Critical raw materials: Court of Auditors brings EU back down to Earth: “2030 targets appear out of reach”

Brussels – There is still “a long way to go” before the European Union achieves strategic autonomy in the supply of rare earths, which are necessary for the energy transition. The report published yesterday (2 February) by the European Court of Auditors is a wake-up call: the diversification of suppliers “is not producing tangible results”, “bottlenecks” hinder domestic production, and recycling “is still in its infancy.” At this rate, the 2030 targets established by the EU’s law on critical raw materials will remain a mirage. And with them, the climate and competitiveness targets.

The EU’s transition to renewable energy depends largely on batteries, wind turbines, and solar panels, all of which require essential raw materials such as lithium, nickel, cobalt, copper, and other rare earths. Most of these materials are currently concentrated in one or a few third countries: primarily China, but also Turkey and Chile. Brussels, aware of this dangerous vulnerability, has identified 26 “critical” minerals essential for the twin green and digital transition, whose supply must be secured by 2030.

 “Without critical raw materials, there will be no energy transition, no competitiveness, and no strategic autonomy. Unfortunately, we are now dangerously dependent on a handful of countries outside the EU for the supply of these materials,” said Keit Pentus-Rosimannus, the European Court of Auditors member responsible for the audit. There are essentially three ways to achieve security of supply: diversifying imports, increasing domestic production, and recycling. 

To reduce its dependence on China, which imposed export bans on certain rare earths last year, the EU has signed 14 strategic partnerships on critical raw materials over the past five years. According to the Court of Auditors’ report, these efforts “have yet to produce tangible results.” Between 2020 and 2024, imports from these partner countries – including Canada, Chile, Namibia, Zambia, Ukraine, Argentina, Australia, South Africa, Norway, Kazakhstan, and Uzbekistan – have actually fallen for half of the critical raw materials. 

The EU law also stipulates that by 2030, at least 25 per cent of critical raw materials must be sourced from recycled materials. Here too, “the outlook is not promising.” According to data collected by the Court, as of the end of 2024, seven of the 26 strategic materials identified by the EU have recycling rates of 1-5 per cent, while ten are not recycled at all. Furthermore, the report points out that most recycling targets are general, not specific to individual raw materials, and therefore do not incentivise the recycling of materials that are more difficult to extract and have higher processing costs.

 Finally, the EU aims to increase extraction on European soil to cover 10 per cent of its consumption by the end of the decade. The reality, however, is that “exploration activities are underdeveloped. And even when new deposits are found, it can take up to 20 years for an EU mining project to become operational.”

The Court’s assessment is relentless and the scenario worrying: the EU may find itself “trapped in a vicious circle,” in which supply shortages hinder the development of processing projects, which in turn reduce the momentum to increase supply. All this comes as the European Commission prepares to unveil its Industrial Accelerator Act, a law designed to align competitiveness needs with the green transition — and which, as Executive Vice President Stéphane Séjourné has already indicated, will emphasize promoting “Made in Europe.” Without a change in pace on critical raw materials, the EU will struggle to manufacture the batteries, turbines, and panels essential to the transition on its own.