Western governments are now racing to develop strategies to advance the clean energy transition without becoming overly dependent on China for critical minerals. But their plans do not take into account a major potential obstacle: the heavy local policy of opening new mines and industrial installations.

LONDON — The West’s reliance on China for so-called critical minerals once worried only a handful of pundits and policy buffs. Now anxiety has become common, catch the headlines and become the subject of a BBC documentary series. But we have not yet adequately answered the most important question: what should we do about it?

There is no denying the risks that await us. As Europe has learned over the past few months, it is unwise to rely on a hostile state to deliver essential goods. But the solution to the current energy crisis – accelerating the transition to renewable sources – threatens to replicate the current situation in another form, as it increases our dependence on minerals like cobalt, nickel, graphite, lithium and copper.

From electric batteries to wind turbines to extended power grids, these minerals are essential to the transition to clean energy. The World Bank has valued that their production may need to increase by around 500% by 2050 to support global climate goals.

Just as Russia is a major source of fossil fuels, China dominates the processing of many of these critical minerals. It refines around 60-70% of the world’s lithium, nickel and cobalt. And it has made large investments in the world’s richest deposits of these resources, from cobalt in the Democratic Republic of Congo to nickel in Indonesia, which means it controls a growing share of the mines from which they come.

Western governments are now racing to develop strategies to advance the energy transition without becoming overly dependent on China for critical minerals. In the United States, the recently passed law Inflation Reduction Act includes great incentives for EV manufacturers to source critical minerals from trusted partners. The UK unveiled a “critical minerals strategywhich includes efforts to expand national capacity in the sector. The European Union and Australia are moving forward with similar initiatives.

All of these governments see increased metal recycling as part of the answer. But they also recognize that he can only make a certain contribution at the moment. Thus, their strategies all emphasize the rapid development of more mines and critical mineral processing facilities, either domestically or in “friendly” countries.

The energy revolution

The energy revolution

cop27 little sunrise

Join us for our next virtual event, The energy revolutionat COP27 in Sharm el-Sheikh, Egypt, to hear Nicholas SturgeonFirst Minister of Scotland, Laurence TubianaCEO of the European Climate Foundation, Kate Brandtdirector of sustainable development at Google, Jennifer GranholmUS Secretary of Energy, and more.

Register now

But these strategies do not fully take into account a major obstacle: the tense local policy of opening new mines and industrial installations. In wealthy countries, ‘not in my backyard’ activism, opposition from indigenous and environmental groups and complex planning processes mean that even obtaining permission to develop new large-scale mines can take decades, if at all.

In low-income countries, mining development also often faces fierce local opposition, which is compounded by widespread suspicion of large Western mining companies. In rich and poor countries alike, countless projects for new mines of critical minerals – for example, in the WEPeru, Portugal and Serbia – have recently been blocked or delayed due to such resistance.

Admittedly, this activism reflects the dynamism of local democracy in countries aligned with the West. But the risk remains that if the West cannot access the raw materials that the energy transition demands from friendly countries at a reasonable price, it will once again find itself at the mercy of a hostile regime. Concerns that China could “weaponize” its dominance over these minerals, as Russia has done with natural gas, are now widespread in political circles.

Unless the problem is resolved quickly, Western governments may end up having to take emergency measures that ignore local concerns – for example, opening national mines and facilities for national security reasons. They would also likely find themselves trying to heavily weaponize developing countries to increase production, again regardless of local sentiment. This has been the sad pattern of the geopolitics of energy and resources for a century or more.

Avoiding this outcome will require rapid progress towards a new “big deal” between mine operators and local stakeholders. To this end, an ambitious program focused on resetting relations between the two sides must be launched urgently, covering all mineral-rich and Western-aligned countries.

Mining companies, supported by Western governments, must ensure that new operations bring greater local economic benefits and are more responsive to local needs. They must also put in place more credible and visible controls on the environmental and health risks that mines can create. In developing countries, mining companies need to demonstrate that they are performing much better than Chinese companies on these fronts. Western miners are already involved in many good practice environmental and social initiatives, but these need to be strengthened as a strategic priority.

In return for these efforts, local regulators must streamline and speed up permitting processes, and local communities and activists must accept the need to support well-designed projects. Environmental activists will surely recognize the importance of averting a major threat to the energy transition; but old habits die hard and resistance to big business pursuing big projects like mining is, for some, entrenched. Governments can help here, stepping in to mediate disputes between companies and communities.

Some would say it’s a painful remedy for a problem that has yet to appear. But the dangers posed by reliance on China for essential mineral supplies are now all too evident. Unlocking faster mining development closer to home offers the best way forward – and it will require radical new approaches.