With the introduction of Modern Slavery legislation in Australia and with it a requirement to report publically on the risk of Modern Slavery in supply chains, a key modern slavery risk for energy companies lies within the cobalt used in batteries. The labour required to mine and supply cobalt is often characterised by modern slavery practices such as forced labour, and the worst forms of child labour.
Reliable energy storage for renewables energy producers is key, and batteries can be a reliable solution. South Australia is building a $1 billion solar farm and battery project and plans for several others to follow.1 These battery packs, like almost every other electronic devices on the market, use lithium-ion batteries.2 The key component contained within them, cobalt, makes the battery lighter, smaller, and more reliable than traditional lead-acid batteries. Such is the global demand that a 2.5 million tonne deficit is forecast for 2020.3 Some companies are going as far as securing a 10-year contract for cobalt supply in order to maintain reliable supply.5
Despite the market demand, cobalt operations are largely unregulated. Unlike gold, coltan and tin, cobalt is not covered under existing conflict mineral regulations such as the Securities and Exchange Commission’s disclosure requirements, which require companies to establish a due diligence program for suppliers.
Approximately 60% of the world’s cobalt is mined in the Democratic Republic of Congo (DRC), where a significant number of modern slavery instances, including human trafficking, coercion and exploitation, have been reported to be connected with the labour used in cobalt mining.5 Children as young as seven work in perilous conditions, particularly in informal or artisanal mines where cobalt is extracted from rocks by hand without protective equipment, for up to 12 hours a day. Many miners, both adults and children, later experience potentially fatal health effects from the prolonged exposure to cobalt dust. Violence from supervisors and mine collapses are common. Once mined, the cobalt passes “downstream” in the supply chain through traders, subcontractors, smelters and importers, before it reaches the manufacturer. The global and complex nature of this process means it is often several layers removed from the corporate purchaser and any modern slavery risks are obscured by the numerous and opaque supply chain links.