Critical raw materials (CRMs)have become a defining political and economic concern at the global level. Asenergy systems continue their shift from fuel-intensive to material-intensivearchitectures, demand for CRMs is rising at an exponential rate. Lithium aloneis projected to see demand grow almost five times by 2040, while rare earthelements used in wind turbine engines and electric vehicles are expected torise three to seven times by 2030. These materials are indispensable inputs forthe manufacturing of batteries, solar panels, and permanent magnets, andtherefore central to green industrial transition.

However, the transition carries afoundational contradiction. The global shift toward environmentally friendlytechnologies depends on mining and mineral processing operations that arethemselves energy-intensive, ecologically damaging, and frequently associatedwith greenhouse gas emissions, biodiversity loss, hazardous waste, and human rightsconcerns, including child labour, in the climate-vulnerable regions where manydeposits are concentrated. Without careful management, the push for climatechange mitigation through CRM extraction risks harming the very communities andecosystems it is meant to protect. In this context, CRM policy has become afoundational pillar of the economic and strategic priorities of majorgeopolitical players, including the European Union, for which secure andsustainable access to CRMs is now viewed as essential to industrialcompetitiveness, the green and digital transitions, and the resilience of itsdefence and aerospace industries.

This policy brief, developedunder SLYCAN Trust's EU Work Programme, examines the critical fault linesrunning through the EU's current CRM policy framework and the extent to whichexisting instruments succeed in reconciling three competing imperatives. Atpresent, the EU's supply security agenda, anchored in its 2030 targets of 10%domestic extraction, 40% processing, and 25% recycling, coexists uneasily withthe geopolitical realities of a fragmented and increasingly weaponised globalsupply landscape, most acutely illustrated by China's tightening exportcontrols on rare earth elements essential to wind turbines and electricvehicles. Governance challenges further complicate the picture: the urgency ofthe climate crisis creates institutional pressure to subordinate environmental,social, and governance (ESG) standards to strategic imperatives, precisely theoutcome that a credible transition framework must avoid. Against this backdrop,the brief assesses how EU frameworks such as the Critical Raw Materials Act andthe RESource EU Action Plan of 2026 seek to establish responsible production asa prerequisite for supply chain resilience, and whether their design is equalto that ambition.