EV Consumer Preferences for Critical Mineral Mining: The Role of State-level Mining Activity

• In Event: Critical Minerals, EV Adoption, and Clean Energy Demand

Abstract

Electric vehicles (EVs) are central to decarbonization, yet their production generates significant social and environmental externalities through critical mineral extraction. As U.S. policy has sought to address supply chain vulnerabilities by encouraging domestic mining of critical minerals, new mines have been proposed and fast-tracked across states with substantial mineral reserves (Arizona, Arkansas, California, Nevada, and Utah). This creates unequal geographic exposure to mining harms across states and in turn, shapes the preferences of EV consumers in these states. Consequently, policies that onshore critical mineral mining without directly addressing its harms, risk dampening EV demand and impeding the pace of the energy transition. However, while prior studies have shown consumer preferences for avoiding such mines and their harms in traditional mineral-producing countries in the Southern Hemisphere, such preferences in countries now turning to mining, such as the U.S., remain unexplored.

To address this gap, we examine whether U.S. EV consumers exhibit a “NIMBY” preference for mining-related harms? Specifically, do consumers exhibit a willingness to pay (WTP) to avoid such harms in domestic locations they value, whether due to proximity or personal significance. Additionally, exploiting state level variation in mining activity we also study whether these preferences vary across the uneven landscape of state mining activity and policy.  We collected stated-preference survey data from 791 U.S. individuals who purchased or leased an EV in the past five years. One novel feature of our survey is a randomized application of two pre-treatment arms: (a) information about global mining impacts or (b) U.S.-specific information paired with a map of proposed mining sites overlaid with National Parks, National Forests, and biodiversity hotspots. This design allows us to test whether locally framed information, and spatial context such as state-level mining shift preferences for avoiding extraction. To our knowledge, no prior EV-focused DCE combines experienced EV buyers, explicit social–environmental harm attributes, and a NIMBY information treatment.

Using a mixed logit and a latent class model, we estimate how vehicle price, performance, and features of the mining process impact the consumer’s EV purchasing. Leveraging consumer awareness of potential mining sites due to the information treatment and respondent location data, we test for a NIMBY effect. Initial findings indicate a positive WTP to avoid mining near U.S. National Parks and biodiversity hotspots, and consumers in states with proposed mines are willing to pay more for EVs containing minerals sourced outside the U.S., suggesting a strong NIMBY effect. These results suggest that EV consumers value reductions in domestic mining externalities and are willing to pay to avoid siting harms near locations of high-amenity and biodiversity. As federal involvement in regulating mining declines and states begin to consider developing their own policies, this empirical evidence provides timely insights into the implications such policies may have for state citizens and broader clean energy trajectories.

Author

• Mokshda Kaul, University of Wisconsin-Madison
  Presenting Author