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Q&A from ERG on the battery value chain

Publication: Q&A from ERG on the battery value chain
Date: 30 September 2019
Author: Stephanie Roker, Editor

Benedikt Sobotka, CEO of Eurasian Resources Group and Co-Chair of the World Economic Forum’s Global Battery Alliance, has answered some questions in relation to mining and the ‘A Vision for a Sustainable Battery Value Chain in 2030’ report from the World Economic Forum’s Global Battery Alliance.

Q. Tell us briefly about the report and its importance
The report, titled ‘A Vision for a Sustainable Battery Value Chain in 2030’, found that, with the right conditions in place, lithium-ion batteries can enable 30% of the required reductions in carbon emissions in the transport and power sectors; provide access to electricity to 600 million people for the first time; and create 10 million safe and sustainable jobs around the world.

This amounts to a tremendous socioeconomic and environmental opportunity but in order to be achieved, the report recommends that far-reaching, immediate collaboration should fall under three core areas: fostering a circular value chain; facilitating a just energy transition and economic development in line with human rights and the UN Sustainable Development Goals; and transforming the economy with a view to creating value and jobs. The World Economic Forum’s Global Battery Alliance, which I am proud to co-chair and was responsible for the report, provides a platform that can enable that collaboration, drawing in businesses, organisations, NGOs, government, civil society and academia, and support the achievement of the Paris Agreement targets and our collective, global sustainability ambitions.

Q. How is it relevant for the mining sector?
Scaling up raw material production over the next decade will come at an unprecedented pace in order to support the 19-fold growth that global battery demand is expected to register.

The mining sector therefore has a prominent role to play in unlocking this potential, be that through the responsible provision of key materials, the creation of safe and sustainable jobs and measures taken to benefit the environment and eliminate child and forced labour.

According to the report, demand for cobalt, a key metal for the electric vehicle (EV) revolution and solar panels, is expected to increase by a factor of 4 in 2030 on the basis of its use in batteries.

A similar analysis applies to other battery metals including lithium, nickel and manganese.

The growth opportunities and implications for the mining sector, which is so closely wedded to sustainable batteries, are therefore significant.

Q. How should mining businesses respond to the challenges identified in the report?
Challenges identified in the report include poor working conditions in mining and the use of forced and child labour, a practice often associated with the artisanal and small-scale sector (ASM), present in countries including Democratic Republic of the Congo (DRC), which contains over two thirds of global cobalt reserves. Continuous efforts, involving businesses, NGOs and the government, are taking place in order to establish conditions for responsible and safe production and especially the removal of child labour. More widely, mining businesses have an important role to fulfil in ensuring that key metals are produced responsibly and that safe, sustainable jobs are created. Among the 10 million jobs that are expected to be created, over half will sit within emerging economies. This is an encouraging estimate – providing safe and viable options including sustainable employment, can serve to help and ultimately eradicate child labour across the value chain.

Q. What is ERG doing to support the vision set out in the report?
As a founding member and co-chair of the Global Battery Alliance, Eurasian Resources Group undertakes a range of initiatives with a view to championing and strengthening sustainability in the mining and battery sectors. Last week, we saw the opening of a critical child protection centre in Kolwezi, DRC, part of the Bon Pasteur programme carried out by the Good Shepherd International Foundation (also a member of the Global Battery Alliance) which we are very proud to support. The elimination of child labour is at the heart of the programme which offers not only free education but also a range of services including healthcare and alternative livelihoods. The centre is set to take almost 1000 children out of mining and put them in safe, sustainable social places where they can learn about life outside of mining and gain access to more choices and opportunities.

This forms part of our wider, longstanding partnership with Global Shepherd International Foundation as a result of which over 1900 children have been protected from the worst types of child labour in 2018 and early 2019. Reflecting a similar emphasis is ERG’s support for Pact’s ‘Children out of Mining – Northern Kolwezi’ programme which will work to raise awareness of the dangers of children in mining and create apprenticeships for older children to transition out.

Inside the company, ERG is committed to sustainable development and established the ERG Clean Cobalt Framework, launched at our Metalkol RTR, in 2018. The framework consists of seven goals, including to address child labour and drive sustainability through partnerships in our own production and supply chain. The inaugural performance report of Metalkol RTR has recently been verified by independent auditors, PwC.

Technology and innovation are also areas that the Global Battery Alliance report highlights. Blockchain, for example, can also assist in strengthening trust and transparency across the value chain. This is something we are exploring and are piloting a blockchain-based solution that sits on the IBM Blockchain Platform at Metalkol RTR.