Sustainable access to raw materials will power a competitive Single Market and a twin transition for Europe
On 5 May 2021, the European Commission presented an update to the European Industrial Strategy to strengthen the resilience of the Single Market. The COVID-19 crisis has uncovered dependency on strategic resources from third countries and signalled the need to secure Europe’s open strategic autonomy, including the adoption of a coherent regulatory framework and multi-country investments, ensuring a level playing field and a competitive Single Market. The new update to the strategy addresses the need for diversification of supply chains, increased use of secondary raw materials, and a circular economy transition. As Europe embarks on a twin transition towards climate neutrality and digital leadership, the Industrial Strategy aims to ensure that European industry can lead the way.
Minerals and metals are the backbone of the EU economy and the key to a more sustainable future. Non-energy raw materials are replacing fossil fuels to power the transition to a climate-neutrality. The Commission recognises the need for sustainable access to resources as fundamental for the industry and the green and digital transformation of the EU economy, delivering on the EU Green Deal goals. As the EU does not produce all the raw materials that are necessary to meet our demand, the EU industry faces global competition in access to critical raw materials for the EU industry.
The Commission has carried out an analysis to provide first insights on strategic dependencies, looking at 5 200 products imported by the EU. The report on strategic dependencies and capacities comprises 137 products, which represent 6% of the EU’s total import value of goods. A subset of 34 products (representing 0.6% of the EU’s total import value of goods) is potentially more vulnerable given their possibly low potential for further diversification and substitution with EU production. About 20 of these products are raw materials and chemicals essential for the energy-intensive industries ecosystem to support the twin transition.
“EIT RawMaterials welcomes the new update to the European Industrial Strategy. Raw materials are the nucleus of Europe’s industrial infrastructure. EIT RawMaterials and the European Raw Materials Alliance (ERMA) envision a green and resilient Europe where raw materials are a major strength of our economy. We will continue our work connecting education, innovation and entrepreneurship and supporting investment cases to lay the foundations for Europe’s future technological leadership and a circular economy.”
European alliance for resilient value chains
EIT RawMaterials coordinates the European Raw Materials Alliance (ERMA) established to secure access to critical and strategic raw materials, advanced materials, and processing know-how for EU industrial ecosystems.
The European Industrial Strategy highlights the need for industrial alliances in strategic areas, such as raw materials, as the best tool to accelerate activities that would not develop otherwise. ERMA unlocks multi-country, public and private investment potentials and supports strategic developments with potential for innovation and high-value job creation in the raw materials sector.
Under two ERMA clusters, the alliance is establishing a project pipeline for rare earths and magnets value chains and energy storage and conversion materials. Moreover, under the value chain-specific consultation process, ERMA task forces have developed the first draft of an Action Plan on Rare Earth Magnets and Motors. The outlined actions address regulatory bottlenecks and are currently in a feedback loop with DG Grow, European Commission.
“If all the projects identified by the ERMA were to be implemented, these could allow as much as 60% of the EU annually installed wind energy capacity to rely on rare earths magnets made in the EU by 2030 and for EU supply to cover 20% of projected nickel demand by 2030. Continued efforts towards sustainable product design, a circular economy and increased collection and recycling of raw materials, as well as a functioning market for secondary raw materials, will be key.”
European Commission will continue to support Member States’ efforts to attract public resources via Important Projects of Common European Interest (IPCEIs) in areas where the market alone cannot deliver breakthrough innovation. EIT RawMaterials and ERMA engage with the Member States to identify investments cases, including IPCEI, to boost the resilience of the European raw materials sector.
