The European Union is struggling with its strategy to reduce its dependence on other countries for the supply of strategic raw materials for the energy transition. Obstacles hinder domestic production, and recycling remains embryonic. However, demand for these materials will only increase sharply over the decade.
Raw materials such as lithium, nickel, cobalt, copper, and rare earth metals, essential for wind turbines, solar panels, electrolysers (for hydrogen), and batteries, are often concentrated in one or a few third countries (especially China), making the EU particularly vulnerable.
To mitigate these risks, the EU adopted the 2024 Critical Raw Materials Act, which outlines a strategy to ensure the security of supply for 26 raw materials crucial to the energy transition. The guideline: no more than 65 percent of the EU’s total consumption of any raw material should come from a single third country.
No tangible results
However, according to the Court of Audit, efforts to distribute suppliers have not yet yielded tangible results. Over the past five years, the EU has concluded 14 partnerships on raw materials, but imports from these countries fell between 2020 and 2024 for about half of the raw materials examined.
Within the EU, too, efforts still need to be made to reduce dependence. The EU aims to stimulate domestic extraction to cover 10% of its consumption. But exploration activities are not very developed. And even when new deposits are discovered, it can take up to 20 years for a European mining project to become operational.
Urgent need for incentives
The regulation sets targets for 2030 for the domestic extraction, processing, and recycling of strategic raw materials. But at the moment, for example, only 7 of the 26 materials have a low recycling rate (between 1 and 5%), far from the European target of 25%, while 10 are not recycled at all.
The report says there are insufficient incentives for European recycling companies, which face high processing costs and technological and regulatory barriers that limit their competitiveness.
Eliminate bottlenecks
The Court of Auditors urges, among other things, that the objectives be better substantiated, that the partnerships actually raise the level of security of supply, and that financial and administrative bottlenecks be eliminated.
In its responses, the European Commission accepts almost all of the Court’s recommendations. Many are already included in its RESourceEU acceleration plan, adopted in December.
To conclude: despite a strengthened legislative framework and the recent launch of the ResourceEU plan, the European Union will have great difficulty in securing, by the end of the decade, the supply of strategic raw materials essential to its energy transition and, more broadly, to its industrial and geopolitical credibility.
