Climate breakdown is becoming more apparent with frequent extreme weather events around the world. To reduce greenhouse gas emissions, there’s been a dramatic uptake of renewable energy, primarily solar and wind, with a transition to lithium-ion batteries for electric vehicles and energy storage. The transition relies on increasing the extraction of critical minerals for their production. Frequently described as a race for renewables with calls for ‘smarter’ and ‘more responsible’ mining, the demand for minerals is now also being viewed through a resource nationalism lens that could disrupt renewable energy global value chains that are vulnerable to great-power geoeconomic rivalry.

Global supply of critical minerals and rare-earth elements is currently centered on China, which in 2010 limited Japan’s access to materials due to tensions over the Senkaku Islands. Beijing might well repeat this in the future.  In transitioning to renewables using critical minerals and rare earths, we need to be attendant to energy security, the greening of global mineral value chains, and geopolitical concerns.

Energy security is a fundamental aim of all states. The 1970s oil crises contributed to the creation of the International Energy Agency to help states secure oil supplies reasonably and equitably—although it proved unable to stabilise oil prices. States like Australia have rarely met the IEA’s 90-day minimum stock requirement to ensure supply in times of severe disruptions. Australia’s dependence on imported transport fuel has increased since 2019 when the government released its interim report on liquid fuel security.

Generally, states have remained reluctant to institutionalise international cooperation on energy despite attempts through the United Nations, preferring specific international organisations for oil and gas (the IEA) and nuclear energy (the International Atomic Energy Agency). The International Renewable Energy Agency, established in 2009 with German backing, was only given a mandate to promote renewable energy through policy advice, technical support, technology transfer and stimulating research. As the lead energy agency, the IEA has underpredicted the rapid uptake of renewables. There is no global forum for regulating renewables although energy remains on the G20 agenda. Further consideration of the need for international cooperation for energy security and access to renewable energy is needed.

Of course, states with an abundance of coal and gas like Australia have not been critically dependent on international supplies. However, demand is changing, as we cross planetary boundaries and enter a new era of climatic instability. Australia is increasingly vulnerable to changing policy preferences of export partners in their shift to green their economies and achieve net-zero emissions by 2050 or earlier. The transition to renewable energy requires critical minerals and rare earths that are more site specific than has historically been the case for coal, oil and natural gas. They also require more processing—as in producing wind turbines or lithium-ion batteries—than conventional power systems. However, China dominates processing for copper, lithium, nickel, cobalt and rare earths leading to supply-chain vulnerabilities for renewable energy. China, for example, was found to have engaged in non-competitive behaviour in restricting the export of various forms of rare earths, tungsten and molybdenum in a case settled at the World Trade Organization in 2014. The abundance of critical minerals for export by Australia is therefore welcome, although as many have noted, Australia’s dependence on exporting raw materials for its economic wealth does not take full advantage of the opportunity the sustainable transition offers to ensure its energy security.

A government discussion paper on critical minerals identifies the need to develop downstream processing capability. To date, government investment includes a $200 million commitment to the Critical Minerals Accelerator Initiative, $50 million for a virtual Critical Minerals Research and Development Centre, and a $2 billion Critical Minerals Facility announced in 2021. To coordinate these efforts to develop Australia’s critical minerals sector, the government established the Critical Minerals Facilitation Office in January 2020 to provide strategic and policy advice, develop the national critical minerals development roadmap, and position Australia as a key player in the global supply chain. To this effect, and has been noted elsewhere, Australia needs to not only ramp up investment in research and development (which sits well below the OECD average) but to better manage its long-term contribution to rapidly changing technologies.

This provides a unique opportunity for Australia not only to export its 26 critical minerals with moderate or high geological potential but to also think through the high-value impact we can produce and reproduce, and keep producing. For example, the shift to renewables comes with evaluations of how wind and solar energy is produced and the volume of emissions from the production process. We can and do assess how green energy is. Emissions vary across states and regions, where some high-volume manufacturers depend on fossil fuels to make wind turbines and solar panels. By shifting to processing, Australia could contribute to green energy not just in replacing fossil fuel exports, but in producing renewable energy with the least emissions. More than 40 transnational initiatives for critical minerals extraction promote limiting ecological harm and human rights in the extraction and processing of critical minerals—mostly the ‘3TG’ minerals, tin, tungsten, tantalum and gold. But even attempts by states like the US and Canada to engage in friend-shoring and onshoring are not quieting demands for the regulation of the extraction of critical minerals for global value chains.

But let’s aim higher. Not only is the renewable energy transition underway, there’s also a looming waste crisis. First-generation wind turbines will need to be disposed of, while Australia expects over 100,000 solar panels to be dumped by 2030 as they end their life. Efforts are underway to figure out how to dispose of lithium-ion batteries safely, and if and how to reuse the mineral. By investing in solutions, we can further efforts at integrating minerals into a circular economy, which will help offset vulnerabilities in energy security and global value chains.

Critical minerals present a unique opportunity for Australia in which our economic, environmental and security interests converge. Investment in critical mineral and rare-earth refinement, environmentally regulated mining and mineral recycling could add value to the Australian economy and create more resilient global supply chains for the raw materials that underpin both the renewable energy and defence industries.