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China and the United States have fired their opening salvos in a critical minerals trade war. Over the past year, China has imposed export controls on gallium, germanium, and graphite — all minerals necessary for energy transition technologies. Then in May, the Biden Administration shot back with tariffs on critical mineral imports, part of a package of trade protection measures to help shield domestic manufacturers in strategic sectors, including the mineral industry. The downstream consequence for energy transition technologies such as electric vehicle batteries, however, is almost certainly higher prices.
In all likelihood, this critical mineral trade war will intensify, with corresponding implications for U.S. industries that use these raw materials. China’s next shot may be even tighter export controls on critical minerals, including minerals for which the United States relies heavily on China. Such export controls pose real — and serious — risks to downstream U.S. industries for five key reasons.
For example, the White House assesses that U.S. consumption of rare earth elements worth $613 million affects about $496 billion in downstream economic activity across core sectors, from petroleum refining to automotive manufacturing. Critically, the United States relies on China for nearly 70% of its rare earth consumption. The United States also depends substantially on China for other minerals — more than on any other country. Of the 50 non-fuel mineral commodities for which the United States relied on imports to meet more than 50% of its consumption from 2019 to 2022, China was the leading import source for 15. Because critical minerals are necessary in applications affecting strategic sectors such as automotive manufacturing and renewable energy, Chinese export controls would be particularly disruptive and costly.
To illustrate, the United States does not produce any arsenic metal, which is used to produce gallium arsenide semiconductors for high-performance electronics. China supplied 97% of America’s arsenic metal imports in 2022. If China were to restrict arsenic metal exports to the United States, American manufacturers — including semiconductor fabricators, which the Biden administration very much wants to support — would likely struggle to find non-Chinese suppliers able to meet their full needs. Multiply this across all of the many, many minerals China supplies to the U.S., and you get a major problem.
For instance, Chinese companies have significant stakes in cobalt reserves and production in the Democratic Republic of the Congo, the world’s largest holder of cobalt reserves and producer of cobalt ore. There, the Chinese company CMOC owns the Kisanfu project, which calls itself one of the world’s “largest and highest-grade undeveloped copper-cobalt projects,” and Chinese companies owned or financed 15 of the 19 cobalt-producing mines there as of 2020. Depending on the extent to which the Chinese government requires overseas Chinese companies’ help enforcing mineral export controls, downstream U.S. industries could be prevented from sourcing minerals produced by Chinese companies outside China.
Plenty of new companies entered the rare earth industry after China reduced export quotas and caused record-high rare earth prices in 2010 and 2011. But when prices fell in 2015 due to lower-than-expected demand, many of these rare earth companies went bankrupt. Ultimately, the success rate for rare earth projects entering production between 2011 and 2021 was just 1.5%. Non-Chinese mineral producers may find it attractive to enter the market amid artificially inflated prices from export controls, but whether their business model will hold if and when prices fall again is decidedly less sure. Importantly, China’s commanding production share for many critical minerals enables it to influence global prices in its favor. If a new global industry begins to flourish, a glut of cheap Chinese minerals may not be far behind.
Mines and refineries already operating near their maximum capacity would have to invest millions or billions of dollars to expand production capacity, which can take up to five years from starting feasibility studies to commissioning new production. For mines and refineries with the capacity to ramp up production already available, that excess margin could be due to long-standing technical issues in processes like adjusting the temperature during processing. Thus, non-Chinese mineral supply may take some time — and a lot of money — to come online if China imposes export controls.
The Chinese government has both the will and the capability to impose mineral export controls — as evidenced by its prior and present use of mineral trade restrictions, from banning exports of rare earth elements to Japan in 2010 to imposing a blanket export ban on rare earth processing technology in 2023. As U.S.-China competition intensifies, more Chinese export controls on minerals could well follow, which would cause severe supply chain disruptions given challenges sourcing sufficient non-Chinese mineral supplies.
So, while it remains to be seen how China will retaliate to this new round of U.S. mineral tariffs, the U.S. government should accelerate its mineral stockpiling — including urging certain downstream U.S. industries to stockpile — and its collaboration with partner countries to improve the resilience and robustness of their mineral supply chains. The U.S. government should tread carefully in deploying trade tools in this critical minerals competition, and prepare accordingly for possible Chinese responses.
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New York City may very well be the epicenter of this particular fight.
It’s official: the Moss Landing battery fire has galvanized a gigantic pipeline of opposition to energy storage systems across the country.
As I’ve chronicled extensively throughout this year, Moss Landing was a technological outlier that used outdated battery technology. But the January incident played into existing fears and anxieties across the U.S. about the dangers of large battery fires generally, latent from years of e-scooters and cellphones ablaze from faulty lithium-ion tech. Concerned residents fighting projects in their backyards have successfully seized upon the fact that there’s no known way to quickly extinguish big fires at energy storage sites, and are winning particularly in wildfire-prone areas.
How successful was Moss Landing at enlivening opponents of energy storage? Since the California disaster six months ago, more than 6 gigawatts of BESS has received opposition from activists explicitly tying their campaigns to the incident, Heatmap Pro® researcher Charlie Clynes told me in an interview earlier this month.
Matt Eisenson of Columbia University’s Sabin Center for Climate Law agreed that there’s been a spike in opposition, telling me that we are currently seeing “more instances of opposition to battery storage than we have in past years.” And while Eisenson said he couldn’t speak to the impacts of the fire specifically on that rise, he acknowledged that the disaster set “a harmful precedent” at the same time “battery storage is becoming much more present.”
“The type of fire that occurred there is unlikely to occur with modern technology, but the Moss Landing example [now] tends to come up across the country,” Eisenson said.
Some of the fresh opposition is in rural agricultural communities such as Grundy County, Illinois, which just banned energy storage systems indefinitely “until the science is settled.” But the most crucial place to watch seems to be New York City, for two reasons: One, it’s where a lot of energy storage is being developed all at once; and two, it has a hyper-saturated media market where criticism can receive more national media attention than it would in other parts of the country.
Someone who’s felt this pressure firsthand is Nick Lombardi, senior vice president of project development for battery storage company NineDot Energy. NineDot and other battery storage developers had spent years laying the groundwork in New York City to build out the energy storage necessary for the city to meet its net-zero climate goals. More recently they’ve faced crowds of protestors against a battery storage facility in Queens, and in Staten Island endured hecklers at public meetings.
“We’ve been developing projects in New York City for a few years now, and for a long time we didn’t run into opposition to our projects or really any sort of meaningful negative coverage in the press. All of that really changed about six months ago,” Lombardi said.
The battery storage developer insists that opposition to the technology is not popular and represents a fringe group. Lombardi told me that the company has more than 50 battery storage sites in development across New York City, and only faced “durable opposition” at “three or four sites.” The company also told me it has yet to receive the kind of email complaint flood that would demonstrate widespread opposition.
This is visible in the politicians who’ve picked up the anti-BESS mantle: GOP mayoral candidate Curtis Sliwa’s become a champion for the cause, but mayor Eric Adams’ “City of Yes” campaign itself would provide for the construction of these facilities. (While Democratic mayoral nominee Zohran Mamdani has not focused on BESS, it’s quite unlikely the climate hawkish democratic socialist would try to derail these projects.)
Lombardi told me he now views Moss Landing as a “catalyst” for opposition in the NYC metro area. “Suddenly there’s national headlines about what’s happening,” he told me. “There were incidents in the past that were in the news, but Moss Landing was headline news for a while, and that combined with the fact people knew it was happening in their city combined to create a new level of awareness.”
He added that six months after the blaze, it feels like developers in the city have a better handle on the situation. “We’ve spent a lot of time in reaction to that to make sure we’re organized and making sure we’re in contact with elected officials, community officials, [and] coordinated with utilities,” Lombardi said.
And more on the biggest conflicts around renewable energy projects in Kentucky, Ohio, and Maryland.
1. St. Croix County, Wisconsin - Solar opponents in this county see themselves as the front line in the fight over Trump’s “Big Beautiful” law and its repeal of Inflation Reduction Act tax credits.
2. Barren County, Kentucky - How much wood could a Wood Duck solar farm chuck if it didn’t get approved in the first place? We may be about to find out.
3. Iberia Parish, Louisiana - Another potential proxy battle over IRA tax credits is going down in Louisiana, where residents are calling to extend a solar moratorium that is about to expire so projects can’t start construction.
4. Baltimore County, Maryland – The fight over a transmission line in Maryland could have lasting impacts for renewable energy across the country.
5. Worcester County, Maryland – Elsewhere in Maryland, the MarWin offshore wind project appears to have landed in the crosshairs of Trump’s Environmental Protection Agency.
6. Clark County, Ohio - Consider me wishing Invenergy good luck getting a new solar farm permitted in Ohio.
7. Searcy County, Arkansas - An anti-wind state legislator has gone and posted a slide deck that RWE provided to county officials, ginning up fresh uproar against potential wind development.
Talking local development moratoria with Heatmap’s own Charlie Clynes.
This week’s conversation is special: I chatted with Charlie Clynes, Heatmap Pro®’s very own in-house researcher. Charlie just released a herculean project tracking all of the nation’s county-level moratoria and restrictive ordinances attacking renewable energy. The conclusion? Essentially a fifth of the country is now either closed off to solar and wind entirely or much harder to build. I decided to chat with him about the work so you could hear about why it’s an important report you should most definitely read.
The following chat was lightly edited for clarity. Let’s dive in.
Tell me about the project you embarked on here.
Heatmap’s research team set out last June to call every county in the United States that had zoning authority, and we asked them if they’ve passed ordinances to restrict renewable energy, or if they have renewable energy projects in their communities that have been opposed. There’s specific criteria we’ve used to determine if an ordinance is restrictive, but by and large, it’s pretty easy to tell once a county sends you an ordinance if it is going to restrict development or not.
The vast majority of counties responded, and this has been a process that’s allowed us to gather an extraordinary amount of data about whether counties have been restricting wind, solar and other renewables. The topline conclusion is that restrictions are much worse than previously accounted for. I mean, 605 counties now have some type of restriction on renewable energy — setbacks that make it really hard to build wind or solar, moratoriums that outright ban wind and solar. Then there’s 182 municipality laws where counties don’t have zoning jurisdiction.
We’re seeing this pretty much everywhere throughout the country. No place is safe except for states who put in laws preventing jurisdictions from passing restrictions — and even then, renewable energy companies are facing uphill battles in getting to a point in the process where the state will step in and overrule a county restriction. It’s bad.
Getting into the nitty-gritty, what has changed in the past few years? We’ve known these numbers were increasing, but what do you think accounts for the status we’re in now?
One is we’re seeing a high number of renewables coming into communities. But I think attitudes started changing too, especially in places that have been fairly saturated with renewable energy like Virginia, where solar’s been a presence for more than a decade now. There have been enough projects where people have bad experiences that color their opinion of the industry as a whole.
There’s also a few narratives that have taken shape. One is this idea solar is eating up prime farmland, or that it’ll erode the rural character of that area. Another big one is the environment, especially with wind on bird deaths, even though the number of birds killed by wind sounds big until you compare it to other sources.
There are so many developers and so many projects in so many places of the world that there are examples where either something goes wrong with a project or a developer doesn’t follow best practices. I think those have a lot more staying power in the public perception of renewable energy than the many successful projects that go without a hiccup and don’t bother people.
Are people saying no outright to renewable energy? Or is this saying yes with some form of reasonable restrictions?
It depends on where you look and how much solar there is in a community.
One thing I’ve seen in Virginia, for example, is counties setting caps on the total acreage solar can occupy, and those will be only 20 acres above the solar already built, so it’s effectively blocking solar. In places that are more sparsely populated, you tend to see restrictive setbacks that have the effect of outright banning wind — mile-long setbacks are often insurmountable for developers. Or there’ll be regulations to constrict the scale of a project quite a bit but don’t ban the technologies outright.
What in your research gives you hope?
States that have administrations determined to build out renewables have started to override these local restrictions: Michigan, Illinois, Washington, California, a few others. This is almost certainly going to have an impact.
I think the other thing is there are places in red states that have had very good experiences with renewable energy by and large. Texas, despite having the most wind generation in the nation, has not seen nearly as much opposition to wind, solar, and battery storage. It’s owing to the fact people in Texas generally are inclined to support energy projects in general and have seen wind and solar bring money into these small communities that otherwise wouldn’t get a lot of attention.