Energy Department officials said yesterday that developing alternatives to critical materials, like rare earth metals used in solar panels and wind turbines, is crucial to American manufacturing stability and can help the United States circumvent global market pressures.

"There have been some geopolitical tensions around these issues over the last several years," said David Sandalow, DOE assistant secretary for policy and international affairs, in an oblique reference to trade disputes with China over rare earth production.

China has a near-monopoly on these minerals and halted some mining operations last year after prices fell sharply, prompting an investigation from the World Trade Organization.

Such supply bottlenecks can ripple throughout the manufacturing sector, particularly for clean technologies like photovoltaic cells and electric vehicle motors that rely on rare materials. According to DOE's 2011 Critical Materials Strategy report, the United States faces supply challenges for dysprosium, europium, neodymium, terbium and yttrium. Other metals like lithium are teetering on the brink of shortages.

To combat this, the department last week announced the Critical Materials Institute, an interdisciplinary research hub, at DOE's Ames Laboratory in Iowa (ClimateWire, Jan. 9). The program will receive $120 million over five years.

Alex King, director of the new materials hub, said his objectives are to target all aspects of the critical materials supply chain. "I think the short-term objective is to make mining viable no matter what the cost profile looks like," he said, noting that developing mineral resources inside the United States can be difficult due to transportation costs, volatile markets and environmental regulations. "Some of our goals are to help them and other processes to meet those requirements at lower costs," he added.

Another objective is to reduce the demand for some of these critical materials by developing technologies that do not need them or by creating substitutes. The institute will also develop forecasting models so they can anticipate and avoid materials shortages.

Lithium shortage likely to worsen

"Lithium is a near-critical element now," King said, observing that the rise of electric vehicles and their lithium chemistry batteries will create a demand surge for the metal. These problems will only get worse as more renewable energy sources and electric vehicles come online.

Collecting critical materials from turbines, batteries and motors at the ends of their lives is also a challenge. "Recycling from waste streams is usually harder to do than extracting ores from the ground," King said, noting that scraping a few grams of important elements from light bulbs and cellphones may not be cost-effective. "Recycling works in some cases. It does not work in all cases."

Some industry players applauded DOE's efforts. "The ability to acquire materials is critical to keeping the manufacturing process going," said Steven Duclos of GE Global Research.

He noted that GE uses 72 of the first 82 elements on the periodic table and that its own internal analysis shows that rare earths are top elements of concern. "The critical materials hub is a key component of ensuring we have the science done for working on the mitigation portions of these risks," Duclos said.

However, this materials hub is not DOE's first stab at the problem. The Advanced Research Projects Agency-Energy allocated $27 million in 2011 to 14 projects to find alternatives to rare earth compounds in electric motors and magnets. The Critical Materials Institute "is part of a broader strategy. The work here can certainly help American manufacturing," Sandalow said.