(Bloomberg) -- The U.S. is set to give the mining industry a key tool to boost domestic production of metals behind the energy transition -- but nothing that speeds up efforts to dig ore out of the ground.
President Joe Biden is poised to add battery metals to the list of items covered by the 1950 Defense Production Act that could help mining companies access $750 million to fund production at existing operations, productivity and safety upgrades and feasibility studies, people familiar with the matter told Bloomberg. However, the changes to the act do nothing to streamline the permitting process.
It takes a about seven to 10 years to get a mine up and running in the U.S., compared to two to three years in neighboring Canada, according to the U.S. business group National Mining Association. The omission will frustrate mining companies when Biden is pushing to revive domestic production capacity while embracing a shift in the U.S. economy to less polluting energy.
“Unless we continue to build on this action, and get serious about re-shoring these supply chains and bringing new mines and mineral processing online, we risk feeding the minerals dominance of geopolitical rivals,” association President Rich Nolan said in an email. “We have abundant mineral resources here. What we need is policy to ensure we can produce them and build the secure, reliable supply chains we know we must have.”
The mining association said that there are a number of steps the U.S. can take to streamline the process and put it on par with Canada, including reducing duplication between state and federal government for approvals and setting specific deadlines.
Regardless, the Defense Production Act would be a huge step in bringing legitimacy to U.S. companies with battery-metals projects seeking to attract more capital to expand businesses and help create a self-sustaining domestic industry.
Demand for key battery metals including lithium, nickel, graphite, cobalt and manganese has surged in recent years as consumer adoption of electric vehicles including Teslas and battery-powered Ford Mustangs has accelerated.
The green-energy transition is estimated to boost global lithium consumption fivefold by the end of this decade, according to BloombergNEF. The only lithium production in the U.S. last year was from one brine operation in Nevada, according to the U.S. Geological Survey, woefully short of what’s needed to supply every Tesla made in America.
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