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New Year, New Congress, New Impetus for Critical Mineral Policy Reform?

Two weeks into the new year, it appears that 2023 will continue the fast-paced tempo we got used to in 2022 when it comes to developments on the critical minerals front.

With Congressional leadership elections – finally – behind us, policy makers in Washington are gearing up to delve into the issues, and, if the newly announced House Committee assignments are any indication, critical mineral resource and supply chain security will rate high on the priority list.

Looking at the overall trend lines in the critical minerals space, earlier this month we outlined the themes we see emerging for this year, as follows:

  • A focus on the Super Criticals (see our Year in Review post for more info);
  • the growing importance of geopolitics, with China taking center stage and alliances and partnerships continuing to be forged to reduce reliance on Beijing;
  • the acceleration of the green energy transition which will require vast amounts of critical minerals;
  • …as well as industry’s efforts to sustainably green our future by harnessing the materials science revolution.

It appears the urgency to act is not lost on policy makers, and earlier this week, Rep. Peter Stauber (R-Minnesota) the incoming chairman of the House Natural Resources Committee’s Subcommittee on Energy and Mineral Resources, offered an early glimpse into plans to overhaul the permitting process for energy projects with the new House majority.

Rep. Stauber has introduced the Permitting for Mining Needs Act,” a bill that seeks to spur domestic critical mineral production to meet national defense, technology and clean energy needs.

Incoming House Natural Resources Committee Chairman Bruce Westerman (R-Arkansas) has vowed to make permitting reform a priority in the 118th Congress, stressing in an interview earlier this week that “[t]he country’s got to come to grips with where we want to go with this electric economy”  and if we do, being “totally dependent on China and other countries like that to supply the materials we need” is not the answer, but rather striving to “produce these elements and minerals on our own.”  

Prioritizing the decoupling from Beijing is also the emerging theme from a vote to establish a Select U.S. House Committee on China, which will consist of nine Republicans and seven Democrats, and will be headed up by Rep. Mike Gallagher (R-Wisconsin), who has framed U.S.-Chinese competition as a 21st Century Cold War and wrote in an op-ed for Fox News that the “first step is to restore our supply chains and end critical economic dependencies on China,” which he noted produced approximately 90% of the world’s rare earth metals, alloys, and permanent magnets in 2019.

Of course, if recent years on Capitol Hill serve as a guide, we can’t expect a high level of bipartisanship of the 118th Congress overall, but the critical minerals space may continue to be a rare exception.

As a new piece for National Law Review outlines, “there is growing consensus that the U.S. must avoid trading dependencies on foreign sources of fossil fuels, for one, on Chinese critical minerals,” and while reform efforts may face an uphill battle with fundamental disagreements persisting over constraints on environmental reviews and timelines, “[p]ermitting reform will continue to be an issue receiving bipartisan attention,” though “[f]undamental disagreements among Democrats persist on how to put new constraints on environmental reviews and timelines.”

An area “ripe for bipartisanship” according to National Law Review could be “[t]echnologies to trap carbon emissions from power plants and suck carbon directly out of the atmosphere,” with some lawmakers “convinced there will be an appetite to boost carbon removal startups in the next few years.”

Meanwhile, external pressures continue to grow, with geopolitical tensions rising and the green energy transition accelerating.

Here’s hoping Santa put some sneakers under the tree this Christmas, because if this week’s policy announcements in Washington, D.C. are any indication, this first month of 2023, we’ve hit the ground running.