After falling behind in the global critical minerals race, the US government is leaving no stone unturned to help ensure its domestic clean energy plans are fulfilled.
Alongside its significant expenditure on exploration and processing opportunities within its own borders, the US is also signing significant partner agreements with several ally nations.
Japan Signs Up as Critical Partner
In late March, the US and Japan signed a critical minerals agreement to establish stronger supply chains.
US trade representative Katherine Tai, and Japan’s ambassador to the US, Tomita Koji, signed a new critical minerals agreement to help strengthen critical minerals supply chains.
The agreement builds on the 2019 US-Japan trade agreement and will strengthen and diversify critical minerals supply chains along with promoting the adoption of electric vehicle (EV) battery technologies.
In particular, the agreement between the US and Japan will look to facilitate trade and promote fair competition and market-oriented conditions for trade in critical minerals. It will also advance robust labour and environmental standards, and cooperate in efforts to ensure secure, transparent, sustainable, and equitable critical minerals supply chains.
“Today’s announcement is proof of President Biden’s commitment to building resilient and secure supply chains,” said Ambassador Katherine Tai.
“Japan is one of our most valued trading partners and this agreement will enable us to deepen our existing bilateral relationship. This is a welcome moment as the US continues to work with our allies and partners to strengthen supply chains for critical minerals, including through the Inflation Reduction Act (IRA).”
The agreement establishes several new commitments and areas for joint cooperation regarding EV battery critical minerals supply chains between the US and Japan.
Australia and the US Sign Critical Minerals Compact
Towards the end of May, Australia and the US committed to enhancing bilateral cooperation under a climate, critical minerals, and clean energy transformation compact.
The framework intends to coordinate policies and investments to support the expansion and diversification of responsible clean energy and critical minerals supply chains, accelerate the development of markets for established and emerging technologies, meet the growing energy and adaptation needs of Indo-Pacific regions, and enhance the region’s role as a driver of resilient and sustainable global prosperity.
Biden said the compact and statement of intent are a testament to his nation’s close bilateral cooperation with Australia.
“We’re going to establish climate and clean energy as the third pillar of the Australia-US alliance,” Biden said.
“This contract can enable the expansion of and diversification of clean energy supply chains, especially as it relates to critical materials.”
The president said the new joint initiative will accelerate a transition to clean energy by building more resilient critical mineral supply chains.
Biden added, “This is a huge step from our perspective, a huge step forward in our fight against the climate crisis. And I want to thank you for your strong leadership and your partnership in this challenge.”
Australian Prime Minister, Anthony Albanese, said critical minerals are a key plank in the global clean energy push.
Albanese commented, “Many of our neighbours understand that climate change is an existential threat. And what we understand is that it’s an important component of our national security. And that’s why it is an important component — an essential part — of our alliance.”
Highlighting the central role of critical minerals to the clean energy transformation, Australia and the US are also establishing a ministerial-level Australia-US taskforce on critical minerals, to be led by principals from the US National Security Council and Australia’s Department of Industry, Science, and Resources, with engagement from key stakeholders across industry and relevant government agencies.
The taskforce is also intended to work with industry leaders to develop and expand reliable, responsible, and secure global access to critical minerals; strengthening global supply through the development of a shared energy industrial base.
Treasury Aiming to Drive Investment in Critical Minerals
In March, the US Department of Treasury and the Internal Revenue Service (IRS) released new guidance to clarify how US manufacturers may satisfy the critical mineral and battery component requirements of the clean vehicle tax credit, introduced by the IRA.
The treasury said the new notice of proposed rulemaking marks a critical step towards building our clean energy future, while honouring the nation’s “Made in America” commitments. The government said it remains focused on investing in the US, revitalizing the nation’s manufacturing, and establishing secure supply chains for critical minerals and battery components at home.
Since the enactment of the IRA, over US$45B in battery investments across at least 75 facilities have been announced across all segments of the domestic battery supply chain, ranging from the extraction of critical minerals to the manufacturing of battery packs.
The treasury’s new guidance ensures that the tax credits introduced by the IRA will continue to drive unprecedented investment in American manufacturing and drive the creation of tens of thousands of high-paying, high-quality jobs.
The government says the new rulings will ensure that the clean vehicle credit provided by the IRA will lower costs for consumers, revitalize the country’s industrial base, and spur domestic manufacturing.
Alaskan Critical Minerals Hunt
Meanwhile, the US’ geological survey will invest more than US$5.8M to map critical mineral resources in Alaska, in partnership with the Alaskan division of geological & geophysical surveys.
This partnership is a key step in securing a reliable and sustainable supply of critical minerals essential to everything from household appliances and electronics, to clean energy technologies like batteries and wind turbines.
“I’m pleased to announce more investments from the bipartisan infrastructure law to improve mapping of Alaska’s geology and critical mineral resources,” said Tanya Trujillo, the Department of the Interior’s Assistant Secretary for Water and Science.
“From the Yukon-Tanana region in the east, to the Kuskokwim river in the west, we are working with the entire state of Alaska to assess domestic resource potential and secure a reliable and sustainable supply of critical minerals. I am especially pleased that these same data will help provide a better understanding of geothermal resources, water resources, and natural hazards
