Critical Raw Materials Act

The European Parliament has granted approval for the Critical Raw Materials Act, marking a significant step towards ensuring a sustainable supply of critical raw materials within the European Union.

Defining the Critical Raw Materials Act

  • EU Legislation for Sustainability: The Critical Raw Materials Act is a piece of EU legislation designed to address the sustainable supply of critical raw materials within the European Union.

Key Objectives and Highlights

Diversifying Imports and Boosting Domestic Extraction

  • Diversification by 2030: The Act aims to diversify imports of critical raw materials by 2030, ensuring that no single third country supplies more than 65% of any strategic raw material.
  • Boosting Domestic Capacity: Another objective is to enhance the Union’s extraction capacity by 2030, with a goal of domestically extracting at least 10% of strategic raw materials.

Identifying Critical Raw Materials

  • Critical Raw Materials: The Act identifies a list of critical raw materials, which include various metals and minerals such as Aluminum, Cobalt, Lithium, and more.

Increasing Processing and Recycling

  • Increasing Processing: The Act targets increasing the processing capacity to meet 40% of annual consumption, covering all processing steps, with a specific aim of achieving 50% of annual consumption.
  • Strategic Partnerships: To diversify the supply chain, the Act encourages the establishment of strategic partnerships with countries like Australia and Chile. copyright©
  • Recycling Emphasis: Recycling plays a significant role in the Act’s objectives, aiming to increase recycling capacity by more than 10% based on the 2020-2022 baseline. The Act also targets achieving 45% recycling of each strategic raw material from the Union’s waste.

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Addressing EU Dependence on China

  • Main Objective: A primary goal of the Critical Raw Materials Act is to reduce the European Union’s dependence on China for critical raw materials.
  • Rationale: The EU has a high level of dependence on China, particularly concerning rare earth metals, with up to 99% of these materials sourced from China. This reliance raises concerns about supply disruptions, vulnerabilities, and security risks.

Key Proponent

  • Proposed by: The Critical Raw Materials Act was proposed by European Commission President Ursula von der Leyen.

Supporting Facts

  • IEA Critical Minerals Market Review: The International Energy Agency (IEA) Critical Minerals Market Review has highlighted several key findings, including:
    • Growing Demand: There is a substantial demand for minerals driven by clean energy technologies, such as lithium, cobalt, and nickel.
    • Demand Increases: Between 2017 and 2022, significant demand spikes have been observed, with cobalt witnessing a 70% increase, nickel experiencing a 40% increase, and lithium tripling in demand.
    • China’s Dominance: China plays a dominant role in the production of critical minerals. For instance, in 2021, China accounted for 80% of various stages of solar panel production, surpassing its own global photovoltaic demand. copyright©


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