JPAB – José Pedro Aguiar-Branco Advogados

Associates Area

Electrical mobility and dependence on geological resources: a giant with feet of clay?


Much has been debated in Portugal about the future of electric mobility. There has been a growth in the demand for vehicles totally powered by electric energy and hybrid vehicles, and the basis for choosing an electric vehicle is not only reasons for savings, but environmental concerns and a background option for a new style of life.


Portugal has been cited as an example regarding the consumption of electricity from renewable sources and the transport sector is considered as one of the main in terms of possible contribution, not yet realized, for the decarbonization of the economy.


The problem, which is not new, is that of energy storage that is not immediately consumed. Its storage in batteries is extremely expensive and, as such, a barrier to the diffusion of renewable energies. There are ongoing projects for the creation and development of smart electric mobility networks, where recharging of batteries occurs when the electricity supply exceeds the needs, namely in the peaks of production of renewable energies or at times when the electricity tariff is higher cheap, and, in turn, the vehicles are also able to inject electricity in the network at peak consumption times.


It is in this context that the reference to lithium, as "gasoline of the future", "white gold", or "new oil", is particularly highlighted, since lithium-ion batteries have the greatest potential for electric vehicles.


Portugal is considered to be rich in reserves of this alkali metal and the sixth largest producer in the world. However, in our country, lithium is used as a flux in the ceramics industry and not yet in the direct application in the manufacture of electric batteries, especially those used in automobiles.


This is because lithium among us is found in resources of mineral origin, in reserves and deposits, and not in salt lakes, as in Chile, Argentina or Bolivia, which facilitates and considerably reduces its extraction and transformation in the form of lithium carbonate, as required by the use in batteries.


In the Portuguese case, the extraction and transformation of lithium, for use in electric batteries, therefore, requires high technical and financial capacity.


In spite of the fact that the international lithium market is not regulated, the Portuguese reality has already made the Government, "Responding to the dynamism that has been verified in our country of requests for the attribution of exploration rights and research and exploitation of lithium mineral deposits , leveraged by the global demand for this metal with a view to their use in batteries for the automotive industry ", created, by means of Order No. 15040/2016, the Secretary of State for Energy, published in the DR, of 13.12.2016, the "Lithium" Working Group.

 

The current mining legislation in Portugal is contained in Law no. 54/2015 of 22.06. Although it is expected that the complementary legislation of this law will be approved until 23.09.2015, the truth is that such diplomas are still awaited, and the regulations previously approved under Decree-Law n (Decree-Law no. 88/90, of 16.03).

 

Under the current regulation, sustainable exploitation of geological, economic, social, environmental and territorial resources should be ensured, taking into account the values of transparency and security in attracting investment, the public interest of geological resources integrated in the field State and its scarce, irreplaceable and non-relocable nature.


So the concern is: Will the supply of lithium be able to keep up with the growth of the production of batteries for electric vehicles?

 

It seems to us that more attention is being paid to such an enticing sector, with redoubled regulation and supervision, on pain of creating a giant submissive to a new resource, replacing dependence on oil for a new dependency, a resource also finite.

 

In our view, therefore, the prospect must be broader in the long term and above all the public interest and an integrated logic associated with building sustainable embarrassed

In this sense, we share Tam Hunt's reflection here: "We can reasonably expect that lithium reserves and resources will increase the market demand grows. But as with all finite resources, we can expect to reach peak in production at some point. I've written about the peak oil debate fairly extensively, so it's only fair and rational to apply a similar analytical lens to lithium production. Even this little sketch of the issue highlights the obvious conclusion: we need to get our best to get away from single passenger cars - even EVs - and rely more on smart city design, walking, biking, carpooling, trains, shuttles, etc. . "

 

 

Joana Silva Aroso

Attorney and Partner of JPAB Advogados
Coordinator of the Environment and Energy Area

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