Decarbonization is expected to have a profound impact on the global economy over the next thirty years.

The Paris Accord in 2015 set the goal of achieving a climate-neutral society by 2050, in order to limit rising global temperatures from man-made CO2 emissions. Implementation got off to a slow start after Donald Trump withdrew the US in 2017 but regained impetus when the US rejoined at the start of 2021, on Joe Biden’s first day in office.

Carbon Emissions by Industry

Current carbon emissions by industry

While some trends are already well-established, others rely on new or unproven technologies and may offer some surprising twists in the road ahead.

Power generation

  • Renewables, in the form of wind and solar power, are already well underway but there are concerns regarding reliability.
  • Nuclear was dead-and-buried — with Germany agreeing to phase out nuclear power and France agreeing scale back reliance — but reliability issues with renewables may lead to a resurgence.


  • Electric vehicles powered by lithium-ion batteries are gaining widespread adoption by motor manufacturers but battery life, range and charging times still present obstacles for commercial applications.
    • EV charging is also expected to increase the load on power generation infrastructure.
    • Shortages of lithium are driving up prices which could undermine manufacturers’ efforts to reduce EV battery costs.
  • Hydrogen is widely touted as the fuel of the future but the technology is still a long way behind, with massive reductions in production costs needed for green hydrogen to be economically viable.
    • The most likely source of green hydrogen is from electrolyzers powered by electricity, increasing demand for power generation. Hydrogen fuel cells are also prohibitively expensive and have been abandoned by some commercial truck manufacturers.
    • Hydrogen may still prove viable for rail outside of major cities — because of the cost of electrification — and both shipping and air travel due to the lack of alternatives.

Heavy industry

  • Every ton of steel produced in 2018 emitted on average 1.85 tons of carbon dioxide, equating to about 8 percent of global CO2 emissions, according to the World Steel Association. Blast furnaces use coking coal to smelt iron ore into pig iron.
    • Electric arc furnaces, with far lower carbon emissions, are used for recycling but there is insufficient supply of scrap steel to satisfy demand.
    • Andrew Forrest at Fortescue Metals is leading the push to smelt steel using green hydrogen but plans are still unproven, with no pilot plants yet in operation.
  • Cement production accounts for another 5% of global carbon emissions. It takes roughly a ton of coal to make a ton of cement. Limestone also emits CO2 when heated, almost doubling the emissions from coal. About 40% reduction can be achieved through new technologies but there are no ready substitutes for cement and concrete.


  • Mining presents additional challenges because of remote locations and may be more suited to hydrogen and possibly small modular nuclear reactors (SMRs) to power large mines.

Target industries

Some industries still face a high degree of uncertainty because of untested technologies, new developments, and political obstacles in the case of nuclear:

  • Nuclear energy
  • Uranium
  • Green hydrogen

Other trends are already well-established:

Electric vehicles (EVs)

China and Europe have led the adoption of electric vehicles. China scaled back EV subsidies in 2019 (USGS 2020) but is still the biggest market.
EV Sales by Region
Adoption in the EU continues to climb, however, with a 2020 European Commission study projecting an increase in the EV fleet from 10 million in 2020 to 40 million by 2030 and 210 million by 2050 according to their mid-range (MDS) projections.

EU: EV Fleet Projections
Consultants Wood McKenzie forecast that global EV sales will exceed 20 million by 2033, reaching 40 million by 2040.

EV sales
Consumer preferences are shifting rapidly. In a November 2020 survey by Ernst & Young among both current car owners and non-car owners, 30% said they’d prefer a non-ICE vehicle for their next purchase, leading EY to predict:

“……by 2028 EV sales in Europe will surpass those of other powertrains, a trend that will be repeated in China by 2033 and in the US by 2036. The analysis also shows that by 2045, non-EV sales will shrink to less than 1% of overall sales.”

Global car sales peaked in 2018 at 92 million, which would mean that EV sales would (according to EY projections) reach more than 40 million by the early 2030s.

EV Costs Falling

Falling costs of producing batteries, as scale of production increases, are likely to lower the cost of EVs and increase the appeal to consumers.

Electric cars and vans will be cheaper to produce than conventional, fossil fuel-powered vehicles by 2027….The falling cost of producing batteries for electric vehicles, combined with dedicated production lines in carmarkers’ plants, will make them cheaper to buy, on average…..even before any government subsidies, BloombergNEF found. (The Guardian)

Battery prices

ICE phase-out

The UK government plans to ban the sale of new fossil fuel vehicles from 2030, while the EU is considering calls for an end date of 2035 for sales of new internal combustion engine (ICE) vehicles.
Audi announced that they will go all-electric, with the last ICE vehicles rolling off the assembly line in 2026. That trumps Volkswagen who announced a staggered phase-out, ending sales of ICE vehicles in Europe between 2033 and 2035 but “somewhat later” in the US and China.
Jaguar plan to be all-electric by 2025, Volvo by 2030, and GM by 2035.

It is still uncertain what manufacturers will win the competition for low-priced EVs, necessary to build economies of scale, but whoever wins will need lithium-ion batteries.


Lithium carbonate, 99.5% Li2CO3 min, battery grade, spot price cif China, Japan & Korea, $/kg (midpoint).

Source: Fastmarkets – Lithium carbonate, 99.5% Li2CO3 min, battery grade,
spot price CIF China, Japan & Korea, $/kg (midpoint).

Demand is outstripping current lithium supplies and lithium miners are a key focus of ours. This includes brine assets in South America and hard rock assets in Australia and North America. Geothermal extraction is being touted as a new source of lithium but direct extraction is a difficult technology and fraught with challenges, not least of which is fouling of equipment by brine impurities.


About 75 kilograms of copper is required to manufacture one EV. Charging infrastructure will also make heavy use of copper, as will wind turbines — about 4 tons of copper is required to make a 2MW wind turbine, according to Energy Skeptic — and expansion of the electricity grid.

See Copper for more information.

Rare earth elements (REEs)

REEs such as neodymium, praseodymium and dysprosium are key ingredients in the most powerful magnet material, neodymium-iron-boron. NdFeB is used to manufacture permanent magnets for synchronous motors in EVs and synchronous generators in wind turbines.

Electricity Infrastructure

Around 150 million tons of copper are installed in power lines around the globe, according to Der Spiegel.

Reduction in carbon emissions is expected to require a doubling in the usage of electricity, most of which will be drawn from the electrical grid, whether generated by renewables, coal and gas (with carbon capture), or nuclear power. That in turn will require a doubling in electrical infrastructure; a promising outlook for the heavy electrical industry.