A Review of the Sustainability of Helium: An Assessment of its Past, Present, and Zero-Carbon Future

Research by: Stephen Wilkinson & Florian Gerth

Executive Summary

The paper delves deeply into the economic challenges surrounding the helium industry, particularly in the context of global efforts to reduce carbon emissions. The economic aspect of the helium market is central to the paper, focusing on the implications of helium scarcity, price fluctuations, and supply disruptions on industries reliant on this non-renewable resource.

Helium, primarily extracted as a by-product of natural gas, faces significant economic challenges due to the anticipated decline in fossil fuel consumption. As countries move toward net-zero carbon emissions, the reduction in natural gas production directly impacts helium availability, leading to supply shortages. This creates an economic paradox: while the reduction in fossil fuel use aligns with environmental goals, it threatens industries that depend on helium, such as medical imaging (MRI), aerospace, and quantum computing. The paper highlights that the helium market is characterized by price volatility and geopolitical risks, exacerbated by actions such as Russia’s 2022 ban on helium exports to unfriendly nations. The U.S., once a dominant player in helium production, has privatized its helium industry, leading to a more market-driven supply model. This privatization has introduced new economic pressures, with private firms driving prices higher in response to fluctuating supply.

As helium becomes scarcer, industries are exploring alternatives or investing in more efficient usage, but these solutions are either technically unfeasible or prohibitively expensive in the short term. For instance, atmospheric extraction of helium, while technically possible, is economically unviable due to the high costs associated with the process.

The paper concludes that the future of the helium industry is economically unsustainable without significant innovation or policy intervention. Rising helium prices, coupled with geopolitical tensions, are likely to lead to further economic disruptions, particularly in scientific research and high-tech industries. Additionally, while there are potential substitutes for helium in some applications, these alternatives do not completely address the economic challenges faced by industries that rely on helium.

Major Points:

• Helium Dependency on Fossil Fuels: Helium is economically tied to natural gas production, and the decline in fossil fuel use will make helium extraction more expensive, leading to supply shortages and higher prices.
• Geopolitical and Market Forces: Geopolitical actions, like Russia’s export bans, and the privatization of the U.S. helium industry, have introduced price volatility and supply instability, driving prices higher and creating economic uncertainty.
• Price Volatility and Impact on Industries: Helium shortages result in significant economic challenges for industries that rely on helium, such as healthcare (MRI) and quantum computing, where price hikes affect innovation and operations.
• Economic Feasibility of Alternatives: While technological developments such as atmospheric extraction of helium are possible, they are economically unviable due to high costs, making the transition away from helium expensive.
• Need for Policy Intervention: Without government intervention or significant innovation, the helium industry’s future is economically unsustainable, with rising costs threatening industries reliant on helium.

Keywords: fossil fuel transition; helium; sustainability

To cite this article:   Wilkinson, S., & Gerth, F. (2024). A review of the sustainability of helium: An assessment of its past, present, and a zero-carbon future. Regional Science and Environmental Economics, 1(1), 78–103. https://doi.org/10.3390/rsee1010006

To access this article: https://doi.org/10.3390/rsee1010006

About the Journal

Regional Science and Environmental Economics (RSEE) (ISSN 3042-4658) is the development and application of theories and methods to regional studies and environmental economics issues and problems. The journal publishes original research spanning the economic, social, and political dimensions of urban and regional change, as well as resource and environmental economics.

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