Prices behind electro-mobility: Contestation around and beyond price determination and setting in the lithium global production network and extraction in Chile

Against the background of political and academic debates around strategies to slow down global warming, the shift to electro-mobility is broadly perceived as a key strategy, particular in the Global North but also countries such as China. There are high expectations in electric vehicles (EVs) and the prevailing technology of lithium-ion batteries which demand a rapid increase of its main component lithium. A growing body of literature thereby focuses on the problematic socio-ecological impacts of lithium extraction. However, despite the current peak in lithium prices, limited attention has been put on the role of prices and pricing in research and policy circles around green extractivism. In contrast to the premise of prices simply being an output of supply and demand in abstract markets - an assumption propagated by neoclassical thinking - prices and price determination must be seen as politically, socially, and culturally embedded. Price determination procedures are contested processes taking place in an environment of competition and are (re-)producing status, power and trust that have distributional impacts. Based on 22 interviews with lithium sector stakeholders and experts in Europe and Chile, one of the main lithium producing countries worldwide, this thesis assesses the contestation around and beyond price determination and setting processes in lithium extraction in Chile and the lithium global production network. Currently, price determination in the lithium market is rather opaque and there is not one world price to be used throughout the industry. These opaque contracts and prices stabilise the power of producers in the production network of lithium. At the same time powerful price determination institutions like the London Metal Exchange (LME) and Price Reporting Agencies (PRAs) follow practices that lack transparency, and often pursue rather short-term strategies instead of considering long-term risks and costs like ecological degradation. How and by whom (lithium) prices are determined has important distributional outcomes as this process includes social and environmental concerns and questions of representation and inclusion in decision-making processes. The complex political economy in Chile, social injustices and fights over territories furthermore structure the socio-cultural realities of lithium extraction and influences global trade patterns. The control of lithium extraction by only two companies, strengthens their position in price determination processes on a global level and together with a political system in Chile where almost all power originates from the centre weakens the opportunities of alternative production systems and critical voices towards the model of green exractivism. Generally, the high demand for lithium induced by a certain narrative about a socio-ecological transformation can foster the unsustainable use of lithium.