USD 23 billion per year over the next three decades needed to supply copper for zero-carbon targets

Achieving current climate targets to potentially save the world from catastrophe will require hundreds of billions in copper investments.

Who

Analysts from Wood Mackenzie claim that 9.7 million tonnes of copper are needed over the next 10 years to cover the projects necessary to hit goals outlined in the Paris Agreement targets, an increase of almost a third over current refined consumption.

Approximately 17 Mt of annual copper production is in the project pipeline, nearly double the volume required to limit warming to 1.5 °C. In reality, some of these projects have not been developed because of poor economics, and even those that can offer an attractive return on investment have other hurdles to overcome prior to development.

Eleni Joannides, Research Director at Wood Mackenzie said: “In theory, higher prices should encourage project sanctioning and more supply. However, the conditions for delivering projects are challenging, with political, social, and environmental hurdles higher than ever. For example, social and environmental licenses to operate are proving elusive in major producing countries, including Chile and Peru.”

Why it matters

Setting aside the existential issue of the survival of the planet (which probably got us into this situation in the first place), future growth in global electricity demand as economies develop will also drive growth in copper consumption. However, the use of copper for EVs and renewable power generation is significantly more intensive than in their fossil fuel equivalents. Together with the associated build-out of electrical networks, this compounds future expected demand for the metal.