EU’s Sefcovic: Real risk that ‘raw materials become the new oil’

Europeans have to be “very vigilant” that today’s dependency on imported oil and gas is not replaced by dependency on lithium, cobalt, copper and other raw materials that industries need for the green transition, Maroš Šefčovič told EURACTIV.

“I really think that, when it comes to the issue of dependency, we could end up in a situation where raw materials become the new oil,” the European Commission vice-president warned in an exclusive interview.

Maroš Šefčovič is vice-president of the European Commission in charge of the energy union. He spoke to EURACTIV’s energy and environment editor, Frédéric Simon, at the end of EU Raw Materials Week 2018.

INTERVIEW HIGHLIGHTS:

  • European Commission is looking at access to raw materials with increased scrutiny
  • Discussions intensify with EU member states on how to develop mining activities inside Europe, re-opening old mines and opening new ones
  • Initiatives on battery manufacturing are in the pipeline for the coming year, including standardisation and regulatory alignment
  • Lithium refining is being promoted as part of a broader strategic push to develop an entire battery value-chain inside Europe
  • New Africa-Europe Alliance to promote sustainable mining, with the aim to leverage up to €44 billion of investments into the region by 2020
  • This means European companies should also be ready to pay taxes, and play a role in the local economy, to the benefit of African countries

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It’s been ten years now since the European Commission adopted its raw materials initiative, in a context of increased competition for natural resources, which saw metal prices triple between 2002 and 2008. Those worries were swept away by the financial crisis but now that the economy is back on track, do you see a risk that raw material prices will start rising again?

It’s already happening. And the strategy that we adopted ten years ago had three priorities which are still relevant today. The first is access to raw materials outside of Europe; the second is mining raw materials inside Europe in a sustainable way; and the third priority which is becoming even more important in the coming years, is how we can improve reuse and recycling.

All the focus now in the European Commission is to reduce dependency on fossil fuels. But we want to avoid trading our dependency on oil and gas with dependency on the precious metals and raw materials that we need for the green transition.

This is why we are looking at access to raw materials with increased scrutiny – because they are often used in the production of high-tech electronic devices. And we continue to update our list of so-called critical raw materials every three years. We had 14 raw materials on the list in 2011, 20 in 2014 and now we have 27 in 2017.

But I was also intrigued to see rubber now on the list because only natural rubber can be used for the manufacturing of tyres. And the problem is not the lack of access to this material but the cartel behaviour of the countries producing natural rubber. So there are different reasons why we put these 27 raw materials on the list.

In parallel, we are also pursuing our priorities on free trade agreements, where we always have a part related to access and free trade of raw materials. As you know, we are more assertive in the WTO, as we have demonstrated with China.

At the same time, we are talking much more intensely with our member states in order to better map out the kinds of raw materials that we have in Europe so we can exploit them in a sustainable way.

This includes permitting procedures, ensuring coherence between different regulations and networking among the member states to ensure resources are shared with other members of the European family. And that was the topic of a meeting we had this week with the members of the high-level raw materials group in Europe.

With growing digitalisation, renewable energies, electric cars, etc, would you say metals and minerals are becoming the new oil of the 21st century?

I really think that, when it comes to the issue of dependency, we could end up in a situation where raw materials become the new oil.

We have to be very vigilant that today’s dependency on fossil fuels like oil and gas is not replaced by dependency on lithium, cobalt, copper and other raw materials that we need for the green transition, where Europe is leading the way.

And we are probably the first to notice that there might be some scarcity of the metals we need. As you know, we are working a lot on batteries and the discussions there focus a lot on cobalt, lithium, nickel and copper. To produce a 3-megawatt wind turbine, which is not the biggest (today there are 8-9 megawatt wind turbines), you need 335 tonnes of steel, 4.7 tonnes of copper,  1,200 tonnes of concrete, 3 tonnes of aluminium, 2 tonnes of rare earth elements as well as zinc. And for me, that is really illustrative of the volume of raw materials you need for the green transition.

Read more oN EURACTIV:
https://www.euractiv.com/section/circular-economy/interview/eus-sefcovic-raw-materials-could-become-the-new-oil/