Deep dive: the importance of critical raw materials for a cleaner future

Critical raw materials have become essential components of modern technology and industry but, at the same time, they face significant supply risks. Find out the actions that Europe has taken to secure its stock and ensure a smooth transition to net-zero.

Tags: cobalt, Critical raw materials, CRMs, Green economy, Lithium, Platinum group metals, Rare earth elements, Scarcity

A few years ago, this blogpost would have been an article in a print magazine. Now, electronics have conquered every sphere of our lives, and you are likely reading this from a laptop, a tablet, or a smartphone. You are holding a device made of very valuable materials, such as platinum, cobalt and lithium. They are more than just valuable; they are critical raw materials (CRMs).

CRMs are minerals, metals, and other raw materials considered key components of our modern technology and industry. They are indispensable for a wide set of strategic sectors including clean energy, digital devices and aerospace. But, at the same time, CRMs face significant supply risks due to geopolitical, economic, scarcity factors, and the fact that they are still irreplaceable. They are therefore doubly critical.

CRMs and the green economy

Critical raw materials form a varied list of elements and minerals with different applications. But they all constitute the starting point of many industrial supply chains, making them indispensable to the global economy. CRMs enable the production of a vast array of goods and technologies that we rely on daily, from smartphones and medical equipment to electric vehicles and renewable energy solutions. In 2023, the European Commission proposed its fifth and most recent list of CRMs, featuring 34 materials – the whole list of CRMs is available on this link. Let’s explore some of the most significant ones:

Rare earth elements: This group of 17 metals includes all of the lanthanides (the elements that sit at the bottom of the periodic table and no one bothers learning in school), plus scandium and yttrium. Despite their name, rare earth elements are not really rare; some rare earths are as common in the Earth’s crust as tin, lead, or zinc. The name originated in the scarce minerals in which these elements were first discovered. In the case of lanthanides, one of the main reasons behind high demand is their amazing magnetic properties, which makes them essential for motors, used in wind turbines and electric engines, and devices such as MRI scanners. Additionally, lanthanides (and scandium, and yttrium) play a crucial role in various high-tech and deep-tech applications, including smartphones, hard disk drives, LED lights, glass and ceramics, catalysts, batteries… More than rare, they should be renamed as ubiquitous!

Cobalt: Cobalt is a vital and costly component in the production of lithium-ion batteries. They are a Nobel Prize-winning discovery, widely used in electric vehicles and portable electronics, like your phone. This metal usually forms part of the cathode, offering high conductivity and structural stability throughout charge cycling, among other properties. So, its role in enhancing battery performance makes it irreplaceable, at least for now. The importance of cobalt extends to materials known as “superalloys”, essential for jet engines and spacecrafts due to their ability to withstand extreme temperatures and stress. Additionally, cobalt is combined with lanthanides to make magnets more stable and stronger, especially at higher temperatures.

Platinum group metals (PGMs): This ‘club’ comprises six elements: platinum, palladium, rhodium, ruthenium, iridium, and osmium. They are regarded as precious metals, like gold and silver. Platinum or palladium jewellery is common… and not at all cheap! These metals are highly resistant to corrosion, chemical attack and high temperatures, and have unique catalytic properties, which makes them ideal for a wide range of applications. PGM catalysts promote chemical reactions and improve process efficiency, and have become essential for applications such as hydrogen fuel cells and electrolysers —although in ANEMEL we explore more sustainable substitutes—, chemical manufacture, and pollution removal. But their applications do not end here. Beyond chemical catalysis, PGMs find uses as key components of electrical and electronic products.

Lithium: This metal is not technically a critical raw material but rather a strategic one. Strategic raw materials are characterised by a potentially significant gap between global supply and projected demand, without the high risk of supply disruption faced by CRMs. Lithium is primarily used in batteries. A lithium battery includes this metal in its anode and cathode. During discharge, the anode releases lithium ions to the cathode, generating a flow of electrons that powers the device. When charging, the process reverses, with lithium ions moving from the cathode to the anode. Beyond batteries, lithium applications extend to glass and ceramics, as well as steel and aluminium metallurgy, making it crucial for various industrial processes.

In summary, CRMs are primarily linked to industry, modern technology, and maybe most importantly clean technologies. In other words, they are crucial for us! But the increasing demand for these materials brings us to the next critical point: supply risks.

CRM supply and geopolitics

In a world where societies are becoming increasingly reliant on technology and where the energy transition to renewables is a must to achieve net zero, CRMs are falling short. For instance, the EU’s need for lithium batteries is set to increase by 12 times by 2030 and 21 times by 2050. Similarly, the EU’s demand for rare earth metals is expected to rise up to 7 times by 2050. This increased demand will threaten the availability of some important materials within the next 100 years.

So, in addition to their economic importance, the “critical” status of CRMs is also linked to potential supply risks. These risks include the concentration of extraction and production in a few countries, which is linked to potential trade restrictions and the political and economic instability of some regions. Moreover, most materials lack efficient and abundant substitutes. Therefore, the search for alternatives is almost as important as other solutions, including a better repurposing and recycling of CRMs.

CRMs are minerals, metals, and other raw materials considered key components of our modern technology and industry, indispensable for a wide set of strategic sectors including clean energy, digital devices and aerospace.

Europe heavily relies on imports, often from quasi-monopolistic suppliers. For example, almost all the EU’s magnesium supply is sourced from China, which also refines 100% of the rare earths used for permanent magnets globally. South Africa provides around 70% of the EU’s platinum group metals, and Turkey supplies almost all the EU’s boron, a mineral primarily used in the manufacture of glass, ceramics, and fertilisers. However, if there is a particular material to mention here, that’s cobalt.

There are two countries that monopolise world’s cobalt supply: the Democratic Republic of Congo (DRC) and China. The first one extracts the mineral, the second refines it. The DRC is the country with the largest known reserves of cobalt in the world but also among the world’s poorest nations, where digging for this metal means getting a little bit of extra income. But the working conditions are often unsafe, with tunnel collapses, exposure to toxic materials (including mildly radioactive products) child labour, and the prostitution of women and young girls. A long history of colonial conflict, political upheaval and instability, and authoritarian rulers in the DRC exacerbate the situation.

The scarcity, monopolies, and even violence surrounding CRMs make them quite expensive, which doesn’t help to mitigate their supply risks. For example, the cobalt in mobile phones is one of the most expensive components of these devices. Similarly, as we’ve already seen, platinum group metals are precious metals. As an example, a ring made of these materials can cost you a fortune—just have a look at the Cartier website.

Possible solutions

There are some possible actions regarding the problems related to CRMs. Not everything is black or white here, though, and no solution is perfect – nor exclusive. In fact, the most successful formula is a combination of initiatives, an alternative is to achieve a holistic approach to the issue.

Recycling, for example, is key when we talk about scarce but necessary goods. It provides an opportunity for increasing supplies of key materials by producing a sustainable secondary stream of these. The new EU Batteries Regulation Act sets that, from 2027, battery-makers will need to recover 90% of nickel and cobalt used, rising to 95% in 2031. They will also need to recover 50% of lithium used in 2027, rising to 80% in 2031.

But recycling batteries is not easy. Batteries vary widely in chemistry and construction, which makes it difficult to create efficient recycling systems. Additionally, the cells are often held together with strong glues that make them difficult to dismantle together with the small proportions of materials of interest, making it hard to locate and recover them. The ideal method is direct recycling, which carefully extracts the components from spent batteries while preserving their original structure. But, so far, it has not been widely implemented.

Recycling is key when we talk about scarce but necessary goods. It provides an opportunity for increasing supplies of key materials by producing a sustainable secondary stream of these.

To ease the process, there are initiatives like the Blade Battery, a lithium ferrophosphate battery released last year by BYD, a Chinese EV maker, which eliminates the module component, making it easier to recycle directly. Another example is the collaboration between the U.S. Department of Energy’s Argonne National Laboratory and Toyota to develop a direct recycling process for cathodes in lithium-ion batteries.

If recycling these materials is complicated, another clever option is not using them. This seems like a logical and simple solution, but it’s not feasible at present, as there are no effective substitutes for CRMs. Addressing this challenge requires more research and development. The European Innovation Council (EIC), established under the EU Horizon Europe programme, targets breakthrough technologies and game changing innovations, like those needed here. ANEMEL, for example, is among the high risk, high gain projects funded by the EIC. What do we do? We are looking into efficient electrolysers that avoid CRMs. Traditionally, water-splitting catalysts require expensive and scarce metals, like platinum and iridium. We want to design an electrolyser that uses alternative, cheaper, and more abundant materials, including metals like iron and nickel.

Electrolysers consist of two separate electrodes, the anode and the cathode, with different chemical requirements. For the anode, our partners study different nickel and iron salts, especially oxides, sulphides, and selenides, because we observed they improve factors such as conductivity and stability of the electrode. Our team also works on nickel catalysts—mainly nickel nitride—as accelerators for the cathode, as well as other compounds such as manganese oxide.

A scheme of an electrolyser that splits water into hydrogen and oxygen
A scheme of an electrolyser that splits water into hydrogen and oxygen

Good intentions and cool initiatives are great, but they need back up to make them sustainable and long-lasting. That is the role of regulations. To this end, the EU launched the Critical Raw Materials Act last year, a comprehensive set of actions to ensure the EU’s access to a secure, diversified, affordable, and sustainable supply of critical raw materials.

The Critical Raw Materials Act aims to strengthen the EU’s capabilities in critical raw materials across all stages of the value chain. By reducing dependencies, increasing preparedness, and promoting supply chain sustainability and circularity, it seeks to boost Europe’s resilience. Key benchmarks for 2030 include: at least 10% of the EU’s annual consumption of CRMs for extraction, 40% for processing, and 15% for recycling, with no more than 65% of any strategic raw material coming from a single third country at any processing stage. Alongside an updated list of critical raw materials, the Act also identifies strategic raw materials crucial for Europe’s green and digital ambitions, as well as defence and space applications, which are at risk of future supply disruptions.

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