IDEAS home Printed from https://ideas.repec.org/a/bla/inecol/v25y2021i4p1051-1062.html
   My bibliography  Save this article

Design of an endpoint indicator for mineral resource supply risks in life cycle sustainability assessment: The case of Li‐ion batteries

Author

Listed:
  • Jair Santillán‐Saldivar
  • Tobias Gaugler
  • Christoph Helbig
  • Andreas Rathgeber
  • Guido Sonnemann
  • Andrea Thorenz
  • Axel Tuma

Abstract

Concerns have risen in recent years about the accessibility of raw materials considered “critical” for technological advancements. The GeoPolRisk indicator was designed as a midpoint indicator in life cycle sustainability assessment to measure geopolitical supply risk with the aim to incorporate raw material criticality as a complement to environmental life cycle assessment (LCA). A recent review of supply risk methods conducted within the Task Force on mineral resources of the Life Cycle Initiative hosted by UN Environment Programme highlighted the opportunity to extend the methodology to an endpoint level. We address this opportunity by presenting GeoPolEndpoint, an indicator that measures the socio‐economic damage of the use of mineral resources linked to the area of protection “Natural Resources” in LCA. We build upon previous efforts by introducing price elasticity considerations and modeling potential effects of supply disruptions on commodity markets in the form of a welfare loss and a loss of consumer surplus. The socio‐economic damage occurs as geopolitically driven increased costs for raw materials. We test our method on aluminum, cobalt, nickel, and copper, materials relevant for lithium‐ion batteries. Results show that nickel and cobalt dominate the contribution to socio‐economic damages because of their price and supply risk; we estimate the impact of the use of the four analyzed materials as a potential increased cost ranging from 0.30 to 1.86 USD/kWh depending on the technology and year. We build the steps to assess how the use of certain raw materials could have a substantial economic impact when developing technologies, possibly identifying the shifting of burden due to certain materials not usually deemed important from an environmental perspective. This article met the requirements for a gold‐gold JIE data openness badge described at http://jie.click/badges.

Suggested Citation

  • Jair Santillán‐Saldivar & Tobias Gaugler & Christoph Helbig & Andreas Rathgeber & Guido Sonnemann & Andrea Thorenz & Axel Tuma, 2021. "Design of an endpoint indicator for mineral resource supply risks in life cycle sustainability assessment: The case of Li‐ion batteries," Journal of Industrial Ecology, Yale University, vol. 25(4), pages 1051-1062, August.
  • Handle: RePEc:bla:inecol:v:25:y:2021:i:4:p:1051-1062
    DOI: 10.1111/jiec.13094
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/jiec.13094
    Download Restriction: no

    File URL: https://libkey.io/10.1111/jiec.13094?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Alexander Cimprich & Vanessa Bach & Christoph Helbig & Andrea Thorenz & Dieuwertje Schrijvers & Guido Sonnemann & Steven B. Young & Thomas Sonderegger & Markus Berger, 2019. "Raw material criticality assessment as a complement to environmental life cycle assessment: Examining methods for product‐level supply risk assessment," Journal of Industrial Ecology, Yale University, vol. 23(5), pages 1226-1236, October.
    2. Charlotte Benson & Edward J. Clay, 2004. "Understanding the Economic and Financial Impacts of Natural Disasters," World Bank Publications - Books, The World Bank Group, number 15025.
    3. Xinkai Fu & Adriano Polli & Elsa Olivetti, 2019. "High‐Resolution Insight into Materials Criticality: Quantifying Risk for By‐Product Metals from Primary Production," Journal of Industrial Ecology, Yale University, vol. 23(2), pages 452-465, April.
    4. T. E. Graedel & Barbara K. Reck, 2016. "Six Years of Criticality Assessments: What Have We Learned So Far?," Journal of Industrial Ecology, Yale University, vol. 20(4), pages 692-699, August.
    5. Kaufmann, Daniel & Kraay, Aart & Mastruzzi, Massimo, 2010. "The worldwide governance indicators : methodology and analytical issues," Policy Research Working Paper Series 5430, The World Bank.
    6. James V Koch & Robert N Fenili, 2013. "Using Event Studies to Assess the Impact of Unexpected Events," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 48(1), pages 58-66, February.
    7. Schnebele, Emily & Jaiswal, Kishor & Luco, Nicolas & Nassar, Nedal T., 2019. "Natural hazards and mineral commodity supply: Quantifying risk of earthquake disruption to South American copper supply," Resources Policy, Elsevier, vol. 63(C), pages 1-1.
    8. Raaj Sah & Kenji Wada, 2001. "Can Government Collect Resources Without Hurting Investors: Taxation of Returns From Assets," Working Papers 0127, Harris School of Public Policy Studies, University of Chicago.
    9. Eskinder D. Gemechu & Christoph Helbig & Guido Sonnemann & Andrea Thorenz & Axel Tuma, 2016. "Import-based Indicator for the Geopolitical Supply Risk of Raw Materials in Life Cycle Sustainability Assessments," Journal of Industrial Ecology, Yale University, vol. 20(1), pages 154-165, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Song, Yi & Zhang, Zhouyi & Zhang, Yijun & Cheng, Jinhua, 2022. "Technological innovation and supply of critical metals: A perspective of industrial chains," Resources Policy, Elsevier, vol. 79(C).
    2. Tamilselvan, M. & Halder, Abhishek & Kannadhasan, M., 2024. "Exploring the ingredients, mixtures, and inclinations of geopolitical risk," International Review of Economics & Finance, Elsevier, vol. 90(C), pages 187-206.
    3. Zhang, Zhouyi & Song, Yi & Cheng, Jinhua & Zhang, Yijun, 2023. "Effects of heterogeneous ICT on critical metal supply: A differentiated perspective on primary and secondary supply," Resources Policy, Elsevier, vol. 83(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Christoph Helbig & Martin Bruckler & Andrea Thorenz & Axel Tuma, 2021. "An Overview of Indicator Choice and Normalization in Raw Material Supply Risk Assessments," Resources, MDPI, vol. 10(8), pages 1-26, August.
    2. Vanessa Bach & Markus Berger & Natalia Finogenova & Matthias Finkbeiner, 2019. "Analyzing Changes in Supply Risks for Abiotic Resources over Time with the ESSENZ Method—A Data Update and Critical Reflection," Resources, MDPI, vol. 8(2), pages 1-16, April.
    3. Iulia Dolganova & Vanessa Bach & Anne Rödl & Martin Kaltschmitt & Matthias Finkbeiner, 2022. "Assessment of Critical Resource Use in Aircraft Manufacturing," Circular Economy and Sustainability, Springer, vol. 2(3), pages 1193-1212, September.
    4. Simon Glöser-Chahoud & Luis Tercero Espinoza & Rainer Walz & Martin Faulstich, 2016. "Taking the Step towards a More Dynamic View on Raw Material Criticality: An Indicator Based Analysis for Germany and Japan," Resources, MDPI, vol. 5(4), pages 1-16, December.
    5. Kühnel, Konstantin & Schütte, Philip & Bach, Vanessa & Franken, Gudrun & Finkbeiner, Matthias, 2023. "Correlation analysis of country governance indicators and the magnitude of environmental and social incidents in mining," Resources Policy, Elsevier, vol. 85(PA).
    6. Islam, Md. Monirul & Shahbaz, Muhammad & Samargandi, Nahla, 2024. "The nexus between Russian uranium exports and US nuclear-energy consumption: Do the spillover effects of geopolitical risks matter?," Energy, Elsevier, vol. 293(C).
    7. Adel Daoud & Björn Halleröd & Debarati Guha-Sapir, 2016. "What Is the Association between Absolute Child Poverty, Poor Governance, and Natural Disasters? A Global Comparison of Some of the Realities of Climate Change," PLOS ONE, Public Library of Science, vol. 11(4), pages 1-20, April.
    8. Kim Maya Yavor & Vanessa Bach & Matthias Finkbeiner, 2021. "Resource Assessment of Renewable Energy Systems—A Review," Sustainability, MDPI, vol. 13(11), pages 1-19, May.
    9. Greenwood, Matthew & Wentker, Marc & Leker, Jens, 2021. "A region-specific raw material and lithium-ion battery criticality methodology with an assessment of NMC cathode technology," Applied Energy, Elsevier, vol. 302(C).
    10. Buchmayr, A. & Verhofstadt, E. & Van Ootegem, L. & Sanjuan Delmás, D. & Thomassen, G. & Dewulf, J., 2021. "The path to sustainable energy supply systems: Proposal of an integrative sustainability assessment framework," Renewable and Sustainable Energy Reviews, Elsevier, vol. 138(C).
    11. Daoud, Adel & Halleröd, Björn & Guha Sapir, Debarati, 2015. "Quality of government and the relationship between natural disasters and child poverty: A comparative analysis," MPIfG Discussion Paper 15/5, Max Planck Institute for the Study of Societies.
    12. Li, Baihua & Li, Huajiao & Ren, Shuai & Liu, Haiping & Wang, Gang, 2023. "Commodity supply risk assessment of China's copper industrial chain: The perspective of trade network," Resources Policy, Elsevier, vol. 81(C).
    13. Mehmet Maksud Onal & John K. Ashton, 2021. "Is the Journey more Important than the Destination? EU Accession and Corporate Governance and Performance of Banks," Journal of Common Market Studies, Wiley Blackwell, vol. 59(6), pages 1516-1535, November.
    14. Kapeliushnikov, Rostislav & Kuznetsov, Andrei & Demina, Natalia & Kuznetsova, Olga, 2013. "Threats to security of property rights in a transition economy: An empirical perspective," Journal of Comparative Economics, Elsevier, vol. 41(1), pages 245-264.
    15. Rakesh Sambharya & Martina Musteen, 2014. "Institutional environment and entrepreneurship: An empirical study across countries," Journal of International Entrepreneurship, Springer, vol. 12(4), pages 314-330, December.
    16. Kumar, Sanjesh & Singh, Baljeet, 2019. "Barriers to the international diffusion of technological innovations," Economic Modelling, Elsevier, vol. 82(C), pages 74-86.
    17. Christoph M. Schmidt & Nils aus dem Moore, 2014. "Wie geht es uns? Die W3-Indikatoren für eine neue Wohlstandsmessung," RWI Positionen, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, pages 16, 03.
    18. Hadzi-Vaskov Metodij & Pienknagura Samuel & Ricci Luca Antonio, 2023. "The Macroeconomic Impact of Social Unrest," The B.E. Journal of Macroeconomics, De Gruyter, vol. 23(2), pages 917-958, June.
    19. Lochner, Stefan & Dieckhöner, Caroline, 2012. "Civil unrest in North Africa—Risks for natural gas supply?," Energy Policy, Elsevier, vol. 45(C), pages 167-175.
    20. Simplice A. Asongu & Nicholas M. Odhiambo, 2019. "Governance, capital flight and industrialisation in Africa," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 8(1), pages 1-22, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:inecol:v:25:y:2021:i:4:p:1051-1062. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=1088-1980 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.