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The automotive industry is the world’s largest consumer of many of the transition minerals required for batteries, such as cobalt and lithium, and the second-largest consumer of nickel – second only to its dominant use in stainless steel. As automakers go electric, demand for these minerals is skyrocketing. Automakers must use their outsized influence to ensure battery metals and manufacturing is fossil-free and benefits workers, Indigenous Peoples, and local communities.

Fossil-free & Environmentally Sustainable Supply Chains

Battery production is a rapidly growing industry. But the lack of rigorous, verifiable, and disaggregated information about individual battery mineral emissions is a major problem that must be tackled. Depending on the mineral, deposit, and method, producing the metals for EV batteries can be highly emissions intensive – as is the case with nickel. The majority of the greenhouse emissions come from refining these minerals.

Manufacturing battery cells is also energy intensive, and will release significant quantities of CO2 emissions where renewable energy is not used. The World Economic Forum’s base case scenario for the battery value chain places its annual emissions by 2030 at 182 metric tonnes of CO2 – more than the current annual emissions of the Netherlands. Displacing ICE vehicles and carbon-based energy production would prevent far more yearly emissions overall, but minimizing battery emissions – from mine to manufacturing – is nonetheless a critical step for automakers if they are to stay on a 1.5 degree pathway as they scale up EV production.

Without stringent environmental protections, mining and refining minerals can cause deforestation, threaten biodiversity, pollute air and waterways, and leave toxic tailings (rock waste). If automakers and other industries don’t clean up battery supply chains as the world electrifies, then environmental degradation could discredit the transition to EVs.

Automakers need to start addressing these challenges now as new regulations, such as the EU battery law, will start requiring it.

Human Rights & Responsible Sourcing

Some transition minerals are sourced in areas with – and can often fuel –armed conflict, forced labor, violence, or other risks of harm to people, otherwise known as conflict-affected or high-risk areas (CAHRAs). Additionally, it’s estimated that more than half the minerals needed to power the EV transition are located on or near the lands of Indigenous Peoples. Child labor, dangerous working conditions, Indigenous rights abuses, negative impacts on the right to a healthy environment, and worker exploitation have been exposed across battery supply chains.

As a major consumer of battery minerals, the auto industry needs to ensure responsible sourcing, extraction, and manufacturing practices. Automakers need to leverage their position to demand mandatory human rights and environmental due diligence across their supply chains, as well as respect for Indigenous Peoples’ right to Free, Prior, and Informed Consent. They should also require that the mines in their supply chains undergo independent audits by trusted third-parties such as the Initiative for Responsible Mining Assurance.

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