The U.S. military is ramping up its investment in Canadian mining with a significant new grant. On Tuesday, the Pentagon announced a $20 million U.S. grant to Electra Battery Materials Corporation to set up the cobalt refinery in Temiskaming Shores, Ontario.

Unlocking Pentagon’s Funding Push for Electra Battery Materials

Electra Battery Materials has secured the investment from the U.S. Department of Defense (DoD) under Title III of the Defense Production Act, notes the press release. 

The award uses funds from the Ukraine Supplemental Appropriations Act of 2022. It supports the 2024 National Defense Industrial Strategy goal to boost domestic production of key minerals. Over the top, in June, the Canadian government also gave Electra USD 3.6M to advance a battery materials recycling project at the same refinery.

However, this grant is part of a broader initiative launched during President Joe Biden’s 2022 visit to Ottawa. Notably, the current one is the largest of several U.S. grants for securing critical mineral supplies in Canada. The DoD further added that the Ontario Cobalt Refinery’s construction will help Electra launch North America’s first cobalt sulfate hydrometallurgical plant.

Subsequently, this plant will produce cobalt sulfate which is a crucial component for lithium-ion batteries. These large batteries will consequently, support both defense projects and the growing EV supply chain in the U.S. and Canada.

Electra’s Groundbreaking Cobalt Facility

The project features a hydrometallurgical facility with a proven track record. Notably, it is the only one in North America providing cobalt sulfate for EVs. Its modular design allows it to expand as the EV market grows. Additionally, the site is fully permitted and ready for future expansion. It also boasts 51% lesser greenhouse gas emissions compared to Chinese facilities, thanks to its hydroelectric power source. Ultimately, at full capacity, it could produce enough cobalt sulfate for over 1 million EVs annually.

The company also manages its emissions effectively, we can estimate this in the table acquired from its sustainability report.

source: Electra Battery Metals

SEE MORE: Cobalt Crunch: Prices Plummet, Supply Challenges Loom in the Race to Net Zero

What’s Driving this Cobalt Investment?

Media pundits have analyzed the investment from a different angle. They have explained that these investments reflect the growing concerns about reliance on China for essential minerals needed for EVs, electronics, and most importantly weapons systems.

Furthermore, with tensions over Taiwan, the U.S. seeks to diversify its supply chain and enhance its national security.

The first two grants earlier this year targeted copper, gold, graphite, and cobalt projects in Quebec and the Northwest Territories, totaling under $15 million. These earlier grants had no repayment obligations or commitments to sell minerals exclusively to the U.S. military. However, in times of crisis, Canadian law allows Ottawa to prioritize raw material sales to NATO allies.

Dr. Laura Taylor-Kale, Assistant Secretary of Defense for Industrial Base Policy, said,

“This award will develop North American production of a key precursor material for large capacity batteries, helping to create a more robust industrial base capable of meeting growing demand across both the defense and commercial sectors.”

Canada’s Critical-Mineral Wealth

Global demand for critical minerals is set to rise sharply. IEA predicts a 6X increase in the energy sector’s needs by 2040. Notably, the North American zero-emission vehicle market alone has the potential to hit $174 billion by 2030, as reported by Cananda’s Critical Mineral Strategy. Moreover, Canada is a key player in cobalt, graphite, lithium, and nickel—essential for future batteries and electric vehicles.

Therefore, investing in these minerals is crucial for a green energy transition in Canada and worldwide. This investment builds a sustainable industrial base, supporting emission-reducing supply chains and climate change solutions for future generations.

A Clean Energy Canada report suggests that a Canadian battery supply chain could contribute $5.7 billion to $24 billion to GDP by 2030.

Jonathan Wilkinson, Minister of Energy and Natural Resources Canada has given a long statement in the press release. He remarked,

“From mining responsibly sourced critical minerals, to processing them here in North America, to building batteries for electric vehicles and other key technologies, and eventually to recycling them, there is enormous opportunity for both Canada and the United States from both an economic and a security perspective. Through our continued work with the United States, driven by the Energy Transformation Task Force and the Joint Action Plan on Critical Minerals Collaboration, and other allies, we are developing secure critical minerals value chains that will create good jobs in places like Temiskaming, Ontario and beyond, and will power prosperous economies and a future that works for everyone.”

Overall, the US DoD’s investment would give a significant boost to cobalt production in Canada. With Electra Battery Materials as partner, we expect impressive results in the coming years.

FURTHER READING: Global Lithium and Battery Trends: Top Stories You Need to Know!

The post Canada’s Cobalt Cache: Pentagon Invests US$20 Million on Electra Battery Materials appeared first on Carbon Credits.

Notably, Q2 2024 marked the second consecutive quarter without any new unicorns (private companies reaching valuations of $1 billion or more) in the climate tech space. This absence of new unicorns coincides with the decline in late-stage deal sizes, further emphasizing the current caution among investors. 

The overall decline in climate tech funding and the shift towards smaller deals reflect broader trends in the market, where investors are becoming more selective and cautious in their approach. Venture capital (VC) remains the largest group (25%) investing in the industry quarterly since 2020. 

Here are the top four venture capital climate companies according to the CB Insights Report, which are worth noting in boosting green technologies that help in the fight against climate change.

SOSV: The Accelerator Driving Deep Tech and Planetary Health

Location: United States

SOSV is a global venture capital firm known for investing in early-stage deep tech startups with a focus on human and planetary health. Founded in 1995 by Sean O’Sullivan, SOSV has grown its assets under management to over $1.5 billion, supporting more than 500 startups worldwide. The firm operates several accelerator programs, including IndieBio and HAX, which provide startups with access to laboratories, office spaces, and mentorship.

Through these programs, SOSV has backed over 1,000 startups across various sectors, including health, food, and sustainability.

SOSV is deeply committed to environmental sustainability. The firm has made significant strides in supporting companies that are working to reduce carbon emissions and address climate change. For instance, it has invested in companies developing alternative proteins, carbon capture technologies, and other solutions aimed at reducing the carbon footprint of industries. SOSV’s portfolio companies have collectively raised billions in follow-on funding, and several have achieved unicorn status.

Image from Medium.com

The VC firm created the “Climate Tech 100”, which highlights top climate-focused startups from SOSV’s portfolio. The 2024 edition features 30 new companies, with an aggregate valuation of $11.1 billion and $3.68 billion raised in total, including $151 million from SOSV itself.

SOSV 2024 Climate Tech 100 Portfolio

SOSV’s commitment and leadership in climate tech investment have been recognized by PitchBook, which ranks SOSV as the most active investor in climate tech, agtech, and carbon emissions technology since 2018.

Sean O’Sullivan, the Managing General Partner of SOSV, emphasizes that despite the recent downturn in climate tech funding, the sector is poised for a resurgence driven by critical global needs and favorable trends in industrial sustainability and reshoring U.S. production capabilities.

The investor is also increasingly focusing on critical minerals, recognizing their essential role in the renewable energy transition. The firm invests across the entire critical minerals value chain, from exploration to extraction and processing. These minerals are vital for the production of batteries, electric vehicles, and other clean energy technologies, making their sustainable sourcing a key priority for SOSV.

Global Brain: Fostering Global Innovation for a Greener Tomorrow

Location: Japan

Global Brain is a leading venture capital firm with a mission to foster innovation by investing in startups worldwide since 1998. With over $1.9 billion in assets under management, Global Brain has backed more than 1,000 startups, covering industries such as technology, sustainability, and critical minerals. 

The firm is particularly focused on supporting the transition to renewable energy, investing in companies that work on eco-friendly technologies and the sustainable sourcing of critical minerals essential for the clean energy sector.

Global Brain Climate Tech Portfolio Companies

Global Brain operates globally, with a presence in key innovation hubs like Tokyo, Silicon Valley, and London. The firm collaborates closely with large corporations through its corporate partnership programs, facilitating open innovation and helping startups scale more effectively. This collaboration has enabled Global Brain to drive advancements in critical industries, including the sourcing and processing of critical minerals crucial for renewable energy technologies such as batteries and electric vehicles.

The firm’s notable investments include companies Orbital Marine Power, known for its pioneering tidal energy technology that promises to generate clean, renewable energy from ocean currents.

Global Brain has also played a significant role in expanding its portfolio internationally. The firm’s global reach includes investments in high-growth markets such as the U.S., Europe, and Southeast Asia, contributing to its robust track record of successful exits and partnerships.

Global Brain investment by region

Global Brain is actively involved in supporting technologies that contribute to sustainability and carbon footprint reduction. The firm invests in startups that focus on renewable energy, energy efficiency, and environmental conservation. For example, their investment in TerraCycle, a company dedicated to recycling hard-to-recycle waste, reflects their commitment to tackling environmental challenges and promoting a circular economy.

Lowercarbon Capital: Fast-Tracking the Low-Carbon Revolution

Location: United States

Lowercarbon Capital is a prominent venture capital firm dedicated to accelerating the transition to a low-carbon economy. Founded by Chris Sacca and his team, the firm focuses on investing in innovative technologies and business models that address the climate crisis and reduce global carbon emissions.

Their portfolio includes startups pioneering innovations like zero-carbon cement, methane reduction in computing, fully electric planes, and advanced carbon removal technologies. Lowercarbon Capital is committed to supporting scalable solutions that can significantly reverse climate change while also delivering strong financial returns. This top VC company focuses on these three main areas:

Since its inception, Lowercarbon Capital has raised over $1 billion to invest in breakthrough climate technologies. The firm’s portfolio includes pioneering companies in sectors such as carbon capture, renewable energy, and sustainable agriculture. Notable investments include companies like Charm Industrial, which is developing direct air capture and bioenergy with carbon capture and storage (BECCS) technologies with the potential to sequester millions of tons of CO2 annually.

Another key investment is in Nori, a platform focused on carbon removal through regenerative agriculture, aiming to sequester 10 million tons of CO2 per year.

Lowercarbon Capital’s strategic approach includes both early-stage and growth-stage investments. The firm’s support has been instrumental in scaling technologies that have the potential to achieve significant emissions reductions. For instance, Lowercarbon Capital has helped fund innovations that could potentially reduce global carbon emissions by up to 5% over the next decade.

The firm’s investment strategy is centered on high-impact climate solutions with a focus on scalability and effectiveness. Lowercarbon Capital targets technologies with the potential to cut carbon emissions across various industries, including energy, transportation, and agriculture. Their portfolio features technologies that aim to reduce carbon footprints by capturing and storing CO2, enhancing renewable energy integration, and promoting sustainable practices, which are crucial for achieving net-zero goals.

Breakthrough Energy Ventures: Billion-Dollar Bets on Net-Zero Technologies

Location: United States

Breakthrough Energy, founded by Bill Gates and a coalition of influential investors, is at the forefront of advancing technologies aimed at reducing global carbon emissions. The firm is dedicated to funding and scaling innovations that drive sustainable development and address climate change.

Breakthrough Energy Ventures (BEV), the firm’s investment arm, has invested over $2 billion in more than 60 high-impact startups. BEV has committed over $3.5 billion in capital to support more than 110 innovative companies, spanning from seed to growth stages.

Key investments include QuantumScape, which has developed a solid-state battery with the potential to increase energy density by 50% compared to conventional lithium-ion batteries, and Twelve, a company turning CO2 into valuable chemicals with a goal to reduce emissions by up to 50 million tons annually.

BEV’s investment strategy is guided by its focus on the Grand Challenges, which aim to:

Develop Scalable Climate Solutions,
Attract Additional Investment, and
Address Critical Gaps in Climate Technology.

Breakthrough Energy Catalyst, another arm of the organization, supports large-scale projects with an investment goal of $15 billion to accelerate the commercialization of clean technologies. Catalyst projects include direct air capture systems and advanced hydrogen electrolyzers, with the potential to remove up to 1 billion tons of CO2 from the atmosphere annually by 2030.

Breakthrough Energy’s portfolio emphasizes substantial carbon footprint reduction. Investments target areas with significant impact potential, such as energy storage and low-carbon fuels. Through strategic partnerships and collaborative efforts, Breakthrough Energy is driving systemic change and working towards a net-zero future.

Climate tech funding experienced a downturn in Q2 2024, with investor caution leading to fewer large deals and no new unicorns. Despite the decline, early-stage opportunities remain promising.

Top venture capital climate companies like SOSV, Global Brain, Lowercarbon Capital, and Breakthrough Energy Ventures continue to invest in innovative technologies that could shape the future of climate solutions. These firms are pivotal in driving progress towards a low-carbon economy through strategic investments and global partnerships.

The post The Top 4 Venture Capital Climate Companies: How Are They Shaping the Green Future? appeared first on Carbon Credits.

The debate over U.S. tariff policies on critical minerals from China is gaining attention as the country approaches its November presidential election. Both major candidates—Vice President Kamala Harris and former President Donald Trump—are likely to continue using tariffs as a tool in the ongoing trade tensions with China. 

However, their approaches differ significantly, with each reflecting distinct strategies toward energy transition, industrial policy, and U.S.-China relations.

How Harris and Trump Plan to Use Tariffs in the Energy Race

Under the Biden administration, Section 301 tariffs were imposed on a range of Chinese products, including key components vital to the energy transition. These components, such as lithium-ion batteries and natural graphite, are essential for technologies like electric vehicles and renewable energy storage. These tariffs, which were increased in May 2024, include a 100% tariff on electric vehicles (EVs) and a 25% tariff on critical minerals, excluding lithium. 

This strategy is part of a broader effort to reduce U.S. reliance on Chinese imports for critical minerals essential to the energy transition, especially those used in EVs and renewable energy technologies.

SEE MORE: U.S. Raises Tariffs on $8B China Imports: EVs, Batteries, and Solar Cells Included

Harris’ Approach

Kamala Harris has been a strong supporter of the Biden administration’s climate policies, including the Inflation Reduction Act. The law provides incentives for domestic production and “friendshoring” of critical minerals supply chains. 

If elected, Harris is expected to maintain the current administration’s approach, using tariffs strategically to further climate goals. This would likely involve continuing to impose targeted tariffs on specific products that are crucial for the energy transition, thereby encouraging domestic production and reducing dependency on China.

Harris’s potential administration would likely view tariffs as a tool to promote sustainable development and achieve climate objectives, particularly in aligning with international commitments such as the Paris Agreement. By focusing on specific products, her administration could aim to balance the need for critical minerals with the overarching goal of decarbonizing the U.S. economy. This approach is seen by policy experts as a continuation of Biden’s policies, which have been designed to create a level playing field for domestic producers while advancing the country’s climate goals.

Trump’s Approach

In contrast, Donald Trump has indicated that if he were to return to office, his administration would adopt a more aggressive and sweeping approach to tariffs. Trump has previously expressed support for a 60% or higher tariff on all goods imported from China, along with a 10% tariff on all U.S. imports. This broad approach reflects Trump’s longstanding skepticism of trade with China and his administration’s focus on protecting U.S. industries from foreign competition.

A Trump administration would likely implement broad tariffs across a wide range of products, including critical minerals, without the targeted focus seen in the current administration, according to Scot Anderson, energy and natural resources metals and mining subsector head at Womble Bond Dickinson.

Responding on this, Vice President Harris remarked during a speech that Trump’s tariffs:

“…will mean higher prices on just about every one of your daily needs: a Trump tax on gas, a Trump tax on food, a Trump tax on clothing, a Trump tax on over-the-counter medication.”

For policy experts, this would likely result in higher tariffs on all critical minerals imported from China, regardless of their role in the energy transition. Such a policy could be seen as part of a broader strategy to reduce the U.S. trade deficit with China and protect domestic industries. 

Can U.S. Producers Thrive Under New Tariff Policies?

The continuation or strengthening of critical minerals tariffs under either administration could provide some benefits to U.S. producers. 

Companies like Pure Lithium Corp., a Massachusetts-based lithium company, view tariffs as beneficial for attracting investors and promoting domestic production. Tariffs can create market certainty, which is crucial for companies looking to scale up operations in the U.S.

The potential differences in tariff policy between Harris and Trump highlight the broader debate over how the U.S. should approach trade and industrial policy in the context of the energy transition.

Harris’s continuation of targeted tariffs would likely focus on achieving climate goals and reducing dependency on China for critical minerals. On the other hand, Trump’s broad tariffs could prioritize protecting U.S. industries but at the risk of higher costs for clean energy technologies.

The U.S.-China Tug-of-War for Critical Mineral Dominance

As the presidential election approaches, the competition to secure critical minerals essential for clean energy production is intensifying. Regardless of whether Donald Trump or Kamala Harris emerges victorious, the next administration will need to focus on strengthening the U.S.’s position in the global race for these vital resources.

Chart from Bloomberg

Africa holds more than a 5th of the world’s reserves of crucial minerals like cobalt, copper, nickel, and lithium. However, China has established a more significant presence in Africa, with more operational mines on the continent than the U.S., making America vulnerable to potential supply disruptions and price surges in these critical inputs.

To counter China’s dominance in Africa’s critical mineral space, the U.S. will need to develop strategic partnerships and trade agreements with African nations. One key initiative in this effort is the African Growth and Opportunity Act (AGOA), a flagship U.S. program that provides nearly 40 sub-Saharan African nations with duty-free access to the American market. 

African trade ministers have called for a swift renewal of the AGOA deal, urging that it be extended for at least 16 years with minimal changes to stabilize commerce, promote investment, and preserve regional value chains. The U.S. has a significant opportunity to close the gap with China, especially as greenfield foreign-direct investment into Africa’s extractive industries declines.

As the U.S. moves toward the 2024 election, the future of tariff policy on critical minerals remains a key issue. Both Harris and Trump are likely to use tariffs as a tool to address trade imbalances with China, but their differing approaches reflect broader visions for the U.S. economy and its role in the global energy transition.

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Fortescue has launched its Green Metal Project in Pilbara, Western Australia. This US$50 million initiative, situated within the Green Energy Hub at Christmas Creek, aims to produce over 1,500 tons of green metal annually. With the first output expected in 2025, this project marks a significant advancement in the green hydrogen space.

Fortescue’s Hydrogen Plant: A Step Towards Decarbonizing Mining

The iron and steel industry are extremely difficult to decarbonize, but the green mining leader is making groundbreaking efforts to reduce emissions in this sector.

Fortescue Executive Chairman Dr Andrew Forrest said,

“Today is a celebration of innovation, collaboration, and stretch targets, and marks a pivotal moment in Fortescue’s journey to build a green metal supply chain. Iron and steel are the backbone of our infrastructure; however, traditional iron and steel production processes are among the largest sources of greenhouse gas emissions.”

So, what is this green metal?

They have defined green metal as the “end product resulting from processing iron ore into iron, using renewable energy and with near zero carbon emissions.”

Dr. Forrest also elaborated that the company’s current milestone marks the integration of green mining, large-scale renewable power, and green hydrogen to produce green metal. He thinks this is a rare opportunity to create a green supply chain and Fortescue is steading fast to take advantage of it.

The company’s newly installed green hydrogen refueling station received a major boost of a $2 million grant from the Western Australian Government’s Renewable Hydrogen Fund. No wonder it is leading the green revolution, having enormous green hydrogen capacity.

Notably, this plant can produce up to 530 kg of H2 gas daily, equating to 195 tons annually. It is partly powered by solar energy and can serve a fleet of 10 hydrogen-powered coaches. Speaking of their latest advancements, they have completed the largest combined gaseous and liquid hydrogen plant on any Australian mine site.

READ MORE: ATCO and BOC Linde to Build $376M South Australia Hydrogen Project 

The Green Energy Hub

Green hydrogen plays a crucial role in reducing mining emissions. It powers everything from buses to heavy equipment like haul trucks and excavators.

The Green Energy Hub features a hydrogen liquefaction facility, liquid hydrogen storage, and a liquid hydrogen refueling station. These are essential components in Fortescue’s broader decarbonization efforts, which also include zero-emission prototypes.

Fortescue Hydrogen Systems (FHS)

The company wants a shift from fossil fuels by using renewable energy to create cutting-edge hydrogen production systems for any application. Their portfolio includes a wide range of electrolyzer products, systems, and services, featuring advanced technologies and membrane innovations. Fortescue’s hallmark PEM Electrolyzers use a High-Pressure Proton Exchange Membrane (HP PEM) as the core technology.

For hydrogen solutions, they have FHS P50 that delivers 24,000 kg/day of high-quality, pressurized hydrogen through a modular but industrial-scale design. The other prototypes are FHS P1 and P5. They offer compact hydrogen solutions of capacity 480 to 2,400 kg/day of high-grade hydrogen.

Fortescue’s Emissions Reduction Targets and Strategy

The company is committed to achieving real zero Scope 1 and 2 emissions across its Australian iron ore operations by 2030. It is working towards having the targets verified by the SBTi for the current financial year. For Scope 3 emissions, Fortescue aims to decarbonize the steelmaking process, shipping, and upstream emissions by 2040.

source: Fortescue

Scope 1 and 2 Emissions: In FY23, Fortescue’s total gross Scope 1 and 2 emissions from Australian iron ore operations and marine vessels were 2.55 mtCO2e. Scope 1 emissions were 2.2 million tons, while Scope 2 emissions from power purchases were 0.35 million tons.
Scope 3 Emissions: Fortescue’s Scope 3 emissions reached 267.61 mtCO2e in FY23, marking a 5% increase from FY22 due to a rise in iron ore shipments.

Since FY19, its RE use in Pilbara has grown from less than 1 gigawatt hour (GWh) to 144 GWh in FY23, with a 58.9 GWh increase since FY22. Today, renewable energy accounts for 20% of the energy purchased for Pilbara operations.

The company’s climate change strategy is focused on three key areas:

Implementing in-house and collaborative solutions to reduce emissions within their iron-ore operations.
Providing technology solutions to address emissions across their value chains.
Driving the development of renewable energy and green hydrogen to support global decarbonization efforts.

source: Fortescue

Fortescue Metals Chief Executive Officer, Dino Otranto

“On decarbonization, we remain firmly committed to our target of Real Zero by 2030, without voluntary carbon offsets. Our hydrogen-powered haul truck prototype also operated on hydrogen for the first time and will soon be transported to our Christmas Creek site to undergo site-based commissioning and testing.”

Western Australia: The Green Hydrogen Hotspot

Australia leads the world in renewable hydrogen projects. We dug into a report in Hydrogen Insight and discovered that last year the Australian Government announced a subsidy of US$1.35bn to ramp up domestic green hydrogen supply.

They named it the “Hydrogen Headstart Program”. It aims to bridge the commercial gap for early-stage projects, positioning Australia as a global leader in hydrogen production and export.

Moreover, Western Australia (WA) is ideally positioned to produce, use, and export renewable hydrogen. It has abundant renewable energy resources, a robust energy industry, and proximity to major international markets. These advantages make it a top choice for hydrogen investors and companies.

Here’s a report from Australia’s National Hydrogen Strategy

source: Australia’s National Hydrogen Strategy

Western Australia’s Premier, Roger Cook, hailed the plant as a crucial step in emerging as a global leader in clean energy and green iron production. Thus, we can conclude that Fortescue’s new plant is truly revolutionary. It produces both gaseous and liquid hydrogen, that can power the company’s mining prototypes and coach fleet at Christmas Creek.

MUST READ: Woodside Energy Collaborates with Yara Pilbara to Explore CCS in Australia

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