EU critical raw materials act: T&E’s key recommendations for strategic projects

Transport & Environment (T&E), a leading environmental organisation, has analysed Europe’s project pipeline under the CRMA. In its latest briefing, T&E offers insights on the progress of these projects and provides recommendations to ensure the EU meets its 2030 targets.

The EU’s 2030 targets

The CRMA sets clear goals to meet Europe’s raw material needs by 2030. The EU aims to domestically produce at least 10% of the raw materials it requires, process 40% within Europe, and recycle 25% of materials used in batteries. This is crucial as the EU looks to reduce reliance on any one third country for more than 65% of its critical raw material needs.

The success of the CRMA hinges on a carefully selected list of “Strategic Projects,” both within Europe and globally. These projects, whether focused on mining, refining, or recycling, will benefit from streamlined permitting processes and financial support. However, as T&E’s analysis reveals, many projects are still in early development stages, meaning they will require significant political backing and clear industrial strategies to succeed.

The project pipeline: Progress and potential

According to T&E’s findings, the EU’s project pipeline shows real potential, particularly in mining and processing lithium. Currently, 19 mining projects are planned for cobalt, lithium, manganese, and nickel, with 12 of these focused on lithium alone. If all these projects go ahead, Europe could meet up to 60% of its lithium demand for EVs and ESS by 2030. In addition, there are 19 new processing facilities in the works. This could cover 80% of Europe’s lithium processing needs, while nickel and manganese processing capacities are also growing steadily.

Recycling, another crucial aspect of the supply chain, also offers promising prospects. By 2030, up to 40% of Europe’s demand for these critical materials could be met through recycling, provided that all batteries and production scrap are collected. T&E projects this figure could rise to two-thirds by 2040, depending on how quickly recycling technology develops.

However, these promising figures come with caveats. Most of the announced projects are still in their early stages, lacking final investment decisions or necessary permits. This highlights the need for urgent political and financial support to turn these plans into reality.

T&E’s recommendations for selecting strategic projects

To ensure the success of the CRMA, T&E recommends a set of criteria for selecting and prioritising Strategic Projects. These guidelines aim to ensure that projects meet the EU’s sustainability goals while building a resilient raw material supply chain.

1. Focus on CRMA benchmarks: Projects should be selected with the CRMA’s 2030 targets in mind. T&E suggests that at least half of all selected projects should focus on refining or processing, where most value is added. Additionally, at least 25% of selected projects should focus on recycling, which has a shorter timeline to come online compared to mining.
2. Environmental sustainability: It’s crucial that all Strategic Projects adhere to strict sustainability standards. Projects should aim to minimise CO2 emissions and reduce environmental impacts on water, land, and ecosystems. For example, lithium processing should target emission thresholds of 10 kg CO2 per kg of lithium hydroxide. T&E also calls for innovative, low-emission technologies to be prioritised.
3. Engagement with local communities: Mining projects, especially those outside the EU, should respect the Free, Prior, and Informed Consent (FPIC) framework, which ensures that Indigenous communities are consulted and engaged before, during, and after a project’s lifecycle. Additionally, T&E recommends that projects undergo certification through the Initiative for Responsible Mining Assurance (IRMA) to ensure that they meet high environmental and social standards.
4. Add local value: For projects outside Europe, T&E advises that a minimum of 10% of additional value should be added in the local economies of resource-rich countries. This could mean building refining and processing facilities in those countries or supporting local infrastructure. For example, in Chile, companies are required to add $2.000 of value per ton of lithium carbonate to stimulate local investment.
5. Support innovative technologies: As battery and EV technologies evolve, T&E stresses the importance of backing projects that focus on new, more efficient battery chemistries, like lithium-iron-phosphate (LFP) and sodium-ion batteries. These alternatives use fewer critical materials and could help reduce Europe’s reliance on nickel and cobalt in the future.

Challenges and opportunities ahead

While the potential is significant, T&E’s analysis highlights some challenges. Nearly half of the announced projects are still in the early stages of development, with many facing financial, regulatory, or community acceptance hurdles. This makes it crucial for the EU to back these projects with strong industrial policies and financial support.

Moreover, Europe will still need to import up to two-thirds of its critical raw materials from outside the EU. To manage this reliance, the EU has signed strategic partnerships with resource-rich countries. Diversifying supply chains will be key to reducing Europe’s dependence on any single country, especially as demand for green technologies continues to rise.

Conclusion

The EU’s Critical Raw Materials Act is a promising framework that aims to secure Europe’s supply chains for the energy transition. However, its success will depend on how effectively the EU implements the Strategic Projects that support mining, refining, and recycling critical raw materials.

Transport & Environment’s recommendations provide a clear roadmap for selecting these projects, with an emphasis on sustainability, local value, and innovative technologies. If the EU follows these guidelines, it has the potential to build a more resilient, sustainable supply chain and lead the way in the global race for critical raw materials.

Source: Transport & Environment