Bolivia's lithium frontier: Can public private partnerships deliver a minerals boom for sustainable development?
Introduction
In this paper, we start from the materials central to the global transition to low carbon energy and focus on lithium used for energy storage batteries, as a key transition material. We investigate how the desire for cleaner technologies has cultivated unusual partnerships between state enterprises and foreign-owned private corporations, often in developing countries rich in alternative energy materials. Focusing on Bolivia, we consider the efficacy of vertically integrated mineral development and public-private partnerships (PPPs) in developing remote mineral reserves for advanced technologies in developing countries. These will be necessary for assuring an economically and ecologically efficient transition towards less reliance on fossil fuels internationally. New energy transition governance measures also have potential to address broader sustainable development goals and ethical issues, which were high on the agenda in the Paris 2015 United Nations Climate Change Conference (COP21).
Lithium remains key to low carbon global transitions given its unique properties as the lightest metal with unparalleled energy density ability for storage, allowing solar, wind and other non-continuous energy development to be more effectively harnessed (Lu et al., 2017). Lithium is also vital for energy efficient hybrid and battery-electric cars to reduce pollution. It has been defined as a ‘critical material’ by the United States (US), United Kingdom (UK), European Union (EU) and Geoscience Australia (Executive Office of the President, 2016, Geoscience Australia, 2016, Skirrow et al., 2013, 11–2; WWF-Ecofys, 2014). To meet this demand for lithium, with minimal environmental impact and to facilitate broader sustainable development and ethical supply chains, novel approaches to international partnerships in resource extraction that transcend ideological biases are needed, with their efficacy evaluated. In this article, we discuss the debate on cleaner technologies for lithium production, explain the Bolivian focus and outline the Morales Government's vertically integrated mineral development model. We then explain how PPPs link with the UN SDGs and set out some principles for an evaluative framework. Our research aims to pave the way towards an evaluative framework, using Bolivia's lithium as a central case.
Section snippets
Lithium production for clean energy technologies
Markets for cleaner technologies currently favor lithium batteries due to reduced costs and their technical and performance advantages over other battery types (IRENA, 2015, Climate Council, 2015). The market has moved away from lead and sodium-sulphur to lithium-ion batteries, based on energy and power density, decreased cost and deep discharge cycle life (IRENA, 2015, 27). Lithium is also used in many products including mobile phones, pharmaceuticals, building tools and aeronautic systems and
Bolivia's moral imperative message and the challenges of developing lithium
Bolivia is pertinent for two main reasons: its leadership on arguing developed countries' international moral culpability for climate debt repayment and promotion of lithium as a national resource priority under resource nationalism. Its plans for lithium industrialization through vertically integrated mineral development and PPPs with foreign corporations, are aimed at harnessing the most environmentally appropriate technologies and jobs for development across the lithium supply chain. Since
Bolivia's vertically integrated mineral development
Internationally, the prevailing extraction model in developing countries is that of extractivism, where materials are extracted, transported or shipped, with processing, manufacturing and marketing of minerals and products taking place elsewhere. Processing countries frequently have low restrictive environmental regulation and cheap labor, thus transferring emissions to processing countries whilst also depriving source countries of industry development, jobs and technological innovation.
Reinventing resource nationalism in Bolivia
Mining investors from the private sector often identify ‘resource nationalism’ as a key risk in mineral development projects worldwide. For example Grimley (2015), based on Ernst and Young's 2014 report on Business Risk Radar for Mining and Metals, warned that “mandated beneficiation and state ownership has been the most dramatic pattern of recent resource nationalism”. Bolivia's politics in the last decade have been highly influenced by nationalist populism over natural resources. In 2006,
Public-private partnerships, technology transfer and sustainable development
PPPs can act as mechanisms for technology transfer alongside foreign direct investment and licensing, and industry-specific policies, sometimes conducted with donor support. These might include finance for foreign-local research and development collaboration, local-content policy, publicly funded research, technology transfer agreements, joint ventures, support for industry organizations, science and technology parks, clusters and initiatives to lure expatriates; alongside stable macroeconomic
Developing an evaluative PPP framework aligned to the sustainable development goals
PPP guidance materials already exist from such organizations as the EU, World Bank and United Nations Economic Commission for Europe (UNECE). Good governance principles for PPPs should focus on policy, capacity-building, legal framework, risk-sharing, procurement, putting people first, and the environment. Within these areas, governments should integrate good governance standards for participation, decency, transparency, accountability, fairness, efficiency and sustainable development (UNECE,
Conclusion
A key vulnerability of the transition from a fossil fuel driven economy to a low carbon economy, is the international governance void across crucial mineral supply chains. Countries such as Bolivia that are well-resourced in critical materials are vulnerable to such a governance void and to the downfalls of public-private partnerships documented over the last twenty years. Lithium mining to support the global demand for energy storage devices could bring development to neglected parts of the
Acknowledgments
Funding from the Australian Research Council Centre of Excellence Scheme (Project Number CE 140100012) is gratefully acknowledged. ARC Centre of Excellence for Electromaterials Science: www.electromaterials.edu.au. The funders had no role in study design, data collection and analysis, decision to publish, or preparation of the manuscript.
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