As the world continues to move toward a sustainable and energy efficient future, copper has a major role to play. If global energy consumption reduces by three percent annually, copper demand would experience a cumulative increase of 17,672 KT over ten years, according to a study by Navigant Research and commissioned by the International Copper Association (ICA).
Based on the activity of the Three Percent Club, a collaboration of governments and supporting organizations that commit to working together to put the world on a path to three-percent annual efficiency improvement, the new research found copper demand would grow in six technology groups across transport, buildings and industry sectors.
Energy consumption: base scenario compared to energy efficiency scenario
Under the base scenario, energy consumption is expected to grow 13 percent between 2020 and 2030. In the efficiency scenario, energy consumption declines 24 percent between 2020 and 2030.
Reducing energy consumption is essential to meet global climate goals and the United Nations Sustainable Development Goal 7. Copper is used to decrease consumption and increase the efficiency of numerous electrical technologies, from motors and transformers to solar and wind energy systems.
According to Sasha Wedekind, Energy Efficiency Research Analyst at Navigant, “The impact of reducing energy consumption by three percent annually would significantly increase copper demand. Our research found demand would increase across the world and within the three industries studied.”
Largest opportunity for the transportation sector
Navigant’s research found that the largest opportunity for demand gains are from increased energy efficiency in the transportation sector–primarily driven by growth in electric vehicles and plug-in hybrids.
In the three-percent scenario, demand would increase at an 11.8 percent compound annual growth rate Compound Annual Growth Rate (CAGR) in the transport sector. Transport is also the sector most likely to achieve the three percent scenario due to existing and expected transportation electrification policy in several countries.
Impact on industry
Electric motors contribute the most demand in industry due to the extensive use of copper in electrical motor components both in baseline and high-efficiency scenarios. Within industry, the replacement of transformers with more efficient alternatives results in growth in demand at a CAGR of 2.8 percent in the efficiency scenario.
Since copper is the best nonprecious conductor of heat and electricity, it is essential for an efficient generation and delivery of electricity. Navigant’s findings demonstrate the value copper can deliver for the global economy by facilitating the reduction of energy consumption.