Skyrocketing rare earth element (REE) prices in 2010 left companies wondering whether and they would be affected – a question I have been trying to answer, first through my Ph.D. research and now, as a postdoctoral associate at the Materials Systems Laboratory at MIT. As part of an ongoing project with Ford Motor Company, my colleagues (from Ford and MIT) and I have been examining critical materials, in particular rare earth elements. Also covered by The Economist, we recently published our findings on future implications of global vehicle electrification and adoption of wind power for rare earth availability – based on modeling two scenarios with the following assumptions:
“Moderate demand” scenario
• 27-35% of vehicles sold in 2035 electric
• no use of rare earth permanent magnet technology in wind power technology
“Aggressive rare earth demand” scenario
(rare earth requirements for reaching stabilization of greenhouse gas levels at 450 ppm)
• 80% of vehicles sold in 2035 electric
• rare earths used in electric cars and wind turbines
We found that mineable reserves are not expected to be constraining in next 25 years under either scenario. Calculating the rate of growth of rare earth demand for these scenarios we determined that two REEs, neodymium and dysprosium would experience particularly rapid growth rates of 8% and 14%, respectively, for the “aggressive demand” scenario. For dysprosium, this rate is about 3x greater than the historical supply growth rate.
What does this mean for rare earth end-users? My research has shown that rapid demand growth may be mitigated by technological actions such as materials substitution, improved efficiency, and increased recycling – options that are already reportedly being researched by end-users motivated by high rare earth prices.