Supply Chain is a Green Choke Point

19 Nov 2021, Posted in All Posts, Blog Posts

Green energy technologies like solar panels, wind turbines, and batteries help facilitate emissions-free energy to the U.S. power grid. While the promise of greenhouse gas (GHG) reduction directs attention to these technologies, the inputs required to build them do not receive as much recognition. With the current supply chain crisis gripping the U.S., crucial components for renewable energy technology have become scarce as many of them are mined, refined, or manufactured overseas.  

Perhaps the best lesson learned from the ongoing supply chain crisis is that many of the “zero-emission” energy technologies require extraction and mining, refining, transporting, and manufacturing well before they begin to offset any carbon emissions. In fact, the U.S. is currently 100 percent dependent on imports for 17 different key minerals for green technology. For another 29 key minerals, the U.S. imports half of its domestic needs. 

Importing these materials adds significant emissions to these materials’ total lifecycle emissions. Even with cutting-edge green manufacturing (using materials or industrial processes that reduce GHGs or recycle them), getting solar or wind components to the U.S. can lead to even larger increases in shipping emissions. As supply chain problems persist, shipping companies have increased their supply of sulfur and bunker fuel supply and maximum speeds to meet demand, leading to a massive spike in emissions worldwide.  

The ongoing transportation glut is only part of the problem. The actual mining of these green components outside the U.S. is subject to weaker environmental protection, safety regulations, and worker protections, and remains at the whim of other nations that can reduce and pressure supply. For example, the rare earth metal neodymium comes from almost exclusively mines in China and is a crucial component in wind turbines. In the mining city of Baotou, waste from neodymium mining has created a radioactive lake, on top of massive amounts of GHGs from surrounding coal plants where it is processed.  

In addition to fewer and less regulated environmental and safety rules for extracting these materials, the machinery, plants, and transportation mechanisms to obtain, refine, or ship these materials rely more heavily on coal, diesel, and other fossil fuels. These emissions are baked into the lifecycle emissions from these renewable energy technologies.

Developing countries also consume more of their own critical resources to manufacture green technology for countries that have the capital and infrastructure already in place to meet their own green energy needs. The demand for lithium has caused many farmers in Chile’s salt flats to compete directly with mining ventures for access to water in what is already one of the world’s driest regions. Further depleting the area’s groundwater in an already arid environment can have wide-reaching effects both for the people that live there and the wider regional climate. Similarly, mining for cobalt mostly takes place in the Democratic Republic of Congo, where it is estimated that upwards of 40,000 children work in dangerous conditions to extract the mineral. Finally, graphite mines in Brazil, Turkey, and China result in thousands of fine particles being blown into the atmosphere, causing respiratory illnesses for nearby populations. 

In the U.S., we have strong environmental, labor, and emission-mitigating regulations and technology to reduce these potential hazards. Given the current supply chain crisis, materials are more expensive and inflation is adding to the costs of green energy. Regulations stipulate how many and what type of pollutants are acceptable in our food, water, air, and products and the Environmental Protection Agency has the strategic planning and resources to reduce pollution and environmental impact from heavy industry. Obtaining green technology components from overseas is not green, is expensive, and leaves room for other actors to impact the U.S.’s renewable energy transition 

Ultimately, manufacturing green technology is not carbon free. However, by mining, refining, and producing green technology in the U.S., the government, and businesses can have greater control over their supply chains, hold the industry to U.S. environmental standards, and implement programs like carbon offsets to further reduce the carbon footprint of green technology manufacturing. Accounting for the entire lifecycle of green technology will allow the industry, environment, and government to have greater control over the U.S.’s renewable energy transition.  


Written by Roy Mathews, Public Policy Associate


The Alliance for Innovation and Infrastructure (Aii) is an independent, national research and educational organization. An innovative think tank, Aii explores the intersection of economics, law, and public policy in the areas of climate, damage prevention, energy, infrastructure, innovation, technology, and transportation.