The ocean floor as a common pool resource

The ocean floors are scattered with trillions of lumps of 'critical' minerals, ​​​​​​​which are key to the world’s transition to renewable energy. Nickel, copper, cobalt, and manganese are vital​​​​​​​ inputs for the batteries needed for solar panels, wind turbines, and electric cars.​​​​​​​

The sea bed is a good example of a common pool resource. Without government or intergovernmental intervention, minerals from the sea bed can be accessed without restriction—it is non-excludable. Once mining firms harvest the minerals from the sea bed, they are not available to other mining firms—it is rivalrous. 

Intergovernmental intervention exists on the ocean floor through the International Seabed Authority(ISA), a United Nations body regulating the seabed. The ISA is trying to work out how the sea bed mining can be controlled. It will not be an easy regulation framework to set up with so many power mining businesses and governments, seeing the opportunities the mining rare earth brings in terms of profits and control of the renewable energy sector. 

According to the International Energy Agency, the demand for 'critical' minerals is forecast to double in the next 20 years. The significant growth of the renewable energy sector drives this. Up to now, mining businesses have focused their attention on obtaining rare earth metals in China, Vietnam, Brazil and Russia. There are also important sources in Africa, such as the Democratic Republic of Congo, South Africa and Gabon. The problem for mining businesses is that national governments tend to be very protective of their reserves, and political instability in some nations can make their mining operations challenging. Mining on the sea is an attractive alternative.

Harvesting minerals from the sea bed has its own challenges. Mining the ocean floor in deep seas involves robots that hoover up minerals in lumps known as nodules, which are then piped up to a support ship. The lack of visibility and high pressure on the sea bed makes harvesting difficult and expensive, but the technology is improving. 

Mining on the ocean floor has environmental costs. Harvesting minerals disrupts the sea bed, creates sedimentary plumes, and involves significant underwater noise, which is incredibly destructive to aquatic life habitats. 

Trillions of dollars of minerals are waiting to be harvested by the world's mining companies. The success of this new source of minerals is critical to the electrification of the global economy, which countries need to achieve to become carbon neutral.

Some possible points to discuss with a class

1. Why is the ocean floor considered to be a common pool resource?

2. Why are the 'critical' minerals on the ocean floor important in the energy market?

3. What are the negative externalities associated with mining on the ocean floor?

4. How effective do you think the International Seabed Authority(ISA) might be in correcting the market failure associated with mining on the ocean floor?