the European Parliament and of the Council of 31 May 2023. https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32023R1115 (21.08.2024)
[xix] Regulation (EU) 2023/1115 of the European Parliament and of the Council of 31 May 2023. https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32023R1115 (21.08.2024)
[xx] Columbia Center on Sustainable Investment, UNDP, UN Sustainable Development Solutions Network, World Economic Forum: Mapping Mining to the Sustainable Development Goals: An Atlas. https://www.undp.org/sites/g/files/zskgke326/files/publications/Mapping_Mining_SDGs_An_Atlas_Executive_Summary_FINAL.pdf (26.08.2024)
[xxi] Columbia Center on Sustainable Investment, UNDP, UN Sustainable Development Solutions Network, World Economic Forum: Mapping Mining to the Sustainable Development Goals: An Atlas. https://www.undp.org/sites/g/files/zskgke326/files/publications/Mapping_Mining_SDGs_An_Atlas_Executive_Summary_FINAL.pdf (26.08.2024)
[xxii] Columbia Center on Sustainable Investment. Mining and the Sustainable Development Goals. https://ccsi.columbia.edu/content/mining-and-sustainable-development-goals (26.08.2024)
[xxiii] Columbia Center on Sustainable Investment. Mining and the Sustainable Development Goals. https://ccsi.columbia.edu/content/mining-and-sustainable-development-goals (26.08.2024)
[xxiv] Columbia Center on Sustainable Investment, UNDP, UN Sustainable Development Solutions Network, World Economic Forum: Mapping Mining to the Sustainable Development Goals: An Atlas. https://www.undp.org/sites/g/files/zskgke326/files/publications/Mapping_Mining_SDGs_An_Atlas_Executive_Summary_FINAL.pdf (26.08.2024)
[xxv] Columbia Center on Sustainable Investment. Mining and the Sustainable Development Goals. https://ccsi.columbia.edu/content/mining-and-sustainable-development-goals (26.08.2024)
[xxvi] Columbia Center on Sustainable Investment. Mining and the Sustainable Development Goals. https://ccsi.columbia.edu/content/mining-and-sustainable-development-goals (26.08.2024)
[xxvii] German Federal Ministry for Economic Cooperation and Development, The UN Sustainable Development Goals and Mining in the Andean countries – How does it fit together? https://rue.bmz.de/rue-en/releases/forum-nachhaltiger-bergbau-79418 (26.08.2024)
[xxviii] Columbia Center on Sustainable Investment. Mining and the Sustainable Development Goals. https://ccsi.columbia.edu/content/mining-and-sustainable-development-goals (26.08.2024)
[xxix] German Federal Ministry for Economic Cooperation and Development, The UN Sustainable Development Goals and Mining in the Andean countries – How does it fit together? https://rue.bmz.de/rue-en/releases/forum-nachhaltiger-bergbau-79418 (26.08.2024)
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