The energy transition and the ambitious goal to globally get to net zero emissions is all leading to one place: copper.
But the reason for that is somewhat surprising. Copper, despite being rarely discussed, is critical for building out the infrastructure to support the energy transition. Whether it’s power grids, electric vehicles or solar farms, copper is required.
And the demand is starting to far outweigh the supply.
- There is growing concern that the need for copper is soon going to vastly outweigh the current supply of copper on a global scale
- The main catalyst for this is the exponential increase in copper being used for the energy transition, which is projected to increase by nearly triple
Why it matters:
- Increasing the supply of copper is not a simple task, due to the challenges and variability of mining and the lack of large scale copper mines currently in production
- Further, much of the copper globally comes from nations that are underdeveloped or politically unstable, creating further fragility for future supply
- While the answer may seem simple- increase investment in copper mining- there’s a problem. The average copper mine takes roughly two decades to go from discovery to production.
- Demand for copper is already growing today but the exponential increases are looming, with many projections showing a massive shift in demand happening within 5 years
- According to recent research from McKinsey, it’s estimated that at current copper production levels, there will be a 50M tonne shortfall of copper by 2030