Highlights

• The global energy transition risks embedding massive upstream emissions as demand for lithium, nickel, cobalt, and copper may rise 500% by 2050, with much refining occurring in carbon-intensive regions emitting ~580 gCO₂/kWh.
• Spatial optimization—aligning refining infrastructure with mineral sources and low-carbon energy—offers a solution by repurposing legacy coal assets and co-locating facilities with renewable hubs.
• Control over geography, energy inputs, and processing locations will define competitive advantage in critical minerals for India and Western supply chains in the green transition era.

A growing body of analysis suggests that the global energy transition—while aimed at decarbonization—risks embedding significant upstream emissions through the production of critical minerals. Demand for materials such as lithium, nickel, cobalt, copper, and rare earth elements is projected to rise dramatically, potentially increasing by up to 500% by 2050, placing unprecedented pressure on supply chains and infrastructure.

At the center of the issue is the concentration of midstream refining capacity in regions with carbon-intensive power grids. Today, much of the world’s refining—particularly for rare earths and battery metals—occurs in jurisdictions where electricity emissions remain high, contributing to elevated lifecycle greenhouse gas intensity.

According to Meheli Roy Choudhury via HinduBusiness Online (opens in a new tab),  refining processes in some regions can emit approximately 580 gCO₂/kWh, underscoring the paradox of a “green” transition powered by carbon-heavy inputs.

The emerging solution: spatial optimization. By aligning refining infrastructure with both mineral resource locations and access to low-carbon energy sources, countries can materially reduce embedded emissions while improving cost efficiency. Strategies under consideration include repurposing legacy industrial assets, such as aging coal infrastructure, and co-locating processing facilities with renewable energy hubs.

For markets like India—and increasingly for Western supply chains—the implication suggests a clarity according to this vantage: control over geography, energy inputs, and processing location will define the next phase of competitive advantage in critical minerals.