The energy transition will not succeed without copper. Thanks to KGHM, Poland is safe in terms of access to deposits of this element.
The role of the red metal in the economy is underlined by the country's Raw Materials Policy 2050, adopted last year. Copper was identified there as essential for stable development, especially of the energy industry. This approach is in line with global trends - as Goldman Sachs analysts assert in their report 'Global Markets Daily: The Growing Influence of Green Capex on Copper Fundamentals', by 2030, nearly 20 per cent of global demand for the commodity will be generated by green transition and energy security projects.
The world's largest economy, the USA, is also emphasising the role of copper. The US Department of Energy recently decided to add the red metal to its list of critical raw materials. In Poland, we have assured access to this raw material, as copper extraction from KGHM's Lower Silesian deposits currently accounts for 50 per cent of total copper mining production in the EU.
Fuel for innovation
One of the drivers behind the demand for copper on our continent is the Green Deal, which involves reducing greenhouse gas emissions. Without copper, its realisation will not be possible, as 22 million tonnes of copper are needed to achieve the energy transition in Europe.
It is crucial in many technological innovations, including those related to green energy. It is used in wind turbines or electromobility.
Nowadays, with rising oil prices and the need to find more sustainable energy sources, wind energy has never been more popular. Huge wind farms with turbines and individual power generation units are becoming more common as more and more people seek to offset the effects of climate change. And this is where copper plays an important role. A single 3 MW wind turbine, for example, contains up to 4.7 tonnes of copper, while building a 1 MW solar power plant requires 3.1 to 4.5 tonnes of this raw material. Relatively thick but soft copper is preferred for use in silicon cells to reduce their brittleness and increase throughput.
Back in 2017. The World Bank predicted that by 2050, the expanding production of wind turbines would need 300 per cent more metals, 200 per cent more metals would be needed to make solar panels and as much as 1,000 per cent more metals would be needed to make batteries - which includes copper.
Copper and the automotive industry
The growth of the electric car market will have a significant impact on the demand for copper. And it is not just the electric vehicles themselves (their batteries and control systems), but also the electrical infrastructure needed to power them.
The World Bank predicts that the electric vehicle industry will need 1.74 million tonnes of copper by 2027. It takes up to four times more of this raw material to produce an electric vehicle than an internal combustion car (83 kg instead of 23 kg). And their global production is growing all the time, according to EY, 10 million cars were made in 2022, in less than 20 years it will be 70 million a year.
It is therefore impossible to disagree with the view put forward by Frank Holmes, head of investment firm US Global Investors, in the pages of US Forbes that "there is currently a worldwide race for the red metal, and copper is undoubtedly the metal of the future".
Source: KGHM / https://biznes.wprost.pl/firmy-i-rynki/11489009/wyscig-oczerwony-metal.html
