Newsom touts lithium development near Salton Sea, counters rural fears

California Gov. Gavin Newsom on Monday hailed the state's rapid transformation to renewables from a unique spot: a lithium processing project in impoverished Imperial County, at the state's sunbaked southern end that he and others say is part of a "transformational" industry that will bring good new jobs here while also preserving the environment for young people and aiding public health.

"We can do all of these things," he said. "This is one of the great economic transitions, one of the great economic opportunities to change the way we produce energy, to create clean energy ... and to reduce health care costs."

He brushed off concerns about global economic volatility and fears of massive renewables slicing through rural communities to power far-off cities, saying in an interview with The Desert Sun/USA Today that what is being done here is a template for vital, sustainable economic projects.

"There's a sense of urgency here," Newsom said, noting the latest, grim United Nations report on climate change released that morning. "This thing is happening, it's so much bigger than these situational things. ... We have a lithium technology that doesn't create any environmental impacts. ... the market is going to drive the investment."

Still, billions in private capital will be needed to construct full-scale facilities in a remote area with no paved roads, little Internet access and where summer temperatures reach blistering triple digits.

How lithium extraction works as opposed to mining, evaporation

Before Newsom spoke he toured a steam boiler, separation tanks and laboratory space at Controlled Thermal Resources' Hell's Kitchen 1 project site, near the south end of the Salton Sea. CTR and two other companies are refining extraction techniques to produce tons of lithium and other critical minerals used in electric vehicles, smart phones and large battery storage systems for renewables.

More: Lithium Valley: A look at the major players near the Salton Sea seeking billions in funding

Lithium prices have skyrocketed in the past few years, as California and others have set aggressive mandates to phase out gasoline powered cars.

The minerals here are pumped up as part of boiling hot brine from a vast underground reserve into a "closed loop" system, explained CTR chief executive officer Rod Colwell, with no hard rock mining, or the large evaporation pond techniques used in Central America. Instead, steam power is created by cooling the 550 degree brine, then lithium, manganese and zinc are separated out and the remaining brine is pumped back underground half a mile away.

While his company and two others are able to separate out the minerals, they need to drive down costs and perfect largescale production of usable metals from gritty brine that often clogs pipes and rusts new facilities. All will also require billions of dollars to build out facilities at commercial scale.

'We're as dumb as we want to be'

Newsom also brushed aside questions about bank collapses and takeovers in the Silicon Valley and elsewhere, saying if automakers don't address the supply chain issue to meet mandates here in the European Union and elsewhere, "they will collapse. That will transcend some of the short-term volatility. I'm not naïve about the short-term impacts, but it's all starting to take shape. They key is to test the technology, to prove the technology."

Holding a small container of high-grade lithium produced on site, he said the product was now in the "medium" price range, beating out hard rock mining costs, and was pushing to match overseas production.

While acknowledging a long history of unrealized promises in this hot desert corner, he also dismissed concerns of rural residents here and across the United States who are unhappy with huge solar farms, wind turbines and other renewables projects, saying a necessary transformation is underway that is critical to slowing "whiplash weather" and other climate change impacts.

"I think we should be a little bit more about a 1,200 year megadrought in the western Unites Sates, and the fact you can't even build communities because we have no water, groundwater depletion, the Colorado River drying up, the Rhine River drying, all part of the weather whiplash, and the billions of taxpayer dollars the people in Montana are paying to California for damage associated with storms."

He concluded, "I mean, we're as dumb as we want to be."

Prices also have come down sharply on electric vehicles, he said, targeting another frequent concern. Median annual household income in Niland, the nearest town, is $16,082 — a shocking contrast to $64,994 across the U.S. and $78,672 in California. Many see an electric vehicle as out of reach. His administration last year pushed through the Legislature a suite of measures to help lower prices for EVs in low-income communities, and those will not be touched, he vowed, despite the state's current $22 billion budget shortfall. The state air board also opened up a voucher program for community mobility and charging stations last week. All told, combined with federal funding and tax breaks, a total $27,000 has been knocked off the price of an EV for a low-income buyer, and more reasonable choices than a Tesla are quickly coming to market.

"We are stacking incentives for low-income communities," he said. He said he and his senior-level staff are also in constant communication with White House energy and climate officials, and are pushing for more federal funds.

"There's not a subnational government on planet Earth doing more to support this transition to electric (away from polluting fossil fuels."

Proving all politics is local

Newsom and area officials also vowed to fight efforts to place an initiative on a statewide ballot that could lead to voters overturning a new state tax that guarantees revenues from lithium development for residents and county government here, noting it is the first time a state tax will be returned 100% to an impacted area, with 80% flowing back to county and local governments and 20% earmarked to continue clean up and stabilization of the rapidly drying, heavily polluted Salton Sea.

"We've never had a process like this in state government....this is a model, a template," he said. Summarizing the obstacles, he said, "all these things are surmountable. There's a vison, there's a capacity, there's intensity ... and then there's a global market, a trillion dollar market that's transitioning. They need the resource."

CTR CEO Colwell, whose company fought the new tax last year, said he had no comment on the new initiative.

Newsom was joined by several area officials, including U.S. Rep. Raul Ruiz, a Democrat; Torres Martinez tribal chair Thomas Tortez; Assemblymember Eduardo Garcia, also a Democrat; Imperial County Board of Supervisors Chair Ryan Kelley; and heads of area environmental justice and community groups.

It was the last stop on his mobile "State of the State" address, in which he roved from San Quentin prison to San Diego and other stops, touting rehabilitation, affordable housing, mental health and other initiatives.

CORRECTION: An earlier version of this story wrongly attributed to Controlled Thermal Resources CEO Rod Colwell a specific location for hard rock mining of lithium.

Janet Wilson is senior environment reporter for The Desert Sun. She can be reached at jwilson@gannett.com or on Twitter @janetwilson66

This article originally appeared on Palm Springs Desert Sun: Newsom touts lithium development near Salton Sea, counters rural fears