New report highlights raw material risks for Scotland’s economy

Scotland’s economy relies on many raw materials for its functioning but which ones and how secure is the supply? The importance of future availability of fossil fuels is well known, and has been a discussion point for many years, but what about cobalt, phosphorus and aggregates?

15 Feb 11

Raw Materials Critical to the Scottish Economy, a research project funded by the Scottish Environment Protection Agency (SEPA) and carried out by SNIFFER, lays out for the first time what supply risks in raw materials could mean for Scotland, and asks what opportunities may be out there for Scottish businesses.  Scottish Enterprise, Highlands and Islands Enterprise, Scottish Government and Zero Waste Scotland all provided advice and were closely involved in steering the research.

Lorna Walker, Senior Policy Officer in SEPA, said:

“The issue of resource risk is a new and emerging one on the international stage and SEPA felt it was important that we gained a better understanding of the impact this could have on Scotland’s economy and the global environment, and how we can better manage our resources.

“With the global population projected to rise to nine billion by 2050 and some emerging economies growing by up to 10% per annum, it is inevitable that resource constraints will be felt – either through price rises or disruptions to supply. Indeed some of these effects are already being felt, with China imposing export quotas on rare earth elements and the price for phosphate rock rising 700% between 2007-8.”

Andy McDonald, Senior Director of Renewables & Low Carbon Technologies at Scottish Enterprise, said:

“These resources are critical to the functioning of the Scottish economy and many of them are important for the transition to a low carbon economy, such as Rare Earth Elements (magnets for wind turbines), lithium (batteries for electric vehicles) and copper and indium (solar cells). The potential future scarcity of these key materials will drive the economic opportunities within the transition to a more sustainable economy. This future growth will be shared across all of our key sectors as they both develop and adopt new technologies and processes which will increase their competitiveness and decrease their environmental impact.”

The work identified the top 12 materials which are critical to the Scottish economy and are likely to be subject to supply shocks in the short to medium term, as well as the seven sectors of the economy which may be vulnerable.

Diane Duncan, Head of Environment and Low Carbon Technologies at Highlands and Islands Enterprise, said:

‘This report not only flags up some significant risks to Scotland's new and emerging renewables sector, but some significant opportunities for business right across Scotland. Some businesses are already ahead of the game and are working to find or develop alternatives. We need to promote a wider understanding of resource efficiency. This report provides us with a very useful evidence base from which to work.'

Iain Gulland, Director of Zero Waste Scotland, said:

“The availability of resources is now a major influence on the world economy, and price volatility for key commodities is a serious risk to growth. Here in Scotland we can take action to minimise this risk by using resources more efficiently, working to prevent waste, and recovering precious materials from the waste stream. “This report is a welcome step in helping understand where the key issues lie, and it shows clearly that moving towards zero waste is not an environmental ‘nice to have’ – it is an economic need.”

Dave Gorman, SEPA’s Head of Environmental Strategy, said:

“There are real opportunities here for Scottish businesses. Some have already taken the opportunity to look at solutions and alternative methods of working, which have not only improved efficiencies but also improved business reputation, environmental performance and consumer opinion. In some cases new businesses are born out of creating a solution to a resource risk and better understanding how these materials are so important to our economy and environment will help with this.”

Opportunities for businesses include:

  • Preserving primary resources, in particular sustainable management of renewable resources such as timber, fish and palm oil.
  • Recovery of critical materials from processes and products to ensure they are available for future use (firmly establishing closed loop resource use – and retaining the value of resources value within the Scottish economy).
  • Identifying alternative materials which face lower supply risks and environmental impact.
  • Reducing environmental and social impacts of extraction of primary resources.
  • Improving process efficiencies – to ensure valuable resources are not wasted and reduce our overall climate impact. It has been estimated that resource efficiency could deliver 10% of the carbon reductions needed by 2020

Source: Scottish Environmental Protection Agency (SEPA)

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