On September 30th, the European Raw Materials Alliance (ERMA) revealed its Action Plan “Rare Earth Magnets and Motors: A European Call for Action”, meant to secure access to rare earth elements for European industry.
In order to achieve climate neutrality by 2050, it is absolutely necessary to secure the supply of raw materials, which are essentials to facilitate the energy transition. However, the EU depends on other countries – mainly China – for the import of permanent magnets and the rare earth elements they are made of. The ERMA’s Action Plan contains 12 actions that are summerised in 4 key recommendations:
- European policymakers will need to create a level playing field, since the cost of EU production is intrinsically higher than the Chinese production cost, which is massively lowered by a set of direct and indirect state subsidies.
- European OEMs (original equipment providers, in this case components making producers) will need to consider potential commitments to buying a significant percentage share of rare earth materials from European producers.
- The EU will need to ensure that end-of-life products and waste materials containing rare earths stay in Europe, facilitating their reprocessing and recycling.
- There is a unique opportunity to trigger large private investments in the emerging European rare earths value chain by match funding. For this reason, the EU and its Member States should pull all financial levers including state aid, such as a dedicated Important Project of Common European Interest (IPCEI).