Towards a Just Twin Transition? The European Critical Raw Materials Act

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Kiruna, Sweden. Picture courtesy of Nils Soderman, Unsplash

The European Critical Raw Materials Act (CRMA) entered into force on 23 May 2024 with the aim of strengthening EU’s critical raw materials capacities along all stages of the value chain, increasing resilience and promoting supply chain sustainability and circularity.

The CRMA identifies a list of critical raw materials and a list of strategic raw materials crucial for technologies for the green and digital transition, as clean energy technologies (renewable power and EVs) need more materials such as copper, lithium, nickel, cobalt, aluminium and rare earth elements (REEs).

In 2023, the demand for critical minerals saw significant growth, with lithium demand rising by 30%, and demand for nickel, cobalt, graphite, and REEs increasing by 8% to 15%. Clean energy applications have become the primary driver of this demand growth.

The CRMA also sets ambitious 2030 targets for domestic production of critical minerals required for its green transition – 10% of annual needs mined, 25% recycled and 40% processed domestically by the end of the decade. Increasing the recycling target to 25%, along with other circularity measures, may have the potential to contribute to reducing the overall raw materials consumption.

In 2023, 94% of the EU’s REEs imports came from China, Malaysia, and Russia combined. China has become dominant in the rare earth market by producing these minerals at lower prices, helped by government support and often disregarding environmental concerns. Rare earths from around the world are sent to China for processing due to its expertise and facilities.

In May 2024, the European Commission opened the first call for Strategic Projects under the CRMA. These projects, benefiting from expedited permitting processes, will be considered of “overriding public interest” and are likely to receive political and possibly financial support.

Mining and mineral processing projects inherently impact nature, posing risks to the environment, flora, fauna, and local populations. The term “overriding public interest” could potentially allow mining activities in protected areas, where they should not occur. Additionally, overreliance on certification schemes does not guarantee compliance with mandatory human rights and environmental regulations.

The CRMA emphasizes community involvement in its recitals but does not explicitly recognize the Indigenous Peoples’ right to Free, Prior, and Informed Consent (FPIC), as proposed by the European Parliament and demanded by Indigenous Peoples organizations.

54% of the global energy transition mines are located in or near indigenous territory. One example of conflict between the mining industry and indigenous people is that of the Nordic mining industry and the Sami population.

In early 2023, LKAB, a state-owned Swedish mining company, announced the discovery of the largest known deposit of rare earth elements in Europe. EU Commission President Ursula von der Leyen visited Kiruna, Lapland, to celebrate the project, which will require relocating an entire community and displacing Sami reindeer herders.

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Picture courtesy of Jan Hertecant, Pixabay

The Sami are the only indigenous people within the EU’s borders, inhabiting the Sápmi region, which spans parts of Sweden, Norway, Finland, and Russia. These Arctic lands have been crucial for the survival of Sami culture for centuries. The main food source for reindeer, lichens, has become increasingly rare due to human influence, and land fragmentation caused by the exploitation of territories does the rest. The Sami community’s rights have been disregarded since Sweden’s interest in the North began, and with Kiruna becoming a key site for Europe’s green energy transition, the situation is unlikely to improve.

This creates an ethical dilemma for the green transition: critical raw materials offer Europe a chance to reduce dependence on foreign resources, yet this comes at the expense of Sami communities. Unfortunately, the CRMA is yet another failed attempt to address Europe’s unsustainable overproduction and overconsumption and to set the EU on a path towards reducing raw material consumption within planetary boundaries.