Educational Video

Copper: The Essential Power Player in the Energy Transition


Video Transcript

Copper is Essential to Clean Energy

When it comes to electric power, copper’s essential role is unmatched. From the very first flicker of electric lights, to the rise of the digital age, to the transition to new power sources and the proliferation of electric vehicles, copper remains crucial.

With its high electrical and heat conductivity, copper can be found in the vast majority of today’s transformers, electrical wiring cores and conductors, and is a key component in the construction of renewable energy sources such as wind, solar, hydro, and thermal, as well as in electric vehicles.

As most of the world seeks to reach net-zero targets and transition to cleaner, renewable forms of energy, copper is a requirement. However, the amount of copper needed to successfully facilitate the energy transition is staggering. In fact, S&P Global has stated that “projected annual shortfalls will place unprecedented strain on supply chains.” And so, the race is on to produce enough copper to meet the ever-growing demand.

This may likely mean that both copper, and the companies that extract and produce it, could provide an attractive investment opportunity for those seeking alpha in their portfolios and a way to make an impact on the realization of the greener, net-zero emissions world.

Why Copper is Critical

Copper has a myriad of uses, and it wouldn’t be an overstatement to say that it is one of our most important resources. Used by people for thousands of years, copper continues to be used in nearly all facets of daily life. Nearly 70% of all copper produced is used in electrical applications1, which is why it’s so important to the energy transition.

Part of the reason copper is such a great conductor of electricity is due to its high free electron concentration. When a voltage is connected across copper, it pushes the free electrons and causes them to flow through the metal, creating an electrical current.

A material with a lot of free electrons is able to carry a current more easily than one with a smaller charge density. Because there are so many electrons in copper to carry the charge, they don’t need to move very fast. This means that they are much less likely to collide with atoms or impurities in the metal.

Copper also assists with improving something called the current rating, which is the current a cable is able to carry safely without overheating.

Copper has an array of other benefits when it comes to electrification, but with regard to renewable energy, copper really is an all-star. It helps to reduce CO2 emissions by lowering the amount of energy needed to produce electricity.2 The amount of copper required for most renewable energy systems is six times that of traditional energy systems.

Copper is also a critical component in the manufacturing of electric vehicles. While the average internal combustion engine vehicle contains approximately 48 pounds of copper, a typical EV contains nearly four times that amount.3

All of these factors, and even more than we have time for here, come together to paint a bright picture for copper and its role in the clean energy transition.

It’s projected that demand for copper may increase 58% by 2040, relative to 2022.4 However, the average grade of ore mined globally from existing mines has been declining as orebodies are depleted. This means that the development of new and emerging copper mines will be needed. As a result, copper mining companies—and perhaps newer copper mining companies, in particular—may be poised for growth.

Copper Mining May Be Well Positioned

Copper has been the reliable workhorse of the metals, having already facilitated untold innovations and set the stage for the modern world we enjoy today. Now, we believe it's time for this often-underappreciated commodity to ascend even further with the clean energy transition, where it likely may be destined to remain critical for decades to come.

As governments around the world continue to invest in meeting net zero carbon emissions goals, they are starting to acknowledge how vital raw materials are to reaching these goals. The EU has already proposed classifying copper as a critical raw material5 and among Canada's 31 critical minerals, six are initially prioritized by the government for their potential clean energy impact, including copper6.

As more and more countries start to understand just how much copper is needed for electrification, there could be a push to accelerate copper mining and processing.

Copper miners may be well positioned to benefit from increased investment in the low-carbon and renewable energy sector and may offer an attractive opportunity to investors seeking access to copper through companies that are upstream in the supply chain.

Sprott Energy Transition ETFs are designed to give investors access to critical minerals such as copper, among many others, that are driving the global energy transition. To learn more, please visit the website or call 888.622.1813.


1 Source: Copper Alliance, 2023.

2 Source: Copper Alliance, 2023.

3 Source: ThinkCopper. and Navigant Research. Global Copper Outlook 2022-2040, BloombergNEF.

5 Source:Bloomberg, March 2023.

6 Source: The Canadian Critical Minerals Strategy,, 2022.


Special Note: Jesse Day is not an employee or an affiliate of Sprott Asset Management LP. The opinions, estimates and projections ("information") contained within this content are solely those of the presenter and are subject to change without notice. Sprott Asset Management LP makes every effort to ensure that the information has been derived from sources believed to be reliable and accurate. However, Sprott Asset Management LP assumes no responsibility for any losses or damages, whether direct or indirect, which arise out of the use of this information. Sprott Asset Management LP is not under any obligation to update or keep current the information contained herein. The information should not be regarded by recipients as a substitute for the exercise of their own judgment. Please contact your own personal advisor on your particular circumstances. Views expressed regarding a particular company, security, industry or market sector should not be considered an indication of trading intent of any investment funds managed by Sprott Asset Management LP. These views are not to be considered as investment advice nor should they be considered a recommendation to buy or sell.

Important Disclosures & Definitions

An investor should consider the investment objectives, risks, charges, and expenses carefully before investing. To obtain a Sprott Junior Copper Miners ETF Statutory Prospectus, which contains this and other information, visit, contact your financial professional or call 888.622.1813. Read the Prospectus carefully before investing.

The Fund is not suitable for all investors. Investors in the Fund should be willing to accept a high degree of volatility in the price of the Fund's shares and the possibility of significant losses. An investment in the Fund involves a substantial degree of risk. The Fund is considered non-diversified and can invest a greater portion of assets in securities of individual issuers than a diversified fund. As a result, changes in the market value of a single investment could cause greater fluctuations in share price than would occur in a diversified fund.

Shares are not individually redeemable. Investors buy and sell shares of the Sprott Junior Copper Miners ETF on a secondary market. Only market makers or "authorized participants" may trade directly with the Fund, typically in blocks of 10,000 shares.

Funds that emphasize investments in small/mid-cap companies will generally experience greater price volatility. Diversification does not eliminate the risk of investment losses. ETFs are considered to have continuous liquidity because they allow an individual to trade throughout the day. A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses, affect the Fund’s performance.

The Sprott Junior Copper Miners ETF seeks to provide investment results that, before fees and expenses, generally correspond to the total return performance of the Nasdaq Sprott Junior Copper Miners™ Index (NSCOPJ™).

Nasdaq®, Nasdaq Junior Copper Miners™ Index, and NSCOPJ™ are registered trademarks of Nasdaq, Inc. (which with its affiliates is referred to as the “Corporations”) and are licensed for use by Sprott Asset Management LP. The Product(s) have not been passed on by the Corporations as to their legality or suitability. The Product(s) are not issued, endorsed, sold, or promoted by the Corporations. THE CORPORATIONS MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO THE PRODUCT(S).

Sprott Asset Management USA, Inc. is the Investment Adviser to the Sprott Junior Copper Miners ETF. Sprott Asset Management LP is the Sponsor of the Fund. ALPS Distributors, Inc. is the Distributor for the Sprott Junior Copper Miners ETF and is a registered broker-dealer and FINRA Member.

ALPS Distributors, Inc. is not affiliated with Sprott Asset Management LP.


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