Lithium We’ve Got a Problem; Let’s Talk Sustainable Extraction and U.S. Production of Lithium

Flat World Partners
6 min readMay 25

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Lithium-ion batteries are key to the energy transition. These batteries, found in everything from Tesla cars to solar panels, are made with lightweight and highly reactive materials (nickel, cobalt, lithium), making them the best battery for the energy transition due to their high energy density, long cycle life, and ability to be recharged. Due to the growing demand for lithium-ion batteries, the US is projected to be highly-import dependent on environmentally damaging lithium extraction methods.

The US relies on a global lithium battery supply chain that is vulnerable to disruption. Global manufacturing is highly concentrated. China controls the lion’s share with over 75% of cell production and over 60% of energy materials purification and refinement. Supply chain vulnerability is also increased by the high demand for raw minerals like lithium which far outstrip supply. The World Bank found that the world will need to mine five times more lithium than current levels of extraction to meet global climate targets by 2050.

The Biden administration has invested $92 billion into the US battery supply chain, representing 78 new manufacturing and processing facilities. The administration has increased investment through a variety of policy tools including the Inflation Reduction Act, the Infrastructure Investment and Jobs Act which allocated 2.8 billion in funding for battery projects, and the Defense Production Act — traditionally used in wartime — to increase American lithium extraction.

However, the greatest challenge is for the US to catch up to China’s control of lithium extraction. During the 1970s mining moved overseas and currently, there is only one active US lithium mine. This mine is in Nevada and is operated by mining giant Albemarle. In total, it manufactures just 1% of global lithium production. However, this is not due to a lack of reserves in the U.S. It is estimated that Nevada, North Carolina, and California contain 4% of the world’s lithium reserves.

Investment is growing through onshoring and ‘friend shoring’ initiatives, but it might not be enough to secure a stable lithium supply chain as China invests billions of dollars to control supply from mines in Zimbabwe, Ghana, and other African countries.

Bringing more of the lithium battery supply chain to the US and North America is an opportunity to clean up the supply chain and develop sustainable mining practices. The current method of lithium extraction has devastating environmental and social impacts. A recent study showed that mining one ton of lithium releases 15 tons of CO2. Further, lithium mining has historically been associated with social risks including child labor in the Democratic Republic of Congo and indigenous rights abuses in South America. New sustainable mining practices are needed now more than ever, and the US is well poised to bring about this change.

By bringing the different stages of the supply chain closer together, energy savings and cost savings are possible. Another way to reduce lithium mining’s carbon footprint is by using renewable energy to power mining operations which can also reduce energy costs. Accenture reports that decarbonizing mining operations will improve energy efficiency.

Recycling is another sustainable approach that can help reduce the need for new mines which also take years to become operational. Last year, Redwood Materials, a company founded by Tesla’s previous CTO JB Straubel, announced a $3.5 billion EV battery recycling plant in South Carolina. Recycled lithium also benefits lithium producers by reducing costs and hedging against volatility in raw material pricing.

Impact investors are seizing the opportunity to seek returns from onshoring the lithium supply chain. One fund, Vale, has created a $100 million fund to invest in sustainable mining startups mainly in North America.

The current lithium-ion battery supply chain presents strategic risks for the US as China dominates the industry as well as environmental and social risks associated with lithium mining. As investment in the US and North America increases it is critical that more sustainable practices, such as renewable energy-powered mining, recycling, and more data on the lithium supply chain, are adopted to mitigate the negative impact of lithium mining.

Ben Stevens, Intern

Snow Lake Lithium, a Canadian lithium mining company developing the world’s first all-electric lithium mine which will have access to 98% renewable hydroelectric power and will have no trucks or diesel emissions on site.

In an interview with, Electrek, a sustainable energy news platform, Snow Lake Lithium’s CEO Philip Gross, stated that “The biggest challenge … to help ensure more sustainable mining for lithium is to bring the battery refinement processes close to the actual source….” Decarbonizing lithium supply chains and more data on the footprint of lithium supply chains will minimize the environmental impact of the lithium industry.

There are two primary sources of lithium extraction: brine deposits and hard rock deposits. Extracting lithium from brine (large underground reservoirs of brackish water) involves pumping the brine to the surface and allowing the water to evaporate, leaving behind the lithium. The process is water-intensive and risks contaminating local water.

Lilac Solutions has developed a new ion exchange technology to extract lithium from brines without the need for evaporation ponds and requiring 1,000x less land. The technology yields an 80% lithium recovery rate compared to 40% recovery in the conventional brine extraction process.

Breve Storia di Lunghi Tradimenti is an Italian film released in 2012 with the English title The Lithium Conspiracy. The film follows Fabrizio, a successful businessman who embarks on a journey of self-discovery after uncovering his wife’s infidelity. He travels to South America where he discovers that lithium mining companies are contaminating water sources and land, affecting the health of the people and environment. Fabrizio also discovers that mining companies actively bribe government officials to obtain mining permits and use violence to silence local communities’ opposition towards the mines. The film is available on Prime Video.

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