What is a Critical Material?

Thomas E. Graedel

Yale University

May 22, 2012

Center for Industrial Ecology Yale School of Forestry & Environmental Studies

RE

PGM

Ge Nb

W

The European Commission Criticality Assessment, 2010

Random Results in Criticality Assessment EC IDA IW NEDO NRC Oakd.

Hollins South Korea

Cu No No Maybe -- No No --

As -- -- -- -- -- No --

Se -- -- Yes No -- No

Ag No No Maybe -- -- No --

Te No No -- No -- Yes No

Au -- -- Maybe

-- -- No --

The Yale Approach

to Criticality

High

Low

Low High Supply Risk

Impa

ct o

f Sup

ply

Res

tric

tion

The Criticality Matrix and the “Region of Danger”

Region of Danger

The Three-Axis Criticality Evaluation Concept

T. Graedel et al., Env. Sci. Technol., 46, 1063-1070, 2012.

VSR

I S

RI PT SP SA ERCS

AI

PR

SR

GTE S&R GP

DT CF PPI HDI WGI-PV GSC

Supply Risk

Vuln

erab

ility

to S

uppl

y R

estr

icti

on

HH ES

EI

Elements to be Analyzed in the Criticality Project

Supply Risk Axis – Corporate and National Components

Supp

ly R

isk

M

ediu

m-te

rm

Policy Potential Index ½

Social and Regulatory ⅓ Human Development Index

(adjusted for Pop. density)

½

Geological, Technological, and

Economic ⅓

Companion Metal Fraction ½

Depletion Time (with Reserves) ½

Geopolitical ⅓

Worldwide Governance

Indicators: Political Stability

½

Global Supply Concentration ½

Weight Weight

Politically unstable nations pose a higher risk of supply restriction

20 40 50 30 60 80 90 100 70 10 0

Transformed Score Scale

2008 Worldwide Governance Indicators – Political Stability & Absence of Violence/Terrorism

World Bank – WGI

Measures perceptions of the likelihood that a government will be destabilized or overthrown by unconstitutional or violent means

Encompasses social, economic, and political factors associated with underlying vulnerability and economic distress

Environmental Impact

• Evaluates the potential environmental impact of using a metal in modern society

• Based on Ecoinvent database, ReCiPe (H) Endpoint impact methodology (world average normalization)

• Using the following impact category only: - Ecosystems

• Result is a single score for a cradle-to-gate environmental impact assessment

Vulnerability – Corporate Level Vu

lner

abili

ty to

Sup

ply

Res

tric

tion

Cor

pora

te

Importance ⅓

Percent of Revenue Impacted ⅓

Ability to Pass-through Cost Increases

Importance to Corporate Strategy

Substitutability ⅓

Substitute Performance

Substitute Availability

Environmental Impact Ratio

Net Import Reliance Ratio

Components Indicators

Weight Weight

⅓

⅓

Corporate Innovation

Net Import Reliance ½ Susceptibility ⅓

Price Ratio

½

A Sampling of

Criticality Results

Copper Family Criticality - US

Cu

Te

Se

Au

As

Ag

Mean

EI

N. N

assa

r et a

l., E

nv. S

ci. T

echn

ol.,

46, 1

071-

1078

, 201

2

Copper Family Criticality - Global

Cu

Te

Se

Au

As

Ag

Mean

EI

N. N

assa

r et a

l., E

nv. S

ci. T

echn

ol.,

46, 1

071-

1078

, 201

2

A Criticality Analysis for Tin

World Leading Countries in Tin Production

Country Mine production (tonnes)

% of global total

China 115,000 44

Indonesia 60,000 23

Peru 38,000 15

Bolivia 16,000 6

Brazil 12,000 5

Total 261,000 100

Tin Criticality : Generic Methodology

0 20 40 60 80 100 0

50

100

0

20

40

60

80

100

EI

SR

VS

R

Indicator Values

(utilizes generic substitutes for tin uses)

Geological, Technological, and

Economic Social & Regulatory Geopolitical

SRM

SRM alternative weighting* DTM CF GTEM PPI HDI S&R WGI GSC GP

91 0 46 Tin

mining 60

Tin smelting

65 63 Tin

mining 76 Tin mining 76 76 62 87

Supply Risk Vulnera- bility to Supply Restriction

Importance Substitutability Susceptibility VSRC

RI PT CS I SP SAM ER IRR PR S IR CI SU

87.50 62.50 87.50 79.17 43.75 42.23 12.05 62.50 7.00 32.26 100.00 62.5 81.3 59.2

Indicator Values

(assumes no suitable substitutes exist for tin uses)

Geological, Technological, and

Economic Social & Regulatory Geopolitical

SRM

SRM alternative weighting* DTM CF GTEM PPI HDI S&R WGI GSC GP

91 0 46 Tin

mining 60

Tin smelting

65 63 Tin

mining 76 Tin mining 76 76 62 87

Importance Substitutability Susceptibility VSRC

RI PT CS I SP SAM ER IRR PR S IR CI SU

87.50 62.50 87.50 79.17 100.00 100.00 100.00 100.00 100.00 100.00 100.0 62.5 81.3 85.8

Supply Risk Vulnera- bility to Supply Restriction

Tin Criticality as a Function of Substitutability

0 20 40 60 80 100 0

50

100

0

20

40

60

80

100

EI

SR

VS

R

Red: generic substitutes; blue: no suitable substitutes

Supply Risk Axis – Corporate and National Components

Supp

ly R

isk

M

ediu

m-te

rm

Policy Potential Index ½

Social and Regulatory 1/6⅓

Human Development Index

(adjusted for Pop. density)

½

Geological, Technological, and

Economic 2/3⅓ Companion Metal

Fraction ½

Depletion Time (with Reserves) ½

Geopolitical 1/6⅓

Worldwide Governance

Indicators: Political Stability

½

Global Supply Concentration ½

Weight Weight

Tin Criticality – Alternative Weighting of Supply Risk Components

0 20 40 60 80 100 0

50

100

0

20

40

60

80

100

EI

SR

VSR

Blue: no weighting; Red: weighting GP 2/3, GTE 1/6, SR 1/6

Criticality Project Plan – May, 2012

Evaluating Criticality: A Summary

• What is critical to one organization may not be critical to another, and methodologies must take this into account

• Criticality is best regarded as an attribute of degree rather than as a state, and the important information is why a metal’s criticality is what it is, not whether the metal is “critical” or not

• The Yale comprehensive critical metals assessment will be complete by the end of 2012