The study “Material Intensity in the Latin American Energy Transition: Estimates Based on a South American Energy Integration Scenario“It was carried out within the framework of the” Regional Cooperation for Sustainable Management of Mining Resources in the Andean Countries “(Minsus), executed by ECLAC in conjunction with the Deutsche Gesellschaft Für International Zusammenarbeit (GIZ) and funded by the Ministry Federal of Economic Cooperation and Development of Germany (BMZ). In the present stage of the Minsus program, among other objectives, it seeks to favor a more sustainable management of mining activity in the Andean countries from a transparent integration into the global chains of the global chains of supply and value and the incorporation of information and social and environmental safeguards in the economic analysis of the sector.
The report quantitatively analyzes and documents the mineral intensity of the current and projected electricity generation and transmission industries, particularly those of renewable energies, according to the energy transition scenarios for the Latin American countries that have been part of the simulation carried out with the PLEXOS Integrated Energy Model program, within the framework of the Energy Complementarity and Sustainable Development (ECOSUD) 2018 program for planning the optimal expansion of the installed capacity of the regional electricity sector by 2032.
By 2032, in the baseline scenario, approximately 26 GW (gigawatt) of new generation of solar photovoltaic (PV), 50 GW of wind, and 48 GW of hydroelectric, gas-fired thermoelectric, and, to a lesser degree, generation are required. geothermal and biomass. This increase in power generation capacity requires 2,268 tons of cobalt, 400 thousand tons of copper, 2,538 tons of lithium and 54,688 tons of nickel. In the connected renewable energy (CORE) scenario, which takes advantage of the complementarity of the region’s resources, the solar PV and wind generation installation is 47 GW and 75 GW, respectively. This increase in capacity of both technologies projects a demand for target materials of: 2,541 tons of cobalt, 611 thousand tons of copper, 2,122 tons of lithium and 53,287 tons of nickel. The additional benefit of complementarity is observed, reflected in the CORE scenario by intra-regional connection, given that, although the share of renewable energies is increased (80% of generation from renewable sources), the demand for target materials is similar, with the except for copper. This is justified because the vast current water resources are better complemented by the seasonality and location of renewable sources.
The study shows that minerals play a fundamental role in achieving global climate change mitigation goals and targets. The success of the low-carbon energy transition will depend, to a large extent, on the availability and supply of minerals, which, in turn, will encourage greater extractive activity with heterogeneous effects in the region. South America produces three of the four strategic minerals for the energy transition and electromobility: lithium, copper and nickel. Chile is the first world producer of copper (40%) and the second of lithium. Peru and Argentina also have a significant share in the world production of these minerals.
Knowing the intensity of use of minerals in the energy transition processes in the region and the world allows us to measure the strategic importance of mining activity, which, in order to minimize the negative effects that may occur during the exploitation of mining resources, requires that these are managed in a sustainable manner. In this way, it can contribute to greater sustainability both in terms of global warming and in terms of the mineral extractive industry.
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