Bold Business Logo
Search
Close this search box.

Earth vs. Economics: Mining Brings Jobs But Also Pollution

some nickel mining for EV batteries

Climate change and global warming encourage all of us to take a greener approach to our future. This is particularly true when it comes to using alternative forms of energy with fewer environmental impacts. This accounts for the relatively rapid shift fossil fuel vehicles to electric ones. These vehicles, alongside their EV batteries, produce far less pollution and are much more sustainable. But as with the adoption of several green technologies, there are trade-offs. In the case of electric cars, nickel mining for EV batteries is one activity that has several potential environmental harms. And it’s these negative effects of mining for nickel that demand our attention sooner rather than later.

some dudes nickel mining for EV batteries
On the one hand, nickel mining for EV batteries creates jobs. On the other hand, it’s rough on Mother Earth.

(The world needs precious metals and rare earth elements–read why in this Bold story.)

Nickel mining for EV batteries is currently being performed in a small number of places throughout the world. Russia is a major producer as is Canada and the Philippines. However, the region conducting the lion’s share of nickel mining involves the Sulawesi area in Indonesia. According to the International Energy Agency (IEA), Indonesia will produce over 65% of the global nickel required. This will take place over several years as the demand for nickel is anticipated to grow 40-fold within 15 years. But unless proper safeguards are established, the negative effects of mining nickel in Sulawesi could be tremendous. Indeed, these activities are bringing greater prosperity to the region. However, it’s also disrupting traditional ways of life and livelihoods along the way.

Nickel Mining in Sulawesi

The demand for nickel has been increasing for some time. Not only has nickel mining for EV batteries accounted for higher demand. But countries and companies need nickel to make other products like stainless steel and mobile phones. As a rare earth metal, however, nickel must be mined, which can be an energy-intensive process. Nickel ore must be extracted from the ground and refined via smelters. This requires not only energy to power these nickel mining plants but likewise energy for its transport. Thus, the negative effects of mining must be weighed against this rising need for nickel. Most believe long-term benefits exceed these extraction costs from nickel mining. But not everyone is so sure.

As an area with an abundance of nickel ore, Sulawesi has attracted many Chinese nickel mining companies. It has also enjoyed increased mining activities from an economic perspective in several ways. The companies mining nickel naturally need workers, which has significantly improved job opportunities in Sulawesi. Likewise, Chinese workers living in company dormitories on the island provide new consumers for Sulawesi markets. Nickel mining for EV batteries and other products has therefore raised the standard of living on Sulawesi. But at the same time, it is affecting traditional ways of life including fishing and agriculture. And the negative effects of mining could also undermine human health in the region due to pollution. These are the issues with which Sulawesi is currently struggling.

some trucks and machine riding the mining road
In the battle between economics vs. Earth, one side wins a lot more than the other.

Nickel Mining and Sulawesi’s Environment

The negative effects of mining for nickel extend well beyond the direct land use impacts. Certainly, there are concerns about the associated deforestation that occurs with nickel mining. Trees must be cleared in order to extract earth and nickel ore contents. This is likely to have undesirable effects on climate change and global warming over time. But additional polluting worries relate to air pollution that results from smelters and coal-burning plants for electricity. Over 6,000 Chinese live in nickel mining plant dormitories in Sulawesi, which requires energy generating systems. Coal, as a cheap option, is being used to meet energy needs, and this has contributed greatly to a lower air quality. The number of residents on Sulawesi with lung problems have notably increased in recent years.

Air pollution and poor air quality are not the only negative effects of mining nickel on Sulawesi. Water pollution is also another concern brought about by nickel mining for EV batteries and related products. Smelters produce a reddish-brown waste that often ends up in regional waters. And other chemicals like sodium cyanide and diesel byproducts exist in water runoffs from deforested areas. This causes many of the traditional fishing waters to become murky, which impacts local fishing activities. At the same time, these chemicals and compounds are damaging to local ecosystems and habitats within Sulawesi’s waters. Improved labor markets and incomes may be resulting from nickel mining for EV batteries. But there is little question that long-range costs do exist.

(What do you know about lithium batteries? If the answer is not much, Bold has got you covered here.)

Balancing the Pros and Cons of Nickel Mining

some dudes watching the negative effects of mining
Do the negative effects of mining outweigh the good?

The government of Sulawesi has invested in efforts to offset the negative effects of mining. Specifically, it requires plants nickel mining for EV batteries to participate in reforestation efforts. Financial compensation is also provided to residents in areas adjacent to smelters and nickel mining operations. But in some cases, these requirements are not adequately enforced. And illegal mining operations not sanctioned by the government exist that ignore these rules. Unless these safeguards are actually respected, it’s likely that pollution-causing activities will worsen. And this will come at a social cost to residents that will not justify the positive economic impacts.

There is little question that many residents in Sulawesi have benefited from higher wages and increased jobs. Factor jobs at plants performing nickel mining for EV batteries raise incomes by about 25-fold. But even here, there are some issues when it comes to social justice. The vast majority of Sulawesi workers receive the lowest wages in the plants. In contrast, Chinese workers occupy higher ranks within the companies and enjoy increased incomes. This has not gone unnoticed with worker protests regularly taking place and requiring police crackdowns. Thus, negative effects of mining extend well beyond air and water quality. They also include disruptions to social classes and cultures.

If Sulawesi wants to better balance the pros and cons of nickel mining for EV batteries, changes are needed. Long-term environmental protections need to be in place and enforced. Likewise, fair labor practices must be encouraged while protecting local traditions and ways of life. Naturally, this is not easy, especially when trying to raise citizen’s standards of living to reasonable levels. But short-term gains while sacrificing long-term prosperity isn’t an approach the government of Sulawesi needs to take.

 

What is the Broadband Equity Access Deployment (BEADs) Program? Find out in this Bold explainer!

Don't miss out!

The Bold Wire delivers our latest global news, exclusive top stories, career
opportunities and more.

Thank you for subscribing!