Autonomy Objective: The EU adopts the Regulation on Critical Raw Materials

  circular economy | March 21, 2024

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economiacircolare

With the adoption by the Council the Critical Raw Materials Regulation becomes reality. EU adopts Critical Raw Materials Regulation. With the aim of autonomy. "The current dependence will become strategic autonomy and an opportunity for our economy" says Flemish minister Jo Brouns. From extraction to recycling and processing, here's what you need to know.

When the regulation on critical raw materials was officially proposed to the public it was February 1, 2023. Now, just over a year later, that regulation officially becomes a community act.

With the European institutions expiring their mandate - let us remember the vote in the 27 EU member states between 6 and 9 June - last 18 March the Council adopted the regulation which establishes, states the note released by the Council, "a framework to ensure a safe and sustainable supply of critical raw materials, better known as the Critical Raw Materials Regulation”. This is the last stage of the decision-making process.

The Critical Raw Materials Regulation, together with the Net Zero Emissions Industry Regulation and the reform of the electricity market structure, is one of the flagship legislative initiatives of the Green Deal business plan. The Council adopted the negotiating mandate on 30 June and the two co-legislators, Council and Parliament, reached a provisional agreement on 13 November 2023.

The times for the act to come into force are known: the regulation will now be published in the next edition of the Official Journal of the European Union and will enter into force on the twentieth day following its publication.

The real focus on critical raw materials

In the statements of Jo Brouns, Flemish Minister of Economy, Innovation, Work, Social Economy and Agriculture, we can read in filigree the true objective that the EU intends to set itself with the adoption of an act of which it has been discussed for some time and on which the 27 member states arrive in no particular order, but all strictly with bated breath.

“With the regulation on critical raw materials, says Brouns, “we want to transform the challenges posed by our dependencies into strategic autonomy and opportunities for our economy”. This piece of legislation will strengthen our mining sector, improve our recycling and processing capabilities, create good quality, local jobs and ensure our industry is ready for the digital and green transitions.”

The European Union is in fact enormously dependent on critical raw materials, i.e. the materials and minerals fundamental for the technologies of the present and future: from wind turbines to car batteries, from chips for artificial intelligence to the production of fertilizers.

Lithium, cobalt, manganese, aluminium, rare earths: these are names with which we have become thoroughly familiar. And which the Member States of the Union acquire both in their natural or primitive form and in the subsequent phases of the supply chain. Remaining heavily dependent on the will of the states from which they import or on geopolitical balances. Which, as the war in Ukraine has taught us, are very fragile.

Precisely from the current situation in Ukraine, the European Union has learned an important lesson. It is possible to reduce your dependence on foreign countries in a short time and to a considerable extent. We have learned this currently with Russian gas, which until February 2022 we imported for 40% of consumption. Just over two years later, gas purchases from Russia have almost disappeared.

Of course, in our case we still remained dependent on foreign countries, in the sense that we preferred a long list of other suppliers of the same good to a single supplier. But the lesson has been learned anyway: in an era in which we are returning to national sovereignism it is better to be prepared. Being more autonomous is the medium-term solution. And the European Union seems to have understood this well.

What does the regulation on Critical Raw Materials provide?

The Critical Raw Materials Regulation introduces clear deadlines for authorization procedures for EU extraction projects, allows the Commission and Member States to recognize a project as strategic, requires supply chain risk assessments, requires Member States to have national exploration plans and ensures EU access to critical and strategic raw materials through ambitious benchmarks on extraction, processing, recycling and diversification of import sources.

The final adopted text identifies two lists of subjects (34 critical and 17 strategic) which are fundamental for the green and digital transitions as well as for the defense and space industries. The Critical Raw Materials Regulation sets three benchmarks for covering the EU's annual consumption of raw materials: 10% from local extraction; 40% to be transformed in the EU and 25% from recycled materials.

To facilitate the development of strategic projects, Member States will establish single points of contact at the appropriate administrative level and at the relevant stage of the value chain of critical raw materials.

Extraction projects will receive authorizations within a maximum period of 27 months, while recycling and processing projects should receive authorizations within 15 months, with limited exceptions aimed at ensuring meaningful dialogue with local communities affected by the projects and adequate environmental impact assessment in complex cases.

Large companies producing strategic technologies (i.e. manufacturers of batteries, hydrogen or renewable energy generators) will carry out a risk assessment of their supply chains to identify vulnerabilities.