This month, oil giant Exxon Mobil announced its intention to produce lithium in defunct Arkansas oil fields by 2027. Exxon’s bet on a growing demand for lithium is probably a good one—so long as U.S. federal policy continues to pump demand for electric vehicles (EVs), solar, and other “green” technologies that need lithium for batteries.

Lithium, a key component of EV batteries, will be needed in massive quantities if the Biden administration’s “green transition” is ever to come to fruition. Exxon’s exploration in lithium comes at the same time as the company predicts that “plug-in hybrids, battery electric and fuel cells will grow to about 44% of the fleet (920 million) and more than 50% of new car sales,” by 2050, in part driven by “policies to reduce tailpipe emissions.” No doubt, Exxon is looking toward the Inflation Reduction Act’s enormous and potentially “indefinite” subsidies for renewable energy as a clue toward future U.S. energy policy. 

There is only one active lithium mine in the U.S.—the Silver Peak mine in Nevada—but others have been delayed or stymied by lengthy permitting processes. The owners of a newly discovered lithium deposit in Maine worth up to $1.5 billion are facing years of permitting applications amid a strict state regulatory environment. 

Streamlining environmental review processes would support an all-of-the-above energy strategy that is responsive to the needs of local communities. Producing natural resources domestically, including “critical minerals” like lithium, lessens U.S. dependence on foreign countries with lax environmental standards and blatant disregard for labor and human rights abuses. 

However, the Biden administration’s haste to permit 25 gigawatts of new renewable energy projects by 2025 risks green-lighting renewable projects that could cause significant environmental damage while thwarting every proposed oil, gas, and nuclear project, no matter how safely done. What’s worse is that EVs may not lower greenhouse gas emissions much, if at all, given the emissions released in mining battery materials.

Special favors, in the permitting process or in the form of subsidies and tax credits, distort markets and leave consumers to bear the brunt of expensive, unreliable energy. ExxonMobil is betting that U.S. policy will continue to subsidize booming demand for battery minerals; yet in October, it closed a $60 billion deal to acquire Pioneer Natural Resources’ fossil fuel operations in the Permian basin. Perhaps ExxonMobil also envisions an all-of-the-above strategy for U.S. energy security—or is simply hedging its bets on both sides of the renewable energy debate.