Hybrid and electric cars often contain as many as eight different rare earths. ... And that's where the real environmental problems begin. Mines in China have a particularly terrible record of contamination. Communities around a former rare earths mining operation in Inner Mongolia, for example, blame hundreds of cases of cancer on leaked radioactive waste from the mine, and local people complain that their hair has gone white and their teeth have fallen out.

Right now, our most likely non-domestic rare earths source is an Australian company called Lynas. Although the company will mine its materials in Australia, it hopes to build its refinery in Malaysia. This idea is controversial among Malaysians, to say the least. Some suspect that Lynas is choosing to refine in Malaysia in order to sidestep more stringent environmental regulations. "If they had built the Australia, it would have been a lot more expensive and difficult to permit than in Malaysia," says Jon Hykawy, an analyst with the Toronto-based brokerage Byron Markets, which specializes in rare earths.

It's understandable that Malaysians would be wary of Lynas' plans, given the nation's history with rare earths. In the jungled interior of the country, a mine owned by Mitsubishi had a major spill in 1992. In the years since, nearby villagers have seen high rates of birth defects and eight cases of leukemia. And Mitsubishi is still dealing with the mess: The New York Times recently called it "the largest radiation cleanup yet in the rare earth industry."

This creates a real dilemma: What good is green technology if it's based on minerals whose extraction is so, well, ungreen? Most of the experts that I talked to agreed that the elements are just too useful to give up on. "We need this stuff," says Jim Kuipers, an independent mining consultant in Montana. "It's just a matter of figuring out how to do it right, and unfortunately, the mining industry doesn't have a strong history of doing this."