The Biden administration has pushed for more electric cars, which require more lithium for batteries. Since most of our current lithium comes from China, the US invested money in a project to extract lithium from underground saltwater deposits. Unfortunately, the promise of the idea was more than reality could handle.
Most of us don’t know a whole lot about lithium. Maybe you remember the Nirvana song by that name, and the “I’m not gonna crack” refrain. Maybe you recognize it as a treatment for bipolar disorder. Maybe you remember from chemistry class that it’s a chemical element with the symbol Li and atomic number 3. It is a soft, silvery-white alkali metal. Under standard conditions, it is the least dense metal and the least dense solid element. It’s highly reactive, and so is almost exclusively found in compound minerals.
Since the mid 1990’s, lithium has found use in batteries. Demand roughly doubled between 2012 and 2020 with the rise of hybrid cars and lithium-ion batteries for mobile devices. Although demand for lithium has been growing at roughly 25% per year, lithium production has only grown at 4-5% per year. The Covid 19 shutdowns highlighted supply chain problems around the world, and lithium was no exception. The need for made-in-America lithium was magnified to the point that the Department of Energy decided to throw some money at the problem. Berkshire Hathaway was the recipient of a 14.9 million dollar grant to study how to extract lithium hydroxide from geothermal brine deposits under the Salton Sea in California. The goal was lofty:
“We’re going to set America up to lead the world by building a clean energy economy and a clean energy future,” Biden said at a February event, which was billed as a critical minerals roundtable.
Alicia Knapp, chief executive of Berkshire’s BHE Renewables division, told Biden that Berkshire was “working to secure the most abundant source of lithium in the United States using the world’s most environmentally friendly technology.”
The folks at Berkshire worked on the problem for two whole weeks before the grant was rescinded. They started with a full charge, but quickly ran out of juice. Even with nearly 15 million on the line for the pilot project, everyone involved concluded that the project wasn’t commercially viable because the technology to extract lithium hydroxide from the brine didn’t exist. After 13 months of further negotiation, Berkshire and the DOE agreed to call the whole project off, although both continue to be involved in other lithium development efforts.
Texas has lithium deposits, and Tesla has announced an effort to mine lithium hydroxide on the Gulf Coast. However, as of last month Tesla said that it is still “evaluating the feasibility of this project” and “only very preliminary development activities have begun.” No engineering, construction or procurement construction contracts have been negotiated or signed and no regulatory permits have been obtained, Tesla reported in the announcement.
Texas is also home to the Round Top Mountain lithium and rare-earth element mine southeast of El Paso in Hudspeth County. While the project is well under way, processing is limited to the company’s facility in Colorado. The potential of Round Top Mountain has barely been tapped.
Several things about the state of the lithium industry impact Texas. First, it should be obvious that throwing money at a problem may be the Federal Government solution, but may not solve the problem. Promises to “build a green future” are simply promises by politicians. The reality is much more complicated. Next, as technology advances for stateside lithium extraction, Texas will be a key player. Our natural resources aren’t limited to oil and natural gas, and our ability to develop new technology stretches beyond hydraulic fracturing. Some people fear that Texas will somehow devolve and become a threat to the environment should we ever get free of Federal “oversight.” I tend to think the opposite, that without the Federal regulatory burden, Texas will excel in natural resource development. We’ll have oil, natural gas, and ultimately lithium.