The global transition to low-carbon energy is spurring new momentum to produce and secure the mineral inputs necessary for renewable technologies. Yet meeting demand may prove difficult. From electric cars to wind turbines, essential renewable energy technologies often require more minerals than fossil fuel-powered infrastructure. The International Energy Agency (IEA) projects that efforts to meet the goals of the Paris Agreement could lead to a fourfold increase in mineral demand by 2040.

A recent wave of policy developments reflects this sharpening focus on critical mineral supply chains: The US Inflation Reduction Act, the multilateral Mineral Security Partnership, the European Union’s Critical Raw Materials Act, the new EU Batteries Regulation, Zimbabwe’s export ban on unprocessed lithium, and others.

Earlier this month, the Wilson Center’s Environmental Change and Security Program convened a roundtable discussion on critical minerals at the Berlin Climate Security Conference, which was hosted jointly by adelphi and the German Foreign Federal Office. The session focused on assessing the evolving landscape of critical mineral policies—and what it means for different players in the global energy transition.

Global Partnerships Help Secure Supply Chains with Higher ESG Standards

Kate Guy, Senior Advisor at the US Department of State, noted that “the US government has made it very clear that clean energy is our future. For that to happen, though, we know we will have to build technologies that require critical minerals.” A key question, she continued, is how we can get the supplies that we need in a way that is safe, environmentally conscious and inclusive of local communities.

The US and its partners see one answer to that question in the Mineral Security Partnership (MSP) launched in 2022. As a founding member of the MSP, the US government has joined 12 countries and the EU to catalyze critical mineral projects across the mineral lifecycle—from extraction to recycling.

Guy pointed out that two central goals of the partnership are developing diverse and stable global critical mineral supply chains and boosting recycling capacity for critical minerals. The MSP also seeks to promote high environmental, social and governance (ESG) standards within the mining, processing and recycling sectors of those minerals supply chains. “This includes ensuring safe, fair, inclusive and ethical conditions in workplaces,” she noted.

The partnership is also making sure that the local communities involved in critical mineral mining, processing, and recycling receive tangible benefits. “While we focus on the build-out of the supply chains,” said Guy, “we [also] really need to focus on demonstrating responsible stewardship of the natural environment, and engaging in consultative and participatory processes around land access and acquisition.”

EU Initiatives to Tackle Critical Mineral Risks

The EU has pushed forward a series of other policies beyond its participation in the MSP to ensure it has a stable future supply of critical minerals necessary to meet its binding commitment to achieve climate neutrality by 2050.

Most notably, in March 2023, the bloc adopted the Critical Raw Materials (CRM) Act, said Helge Elisabeth Zeitler, Deputy Head of the Global Resources, Deforestation, and Water unit of the Directorate General for Environment at the European Commission. Zeitler observed that the EU is in process of creating “Critical Raw Materials Club” with “like-minded” countries to strengthen supply chains as part of that Act.

Zeitler added that the Act also includes stipulations on diffusion and self-reliance in mineral production. No more than 65% of any given strategic mineral consumed by the EU annually can come from one single country, for instance. The EU also must produce 10% of the strategic minerals it consumes every year.

But ramping up mining in Europe will be challenging, she noted. “People have gotten used to saying that it’s coming from somewhere else and leaving all the potential environmental and social consequences to be felt somewhere else,” Zeitler explained. “Bringing that back to Europe is not an easy sell to the public.”  

The EU is pursuing other mineral-related initiatives in parallel with the CRM. In March 2022, the European Commission published the Circular Economy Package, which Zeitler said includes significant due diligence requirements for minerals sourced outside the EU. And in response to the US’ Inflation Reduction Act, the EU is negotiating an agreement to become a beneficiary of the IRA’s subsidies linked to critical mineral sourcing. 

A Pathway for an African Green Mineral Strategy

African countries are key players in this conversation as well. The continent of Africa is home to 30 percent of the world’s mineral reserves, including key transition minerals like platinum, chromium, cobalt, copper and many more. But Africa also continues to have major energy access gaps: more than 600 million people on the continent still lack electricity.

Dhesigen Naidoo, Senior Research Associate at the Institute for Security Studies in South Africa, urged more critical thinking about who is benefiting from critical mineral mining and other green energy investments. Paraphrasing Carlos Lopes, the former executive secretary for the United Nations Economic Commission for Africa, Naidoo said that “African minerals in particular have been instrumental in propping up the development trajectory of the Global North without getting sufficient benefit [for Africa] from it.” And as we enter a global economy dominated by renewable energy, he warned that we “run the risk of doing that all over again.”

That possibility makes it essential to understand how leaders from Africa are thinking about these issues. How can we ensure that mineral-producing countries in the Global South participate as equals in the global energy transition? Naidoo suggested that a 2022 approach paper by the African Development Bank and the African Natural Resources Management Research Center offers some guidance.

The paper elucidates a pathway for an “African green mineral strategy” built on four pillars. The first two pillars are creating local investment in geological knowledge and developing “people and technology capabilities” in the critical minerals sector, including through skill-building and technological innovation. Naidoo saw the first pillar as especially significant “because most of Africa has not relied on local capacity around geological knowledge in the past.”

The paper’s third pillar calls for moving up the value chains beyond raw mineral exports, while the fourth pillar advocates advancing responsible minerals stewardship by furthering environmental, social and governance aspects of critical mineral mining and increasing reuse and recycling.

“One of the desires for the continent of Africa, as in many other places in the world,” said Naidoo, “is to have a reasonable level of local beneficiation, and a much wider value chain than has been the case before.” If countries mainly export raw mineral resources and lack the infrastructure and investments for mineral processing and clean tech manufacturing, he explained, they have to buy back renewable technologies at higher prices.

Advancing Coalitions to Counter Growing Distrust

Jewellord (Jojo) Nem Singh, a global fellow at the Wilson Center and Assistant Professor in International Development at Erasmus University Rotterdam in The Hague, observed that “there is a growing distrust among major players” in the critical mineral space, including among firms and governments, and between communities and the mining industry.

Nem Singh said the energy transition needs to be a coalition project, and echoed Guy and Naidoo on the importance of local beneficiation. “The legitimacy of mining ultimately depends on the capacity of states and companies to deliver fair benefits to communities,” he noted. “Without strong benefit-sharing arrangements, mining companies will always get more, and communities will always get the shorter end of the stick.”

Raw materials have historically been the source of underdevelopment in many countries, Nem Singh continued, because they have largely been controlled either by powerful multinational companies or resource-seeking states. Now, to prompt investment in downstream sectors and use the transition as a lever for development at home, low- and middle-income producing countries have turned to policies (such as Indonesia’s commodity export bans) that are seen as controversial.

Nem Singh agreed with Naidoo that ultimately, mineral-producing countries are seeking technology transfer and want to move up in the supply chain. “They want more processing,” he explained, “They want more refining facilities within their own borders.”

Safeguarding People and the Planet

At the center of the critical minerals debate is how to minimize the price tag and maximize the benefits—and how to ensure costs and benefits are not disproportionately concentrated. Mining will always have costs. “But we want to avoid creating sacrifice zones just to power our cars,” Nem Singh advised. “We don’t want to build more wind turbines at the expense of [local] communities.”

Zeitler also warned of the necessity of mindfulness in the rush to find and mine essential minerals in order to avoid environmental harms such as deforestation or water scarcity. “As we try to meet our increased need for critical raw materials,” she observed, we [must ensure we] don’t create new environmental security risks.”