AME expects US demand for refined copper to grow
1.4% in 2022 to 1,797kt, before expanding another 1.5%
in 2023 to 1,824kt. Our current forecasts are down from
our previous forecast of a 2.7% increase in 2022 to
1,820kt, before expanding another 3.2% in 2023 to
1,878kt.
The Federal Reserve's aggressive monetary policy
tightening is slowing the country’s consumption and
weighing heavily on the construction market, the largest
copper consumption sector in the US. Meanwhile, the
US is experiencing difficulties such as high input prices,
worker shortages and supply chain disruptions, which
are slowing down growth. Following a decrease of 0.6%
in July, US construction spending in August slipped
again at 0.7%.

Despite the short-term weak demand on the
deteriorating macro environment, US demand for refined
copper is forecast to rise over the medium term at a
robust CAGR of 2.3% to reach 2,011kt by 2027, before easing to a moderate CAGR of 1.8% over the long term
to reach 2,535kt by 2040.
Construction will be bolstered
by the US Infrastructure Bill. The country will continue to
expand its EV production, clean energy infrastructure
and domestic manufacturing capability.
Significant
upside revolves around increased public spending on
infrastructure as President Biden aims to boost
American manufacturers of green products, to power the
economy medium-to-long-term, increase
competitiveness, and fight climate change. Clearly,
copper, with all its green energy applications, will be in
high demand in all consumption sectors in future.
EV Boom Goes On
The US ambitious carbon goal would require a radical
transformation of the nation’s economy, including cars
and trucks powered by internal combustion engines
being replaced by their zero-emission counterparts.
President Biden has set a goal that 50% of new US car
sales be electric by 2030. He plans to build a national
network of 500k EV chargers by 2030. His plan will also
replace 50k diesel transit vehicles, electrify at least 20%
of the nation’s school bus fleet, and replace the
government’s fleet of 645k vehicles with EVs.
The US Department of Transportation has given final
approval for all 50 states to begin construction on a first
nationwide network of EV charging stations that places
one roughly every 50mi (80km) along interstate
highways. This triggered the release of US$1.5bn in
federal funds—or US$5bn over five years, as part of the
Biden administration's goal of installing 500k EV
chargers nationwide along federal highways.
California has passed rules prohibiting the sale of new
gasoline powered cars by 2035. As other US states
traditionally follow California’s standards, the new plan
will accelerate the country’s transition to EVs, which in
turn will increase copper demand.
Auto and battery makers have seen the writing on the
wall and are making big promises in the hopes of
grabbing market share as the sector continues to grow.
Volkswagen plans to invest at least US$7.1bn for North
America over the next five years and add more than 25
new electric vehicles there by 2030.
General Motors (GM) has set a target to deliver 400k
EVs in North America during 2022 and 2023. It plans to
spend US$27bn to develop its 30 EVs by 2025, with
two-thirds of these being available in the US.
GM, with
joint-venture partner LG Chem, has begun production at
its US$2.3bn, 35GWh-capacity battery plant in Ohio.
The company plans to build a second plant in
Tennessee, which will be similar in scope.
Ford said it would almost double its investments in EVs
to US$22bn through 2025, with another US$5bn
invested in autonomous vehicles.
Jeep has announced it will launch four all-electric SUVs
in Europe and North America by the end of 2025. By
2030, the company is targeting 100% of vehicles sold in
Europe and 50% of sales in the US will be all-electric.

Car rental companies and logistics operators are
also getting on board.
Hertz recently announced hundreds of thousands
of EV orders from the likes of Tesla, GM and Polestar.
Hertz is aiming for 25% of its fleet to be electric by 2024.
Hertz is also teaming up with oil giant BP to build out a
fast-charging network in the US for its growing EV rental
fleet.
BP plans to expand its network of EV chargers to
100k plugs by 2030. Direct-current fast chargers, which
can deliver up to 100mi (161km) of EV range in five to
ten minutes, will account for 90% of those.
North American logistics operator Pride Group
Enterprises has ordered 250 heavy-duty electric trucks
from Daimler Truck’s Freightliner brand. The trucks will
join the company’s fleet in mid-2023, as part of Pride's
goal to become completely electrified by 2024.
Freightliner has also received orders for its heavy-duty
electric trucks from Walmart and US food delivery
company Sysco, which could take up to 800 e-trucks.
Freight transportation moves about 70% of goods in the
US market. The Inflation Reduction Act, passed into law
last month, provides a US$40k tax credit for buyers of
medium- and heavy-duty zero emission vehicles.
Wind Takes Off
The accelerating shift towards renewable energy will
require huge quantities of copper. This is particularly the
case for wind energy, which is the most copper-intensive
form of power generation.
The US government has set a goal to deploy 30GW of
offshore wind power in the US by 2030. Efforts to meet
this target will trigger more than US$12bn per year in
capital investment in projects. This will unlock a pathway
to deploy 110GW by 2050.
In the state of New Mexico, Pattern Energy Group has
completed construction of the 1.1GW Western Spirit
wind complex, which marks the country's largest singlephase renewable energy project to date.
Western Spirit
Wind is accompanied by a 241km transmission line from
the wind power complex to the New Mexico grid. Pattern
Energy has committed to a further US$6bn to wind
energy and related infrastructure projects in New Mexico
over the next decade.
Construction has begun on the 806MW Vineyard Wind 1
project in Massachusetts, the first commercial-scale
offshore wind farm in the US. Massachusetts has
already contracted nearly 2.5GW of offshore wind and
committed to reach to 5.6GW by end of June 2027.
Rise Light & Power is set to start a mature offshore wind
transmission project to replace existing fossil fuel
generation with renewable energy. This will be the New
York’s third offshore wind solicitation to produce 2GW of
offshore wind energy.
Dominion Energy, has received approval to build 2.6GW
Coastal Virginia Offshore Wind (CVOW) project at 27
miles off the coast of Virginia Beach. It is due to
complete construction in 2026.
Solar Shines Copper
Looking at solar energy, the US will continue to advance
the future-growth sector, which means demand growth
for copper given it requires higher amounts of the red
metal per unit of energy produced than fossil fuel-based
power generation.
The EIA expects 21.5GW of new solar capacity
additions this year, surpassing last year’s 15.5GW of
solar capacity additions. The new solar capacity
represents around 46% of the 46.1GW of new utility scale electric generating capacity to be added to the US
power grid.
It is followed by natural gas at 9.6GW (21%),
wind at 7.6GW (17%), batteries at 5.1GW (11%), and
nuclear at 2.2GW (5%). Most planned solar additions in
2022 will be in Texas (6.1GW, or 28% of the total
national additions), followed by California (4.0GW).
Spanish utility Naturgy Power Group SA has begun
construction of a US$278m 300MW photovoltaic (PV)
solar farm in Texas. Commercial operation will
commence by end of 2023 and produce around
560GWhpa. The Spanish utility plans to invest over
EUR1bn (US$1bn) in the US, targeting an operational
capacity of 500MW in 2023 and 1.2GW in 2025.
An initiative to boost distributed solar energy in the US
state of New York to at least 10GW by 2030 has been
approved by the Public Service Commission (PSC).
Governor Kathy Hochul announced a plan to expand the
US$1.8bn, NY-Sun programme in September 2021 to
bolster the state’s post-pandemic economic recovery.
The state is currently approaching the programme’s
6GW by 2025 goal. The new distributed solar goal aligns
with the state’s aim of getting 70% of its electricity from
renewable energy by 2030.
In the state of Nevada, Primergy Solar is developing the
giant US$1.2bn Gemini solar and storage energy
project. The complex, set to be the country’s largest ever solar development, will be made up of a 690MW
capacity PV plant and a 1,416MWh (380MW) battery energy storage system (ESS). It is expected to come
online in late 2023 or early 2024.
California targets 25.5GW of new renewable energy
capacity and 15GW of new storage and demand
response resources by 2032. The construction of the
Oberon Solar Project, for instance, has been approved,
which will generate up to 500MW of renewable energy
and have 200MW of battery storage capacity.
The move
follows the approval of Clearway Energy Group LLC’s
Arica and Victory Pass solar projects in Riverside
County, with a combined power generation capacity of
465MW and up to 400MW of battery storage.
Alliant Energy Corporation has started commercial
operations of a 50MW solar park in Richland County,
Wisconsin, US. The Bear Creek Solar project is the
company's first utility-scale solar farm as part of a plan
to deploy more than 1GW of utility-scale solar energy at
12 sites across Wisconsin. Three additional projects are
expected to go into service later this year.
Georgia Power is seeking approval to add 2.3GW of
renewable energy capacity this year under a broader
plan to expand its renewables resource portfolio to
11.5GW by 2035. The 2.3GW of new capacity is
intended to help Georgia Power double its renewable
energy generation resources by adding 6GW by 2035.
Prospect14 has partnered with a group of energy
investors to launch Ampliform, a joint venture that will
originate, develop, build, operate and optimise utility scale solar and solar and storage projects in the US.
The JV plans to develop more than 10GW of solar
projects in North America by 2025.