The Hunt for a New Kind of Magnet to Power the Future | Bloomberg Primer

Key Concepts

• Permanent Magnets
• Rare Earth Metals (Neodymium)
• Supply Chain Concentration (China)
• Iron Nitride Magnets
• Superconducting Magnets
• Nuclear Fusion
• Tokamak Reactors
• High-Temperature Superconductors (HTS)

The Ubiquity and Importance of Magnets

Magnets are essential to modern life, found in devices like hard drives, cell phones (speakers, microphones, vibrating motors, camera lens stabilization, circuit boards), and are becoming increasingly important for clean energy technologies. The multi-billion dollar magnet industry is key to transitioning away from fossil fuels.

Magnets in Clean Energy Technologies

• Electric Vehicles (EVs): Permanent magnets are crucial for EV motors. Electricity flowing into a metallic shaft creates a magnetic field, which interacts with the magnetic fields of permanent magnets, causing the shaft to rotate and power the vehicle.
• Wind Turbines: The process is reversed in wind turbines. The movement of the blades spins a magnet around a central wire, generating an electric current and producing electricity.

The Rare Earth Metal Problem

Most permanent magnets used in clean energy technologies rely on rare earth metals, particularly neodymium. 92% of the world's rare earth magnets are sourced from China, creating a supply chain vulnerability.

• Rare Earth Metal Scarcity: Rare earth metals are found in trace amounts in the earth's crust (a few parts per million).
• China's Dominance: China has invested heavily in building a complete rare earth metal supply chain, from mining to final product manufacturing, making it difficult for other countries to compete.
• Geopolitical Risks: China's dominance gives it pricing power and exposes other countries to policy swings. The 2010 incident involving a Chinese vessel and the Japanese Coast Guard demonstrated this vulnerability when China allegedly threatened to cut off rare earth metal supplies to Japan, causing prices to skyrocket.

Efforts to Diversify Rare Earth Metal Supply

• European Initiatives: Europe is exploring local sources of rare earths, such as a large deposit in Norway. However, establishing a new supply chain is challenging due to permitting issues, community concerns, and high costs (e.g., approximately 1 billion euro for the first phase of the Norwegian mine).
• Slow Development: The pace of developing new rare earth mines globally has been slow, making it difficult to compete with China.

Iron Nitride Magnets: A Rare Earth-Free Alternative

Jian-Ping Wang at the University of Minnesota has been developing iron nitride magnets, which use abundant elements (iron and nitrogen) and eliminate the need for rare earths.

• Challenges: Finding a stable molecular structure for iron nitride is difficult.
• Niron Magnetics: Jian-Ping Wang founded Niron Magnetics, which has secured over $100 million in funding to scale up production of iron nitride magnets.
• Nanoparticle Approach: Niron uses a nanoparticle approach, starting with iron oxide nanoparticles (engineered rust) and processing them into iron nitride. The powder is then aligned into chains or needles to achieve the desired structure.
• Target Markets: Niron's initial target market is audio (speakers, guitar pickups). The company has also raised over $30 million from car makers like GM and Stellantis, who are interested in using iron nitride for EVs in the future (3-5 years).
• Drawbacks: Iron nitride magnets have lower coercivity (resistance to demagnetization) compared to rare earth magnets, which can be a problem in applications like motors where the magnet experiences other magnetic fields.

Superconducting Magnets and Nuclear Fusion

Commonwealth Fusion Systems is developing fusion technology using high-temperature superconducting (HTS) magnets.

• Nuclear Fusion: Nuclear fusion replicates the sun's energy production by compressing hydrogen to make helium, releasing energy.
• Tokamak Reactors: Tokamak reactors use magnets to contain superheated hydrogen plasma (100 million degrees Celsius).
• Superconducting Magnets: Superconductors have zero electrical resistance, allowing them to carry current without generating heat, making them more efficient than copper electromagnets.
• High-Temperature Superconductors (HTS): HTS materials can operate at higher temperatures (though still very cold) than traditional superconductors, allowing for smaller and more powerful magnets.
• Commonwealth Fusion Systems: Commonwealth uses HTS magnets to build smaller, cheaper, and faster fusion reactors. Their magnets are strong enough to lift an aircraft carrier.
• Magnet Production: Commonwealth has a magnet production line where they create "pancakes" (layers of the magnet) using superconducting tape.
• Investment: Private investment in nuclear fusion has increased significantly in recent years, with firms like Breakthrough Energy Ventures (Bill Gates) investing heavily in companies like Commonwealth Fusion Systems.
• Challenges: Nuclear fusion still faces challenges, including demonstrating net power production (producing more power than consumed) on a commercial scale.

Conclusion

Magnets are critical for modern technology and the transition to clean energy. The rare earth metal supply chain presents a geopolitical challenge, driving innovation in alternative magnet materials like iron nitride and advancements in superconducting magnets for fusion power. While challenges remain, the ongoing evolution and improvement of magnet technology hold the potential to create significant economic and environmental impact.