Critical Resources: Supplying the Foundations of Innovation

Critical resource supply constraints could become a major bottleneck for AI, electrification, defense, and other technology infrastructure through 2040.

• A 1 GW data center can require nearly 180,000 tonnes of materials, including 27,212 tonnes of copper and 162 tonnes of rare earth elements.
• Mined supply shortages of 17% to 22% could emerge by 2035 for copper, lithium, and rare earth elements, while new mines typically take a decade or more to develop.
• Global copper demand could rise 50% between 2025 and 2040, with a potential 21% supply gap by 2035 after existing mines age and new projects face long permitting timelines.
• Lithium demand could more than double from 2025 to 2030 to reach 3.6 million metric tonnes of lithium carbonate equivalent, with electric vehicles and energy storage accounting for more than 90% of demand.
• Magnet rare earth demand could increase 80% from 93kt to 168kt by 2050, while China controls 85% of refined rare earth production and 94% of permanent magnet manufacturing; around two-thirds of new U.S. data centers since 2022 are in areas of high water stress.

Takeaway: Meeting the projected resource shortfalls could require nearly $550 billion of investment through 2040 across copper, lithium, and rare earth value chains, alongside growing opportunities in mining, processing, and water infrastructure, with supply diversification especially relevant for rare earths.