IEA Summit on Critical Minerals and Clean Energy: Key takeaways

The IEA hosted the first ever “Critical Minerals and Clean Energy Summit” on 28 September 2023 at the IEA headquarters in Paris. Almost 50 countries, mostly Ministers, from key producing and consuming nations around the world came together with around 40 business leaders, investors and heads of international organisations and civil society organisations to share their experiences and discuss effective courses of action to ensure rapid and secure energy transitions.

Building on the IEA’s landmark analyses and the Ministerial mandates in 2022, the event sought to build consensus on priority actions to diversify mineral supply chains, enhance market transparency, accelerate technological innovation and recycling and promote sustainable and responsible development practices. This note synthesises the discussion during the Summit and distils key insights on actions that policy makers can take to ensure that critical minerals are an enabler for clean energy transitions.

1. Accelerate progress towards diversified minerals supplies. To support countries’ climate and clean energy ambitions, it will be necessary to significantly increase supplies of many minerals and metals. Despite encouraging signs of growing investment in new supplies, progress on diversifying supply sources has been limited in recent years. The level of concentration has even risen in some cases. The top three producers are responsible for more than 80% of mined lithium and cobalt supplies, and more than 90% of battery-grade graphite and rare earth metals are produced in a single country. The participants highlighted the urgent need to reverse this trend, by bringing new projects online across a diverse range of geographical regions, facilitating cross-investment opportunities between producer and consumer countries, strengthening co-operation through initiatives like the Minerals Security Partnership and introducing financial tools to de-risk investment. The participants emphasised the particular need to support diversity in the midstream processing and refining sectors.
2. Unlock the power of technology and recycling. Participants underscored the need to tap the full potential of technology and recycling to alleviate potential strains on supply and improve competitiveness in markets for refined metals by expanding research, development and deployment. New technology can lead to reduced energy and water requirements for extraction and processing, end-use product designs requiring less critical minerals, robust material tracing and tracking, and new methods to improve circularity, mineral re-use and end-of-life practices. The participants emphasised the latter, through a progressive focus on collection of e-waste, subsequently expanding into end-of life batteries, permanent magnets, solar panels and wind turbines, along with incentives for recycling activities.
3. Promote transparency in the markets. Due in part to higher levels of market concentration, some critical mineral markets have limited price transparency, which introduces volatility and hinders new investments. Consumers are also increasingly demanding more information about risks throughout the supply chain. The participants emphasised the need to develop transparent markets and enabling environments that facilitate new investments, while strengthening due diligence and traceability practices. The participants also called for transparent policies on access to raw materials.
4. Enhance the availability of reliable information. Accurate, accessible and timely data is vital to ensuring a well-functioning market and allowing companies and policy makers to set priorities to address potential chokepoints. However, information on investment levels, trade flows and ESG  performance is limited. The participants called for a strengthened role of the IEA to conduct regular market assessments to deliver the required transparency and support informed decision making. Countries should also consider both international mechanisms for data sharing, while working to enhance the availability of IEA data that will enable stakeholders to gauge risks and identify bottlenecks.
5. Create incentives for sustainable and responsible production. Addressing the ESG impacts of minerals production is necessary to ensure that critical minerals contribute to clean energy transitions in a fair and inclusive manner. Alongside benefits for resource-owning countries and local communities, this can also deliver important security of supply benefits because mitigating these risks can reduce supply disruptions and facilitate new production coming online. All stakeholders should publicly commit to adopting sustainable and responsible practices that mitigate risks in a transparent manner. The participants highlighted the need to encourage mechanisms that reward good ESG performance by embedding ESG considerations into policy and investment decisions and by expediting approvals of new facilities without loosening legal and regulatory protections. They also emphasised the importance of systematic tracking of ESG performance and expressed support to improve public reporting of data on ESG indicators.
6. Foster efforts on international collaboration. The challenges associated with increasing demand for critical minerals cannot be solved by any one country or company. Co-operation among governments, market participants, civil society and international organisations is crucial for meeting these challenges in a way that is inclusive and avoids duplication. The participants called on all stakeholders to explore new opportunities to coordinate efforts, especially on data sharing, security of supply, competitiveness in refining and processing, sustainable and responsible practices, and long-term strategic planning. One specific area is efforts to enhance security of supply by exploring mechanisms that include voluntary stockpiling that do not adversely impact markets alongside other measures to help enhance the resilience of supply chains. The participants also underscored the need to ensure complementarity and interoperability of initiatives, standards and norms.
   

The IEA is working together with countries and industry to identify solutions for secure, sustainable and responsible critical mineral supplies. Based on discussions during the Summit, the IEA plans to make critical minerals one of the major pillars in its work programme, in addition to conventional energy sources, and will continue to drive improvements across the six key action areas.

• Accelerating diversified supplies. Beginning with the landmark 2021 report, the IEA has continuously shone a spotlight on the topic of critical minerals, with a particular focus on the need to expand supply to support net zero goals while ensuring a diversified, secure marketplace at all stages of the supply chain. Future analysis will continue to track progress on accelerating diversified supplies and identify policy measures to de-risk investment in geographically diverse regions, in line with recommendations from the G7 Summit.
• Technology and recycling. In addition to analysis on how recycling could relieve potential pressure on primary supplies, the IEA facilitates international co-operation on technology through its 39 Technology Collaboration Programmes. The IEA will explore ways to expand coverage of the critical minerals topic across the network, including potentially establishing a new dedicated Technology Collaboration Programme. The IEA will also undertake an in-depth study to examine effective policy approaches to tap all potential sources of recycling including e-waste, industry scrap, end-of-life batteries, wind turbines, permanent magnets and more.
• Promoting transparency. The IEA will strengthen its market monitoring capabilities, including supply and demand projections as called for in the G7 Five-Point Plan for Critical Minerals Security. In 2024, the IEA will release a comprehensive market outlook, taking into account various demand-side technologies, and publish the Critical Minerals Market Review on a regular basis, as it does for oil, gas, renewables and other energy sources.
• Reliable information. The IEA has a longstanding role as the premier data-sharing mechanism for information on energy markets. Leveraging its platform, the IEA will launch collaborative efforts with partners towards enabling public data sharing for critical minerals.
• Sustainable and responsible practices. The IEA will continue to regularly update its Critical Minerals Policy Tracker, which monitors policy developments on ESG issues. The IEA will also work with governments and other stakeholders to develop new guidance on policy actions to reduce the negative impacts of minerals production, including refining and processing.
• International collaboration. The IEA will continue to facilitate dialogues between leaders from government, industry and civil society to coordinate approaches towards securing mineral supplies by working closely with partner international organisations and initiatives such as the Organisation for Economic Co-operation and Development, the Extractives Industries Transparency Initiative, the Minerals Security Partnership, and the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development. To implement the 2022 Ministerial mandates, the Agency will announce the next phase of the IEA Voluntary Critical Mineral Security Programme, which will include stockpiling and other measures designed to ensure transparent and resilient supply chains based on shared experience and information on these programmes.
  

The IEA will hold a Ministerial Meeting in February 2024, coinciding with the 50th anniversary of the Agency’s founding. This Ministerial will provide a key opportunity for countries to assess how critical minerals fit into the changing landscape of international co-operation on energy security and climate change, including the role of the IEA in ensuring secure, sustainable and responsible mineral supplies.