- Nickel mining is a critical part of the electric vehicle battery supply chain, but it is associated with serious environmental destruction and human rights violations.
- Social and environmental impacts, including the loss of livelihoods, deforestation, and water and air pollution, are spreading in affected communities.
- Responsible policies and corporate changes are essential for long-term and comprehensive solutions.
February 12, 2025, Jakarta
Indonesian and Korean civil society organizations have published the Indonesian-language version of the report “Battery Extracted”, which highlights environmental and social issues in the upstream supply chain of electric vehicle (EV) batteries and the investment activities of Korean companies in Indonesia. The report is based on a field investigation conducted in July 2024 at a nickel mining site in Lameruru Village, Langgikima district, North Konawe regency, Southeast Sulawesi.
As the electric vehicle market rapidly expands as a key solution to the climate crisis, the demand for lithium-ion batteries has surged. Lithium, cobalt, and nickel—essential for the production of these batteries—are classified as “transition minerals” due to their critical role in energy transition technologies. However, in the areas where these minerals are extracted, serious environmental destruction and human rights violations are occurring.
The demand for nickel, which plays a crucial role in improving the energy density and lifespan of lithium-ion batteries, is expected to increase 40-fold by 2040. Indonesia, which accounts for about 50% of the world’s nickel production, has emerged as a major supplier. However, the mining and refining processes have resulted in large-scale carbon emissions, deforestation, expansion of coal-fired power plants, loss of biodiversities, water and air pollution, as well as land grabbing, loss of traditional livelihoods, and violations of rights of women and children, as well as water rights for local and indigenous communities.
Kisran Makati, Director of PuSPAHAM, expressed deep concern, stating, “Local communities are losing their long-standing traditional way of life due to nickel mining. In the past, they grew their own food and fished for sustenance, but now they rely on external vendors for basic goods. Only a small number of people earn an income from working in the mines, and when the mines shut down, they are left with devastated forests and polluted environments. Physical repression against residents who resist the mines is also a serious issue.”
Kurniawan Sabar, Director of INDIES, emphasized, “While electric vehicles are promoted as environmentally friendly, behind the scenes lie environmental destruction and the sacrifices of local communities. What we need for a sustainable future is not more cars but a fairer use of resources and environmental preservation. In countries such as Indonesia, it should rely on the principles of genuine land reform.”
Meanwhile, policy efforts to prevent and address environmental and social issues in the upstream EV supply chain remain insufficient. Major countries, including Korea, focus on protecting and promoting their domestic EV industries, providing subsidies and securing mineral resources.
Shin-young Chung, Director of the Advocate for Public Interest Law (APIL), highlighted the importance of legislating human rights and environmental due diligence laws, stating, “It is essential to identify and address human rights and environmental issues within corporate supply chains to respond to the problems associated with transition mineral production. Stakeholder participation must be guaranteed, and a legal foundation for communication and response should be established through human rights and environmental due diligence laws.”
Korean companies' investment in Indonesia’s nickel industry is steadily increasing, with investments ranging from mining to battery and vehicle manufacturing. In the second quarter of 2024 alone, Korean companies invested approximately $1.3 billion in Indonesia, representing a 1,200% increase compared to the same period in the previous year. Major companies continue to announce new investment plans in mining and refining facilities.
Hyelyn Kim, Head of the Climate Ocean Research Institute (CORI), stressed, “Korean companies must acknowledge these challenges and ensure their operations minimize environmental and social impacts on local communities. The Korean government should go beyond support for overseas resource development but also establish robust mechanisms to identify and address companies linked to human rights and environmental violations.”
The organizations concluded by stating their commitment to continuously investigate the destructive environmental and social impacts of nickel mining in Indonesia, conducted in the name of energy transition, and to advocate for changes in corporate and government practices through international solidarity activities.
We, civil society organizations from Indonesia and South Korea, express our growing concern about the human rights and environmental impacts stemming from nickel production.
Nickel, a critical component of the electric vehicle battery supply chain, is primarily mined in Indonesia. As of 2023, Indonesia accounted for nearly half of global nickel production, with a significant portion of this mining concentrated in Southeast Sulawesi. For centuries, local communities in this region lived sustainably through fishing and farming. However, the rapid expansion of nickel mining has profoundly disrupted their traditional way of life, bringing environmental degradation and economic hardship.
In mining areas, deforestation and pollution are increasing, threatening the livelihoods of local communities. Waste from mining and smelting processes has severely polluted coastal waters, decimating marine ecosystems and depriving fishing communities of their primary source of income. Many are left with no choice but to depend on compensation from mining companies, which often proves insufficient—leaving them trapped in cycles of poverty.
Nickel mining has also exacerbated the risk of natural disasters. In North Konawe, Southeast Sulawesi, deforestation has left the region increasingly vulnerable to floods. Annual flooding causes significant damage to local communities, worsening their living conditions and further highlighting the long-term consequences of unregulated resource extraction.
The Indonesian government is pursuing policies to promote downstream development in the nickel industry, aiming to boost domestic processing. However, emissions from smelting plants and coal-fired power stations have led to dangerous levels of air pollution, posing serious threats to public health. Furthermore, the expansion of these operations has resulted in land grabbing and water shortages, in many cases without obtaining the free, prior, and informed consent (FPIC) of affected communities.
Meanwhile, South Korean corporations are increasing investments in securing raw materials for EV battery production and expanding battery manufacturing. Although the South Korean government has introduced various policies to support overseas resource development companies, it has taken no action to address the human rights and environmental issues occurring within their supply chains. Therefore, it is crucial for the South Korean government to actively promote the enactment of a ‘Supply Chain Human Rights and Environmental Due Diligence Law’ to prevent and respond to such issues effectively.
We demand that the governments and corporations of Indonesia and South Korea take the following actions:
- Adopt policies to strengthen public transportation and reduce the number of vehicles by promoting alternative transportation options
- Enact legislation in South Korea to ensure that all companies in the EV battery supply chain conduct human rights and environmental due diligence and are held accountable for preventing and addressing any violations.
- Implement moratorium on issuing mining permits, especially for nickel extraction in Indonesia followed by urgent review and evaluation of national policy and plan on nickel mining and “downstreaming” industry development.
- Ensure implementation of post-mining reclamation policy and environmental recovery affected by nickel mining and smelter industry in Indonesia.
- The Indonesian government should strengthen law enforcement strictly on addressing the illegal and bad mining practices, ensuring accountability on deforestation, environmental degradation, human rights violations and remedy for affected communities, peasants, fisherfolk, women and indigenous people.
We recognize that electric vehicles alone do not guarantee a sustainable future. Addressing the root causes of the climate crisis requires acknowledging the broader impact of resource extraction on vulnerable communities and ecosystems. Nickel mining, which disrupts the lives of these communities and contributes to significant climate and environmental impacts, highlights the urgent need for more responsible and inclusive approaches. Countries committed to combating the climate crisis must ensure that human rights and environmental standards are upheld throughout their supply chains. Real climate solutions prioritize both people and the planet, ensuring accountability and long-term resilience.