Examining Ways to Enhance Our Domestic Critical Mineral Supply Chains.
No chapters available yet
Legend
Transcript markers
- text Sentence being played
- text Search result
- text Intervention cited by the link you opened
Click a sentence to play the video from that moment. Select text to quote it with the speaker, timestamp and link.
More options
House Energy and Commerce Subcommittee on Oversight and Investigations U.S. House of Representatives
Follow its sittingsSpeaker 2
This dependence makes us vulnerable and exposes us to risks too big to bear. To remain competitive and secure, we must enhance our own ability to supply critical minerals, starting with enhancing our responsible mining abilities, scaling up refining and processing, and expanding recycling and reuse. Democrats enacted the historic bipartisan Infrastructure Law and the Inflation Reduction Act, two historic pieces of legislation that, among other things, funded domestic mineral processing capacity and supported research and development. The IRA, which was passed without a single Republican vote, invested over 350,000,000,000 in clean energy manufacturing and critical mineral development. It provided tax credits to companies that source materials either domestically or from allies, and created thousands of good-paying union jobs and reduced emissions.
This progress and these gains are under threat from Republicans who are trying to repeal or defund these vital programs. These successful investments are being destroyed by the shortsighted push from Republicans to give giant tax cuts to billionaires and large corporations. Their obsession with rewarding Trump's friends undermines our ability to fund critical programs that support the clean energy transition, infrastructure development, and domestic manufacturing.
Speaker 3
We know overcoming the climate crisis will demand bold solutions to the challenges that lie ahead. As co-chair of the Smart Cities Caucus, I believe technology that often relies on critical minerals can make communities more sustainable, resilient, and livable. We must continue investments that incentivize innovation in clean and critical mineral technologies, particularly those that minimize environmental and community impacts. We must also invest in workforce development and support historically underserved communities. So let me be clear.
Speaker 2
Tax cuts for billionaires do not strengthen our supply chains. They do not help build battery factories, or lithium processing plants, or rare earth recycling facilities. They do not train workers for the green jobs of the future. They do not reduce our dependence on foreign regimes for vital resources. What they do is starve the government of the revenue we need to make smart, strategic investments in America's future.
Instead of supporting clean energy innovation and domestic supply chain resilience, Republicans are fighting to extend and expand tax breaks for their wealthiest Americans at the expense of investments in climate, jobs, and national security. I call on my colleagues across the aisle to abandon this reckless agenda of tax breaks for billionaires, and instead support investments and a strong, secure, and just clean energy future. The American people deserve leadership that puts the long-term strength of our economy and planet above short-term political gains. We must continue to invest in our domestic mineral supply chain, support innovation and equity, and reject the failed tax policies that undermine our progress. Our national security, our climate, and our prosperity depend upon it.
I yield back.
Speaker 1
Thank you. The chair now recognizes the vice chairman of the committee, Mr. Baldesson, for five minutes for an opening statement.
Speaker 4
Thank you, mister chairman, and my opening statement is on behalf of chairman Brett Guthrie. Chairman Palmer, thank you for holding this hearing on critical minerals. This is an important opportunity to discuss a path forward to end our over-reliance on foreign adversaries for critical minerals, including ways we can create comprehensive and resilient domestic supply chains for critical minerals. The US imports at least half of its supply for 41 out of 50 critical minerals on the US Geological Survey's 2022 critical mineral list, and nearly a quarter of those 50 minerals are entirely imported. The US reliance on foreign nations for critical minerals, mainly China, is not a new issue, and the committee held hearings on critical minerals last Congress.
However, given recent events by the Chinese Communist Party, CCP government, this dire situation continues to escalate. Specifically, in August 2023, the People's Republic of China began restricting the export of graphite, gallium, and germanium to the US, and in July 2024 announced a state-run database to ensure that extraction, export, and use of all rare earth resources are strictly controlled by China. Most recently, in December 2024, the PRC banned exports of three rare elements, antimony, gallium, and germanium, to the US. Then as recently as February, the CCP restricted the export of five additional critical minerals, including tuxin, which is used in artillery shells and armor plating, and indium, which is used in phones, televisions, and semiconductors. Just last month, the PRC put seven more rare earth elements that are vital to the American economy and national security on the export control list, including samarium, which plays an essential role in nuclear reactors.
These export controls and bans are significant, especially given that China has a monopoly on critical mineral processing and refining, particularly for rare earth minerals. Specifically, China refines up to 90% of the world's supply of rare earth elements and other critical minerals, including graphite, lithium, cobalt, and copper. Additionally, the heavy rare earth elements on the PRC's export control list are only refined in China. China's monopolization of critical mineral supply chains, combined with the increasing number of restrictions they have placed on critical mineral exports, will have a significant effect on our national economic and energy security. If we want to assure our national security, energy dominance, and the US is a leader in technology innovation such as AI, we must prioritize our critical mineral supply chains.
Because of these developments, it's essential that we decouple from China and create resilient and robust critical mineral supply chains that are separate from foreign adversaries. One pathway towards this is to develop domestic capabilities across all elements of our supply chain. The volatile nature of geopolitics makes our over resilience on other countries, even friendlier ones, an unstable strategy. This is why we need to shift our focus to domestic mining and midstream process. While The U.
Used to have a more robust critical mineral supply chain over time, the American critical minerals industry has become unappealing to many investors due to burdensome regulations as well as financial and political uncertainty. It's time to address these issues and break free from China's stronghold. President Trump has already signed executive orders to boost American critical mineral supply chains, to remove bottlenecks, and relieve unnecessary red tape to operationalize critical mineral companies. Now Congress has turned to step in and help identify remaining challenges and opportunities to strengthen America's critical mineral supply chains. I want to thank the witnesses for being here today, and I look forward to your testimony.
I also want to thank the subcommittee chairman, Mr. Palmer, for his interest and leadership on this important issue. I yield back.
Speaker 1
Thank you. The chair now recognizes the gentle lady from Colorado, Miss DeGuette, for five minutes for an opening statement.
Speaker 3
Thank you so much, Mr. Chairman. I'm here sort of the ute... Democrats utility player this morning filling in for Mister Palon. All of us agree that securing our energy future and reducing reliance on China's critical mineral supply chain is urgent. However, my Republican colleagues' legislative priorities lead me to wonder whether they seriously care about this issue or are just using it as yet another talking point.
Actions speak louder than words. And unlike our Republican counterparts, Democrats have actually passed legislation to make the investments necessary to build a strong supply chain for critical mineral extraction and processing. The Bipartisan Infrastructure Law and Inflation Reduction Act passed in the last Congress invested hundreds of billions of dollars to reshore American manufacturing jobs and build momentum towards durable domestic supply chains. These investments are critical to ensure we are competitive players in booming clean energy industries, so we can once and for all end our reliance on China for critical minerals. These investments also supported downstream manufacturers so that the critical minerals extracted and processed in the United States are used to fuel domestic manufacturing and create jobs for American workers.
These laws provided the Department of Energy with resources for programs that invest along the entire supply chain while expanding existing programs with a proven track record. DOE's Loan Programs Office is a great example of how democratic investments are a win-win for Americans. The loan programs office was set up to invest federal tax dollars in cutting-edge projects that reduce our reliance on imports and create jobs for American workers while generating billions of dollars of net profit for taxpayers. And yet, not one Republican on this committee supported either of.
Speaker 3
Laws, despite the laws making investments predominantly in Republican districts. And with the bill that passed this committee last week, the GOP tax scam, Republicans are giving up on investing in domestic energy supply chains, manufacturing, and clean energy. Also, they could give giant tax breaks to billionaires who don't need them. That bill will kill jobs, hurt domestic businesses and manufacturers, and drive up Americans' energy bills. And now that bill could be on the floor as early as today.
Friends, we were starting to see democratic investments pay off. The bipartisan infrastructure law, the Inflation Reduction Act, and the CHIPS and Science Act were creating hundreds of thousands of jobs across the country in both Democratic and Republican districts. DOE programs created and expanded by these laws were financing first-of-their-kind mineral processing and advanced manufacturing projects across the country. Meanwhile, other programs such as DOE's Office of Manufacturing and Energy Supply Chains were investing in projects to reshore manufacturing jobs and provide skills training so American workers would be ready to take the jobs that the Democratic investments were creating in their communities. But now, all of that's being undone by a reckless and rudderless administration and a compliant Republican Congress.
Clearly, my friends across the aisle are not serious about solving problems with supply chains, and I look forward to talking to the entire panel today about these challenges and issues. With that, Mister Chairman, I yield back the balance of my time.
Speaker 1
Thanks, gentlelady. That concludes members' opening statements. The chair would like to remind members that pursuant to the committee rules, all members' written opening statements will be made part of the record. We want to thank our witnesses for being here today and taking time to testify before the subcommittee. You will have the opportunity to give an opening statement, followed by a round of questions for members.
Our witnesses today are Miss Abigail Hunter, executive director at SAFE Center for Critical Mineral Strategy, Miss Katie Sweeney, executive vice president and chief operating officer at the National Mining Association, Mister Alexander Hergot, president of the Permitting Institute, Mister Casey Hammond, principal at Capitol Pillar LLC, and, finally, Mister David Howell, director of strategy at the Battery Advocacy for Technology Transformation Coalition, otherwise known as the BAT Coalition. We appreciate you being here today, and I look forward to hearing from you. You are aware that the committee is holding an oversight hearing, and when doing so, has the practice of taking testimony under oath. Do any of you have an objection to testifying under oath? Saying no objection, we'll proceed.
The chair advises you that you're entitled to be advised by counsel pursuant to the house rules. Do you desire to be advised by counsel during your testimony today? Saying none, please rise and raise your right hand. Do you promise to tell the truth, the whole truth, and nothing but the truth?
Speaker 1
Seeing the witnesses answered in the affirmative, you are now sworn in and under oath subject to the penalty set forth in title 18 section 1 001 of The United States code. With that, we will now recognize Miss Hunter for five minutes to give an opening statement.
Speaker 6
Thank you. Thank you, chairman Palmer, ranking member Clark, congresswoman DeGatinherstead, and members of the subcommittee. My name is Abigail Hunter, and I serve as executive director for the SAFE Center for Critical Mineral Strategy. Thank you for the opportunity to testify today. SAFE is a nonpartisan nonprofit.
We work with retired military leaders, Fortune 500 executives, and technical experts to offer actionable recommendations on energy security and economic resilience. Let me start with why this matters. What enables an AI data center to compute at massive scale? Gallium-based semiconductors and rare earth magnets. What enables trucks to haul more freight with less fuel, advance aluminum components, and nickel-based superalloys for light weighting?
What keeps a military drone operational in a contested airspace? A lithium-ion battery. Minerals are not just inputs. They are strategic assets, and getting these minerals is just step one. Whether the United States get minerals from our own subsoil, partner countries, the seabed, recycled sources, all of them must be transformed before they can be used in advanced manufacturing.
But China realized this early. Through subsidies, cheap capital, predatory pricing, and overseas investments, it built a dominant position in the midstream. Today, China possesses 65% of global lithium refining, over 70% of battery-grade nickel and cobalt, and more than 90% of graphite and rare earth processing. Their grip extends through global facilities run by state-owned entities and proxies, forcing American firms not to compete with the market but with a foreign government. And Beijing has consistently shown its willingness to use that dominance coercively.
In just the past two years, it's imposed export controls on gallium, germanium, graphite, rare earths, and more, specifically targeting the US defense and technology sectors. This is not market competition. It is strategic leverage. Beijing understands that controlling processing means controlling the pace, price, and availability of next-generation manufacturing. Now, when we talk about processing, it's not just one step.
It's dozens. Different feedstocks must be crushed, milled, separated, refined, and in many cases, chemically converted to achieve the purity specification and form required for manufacturing. That's why policy cannot stop at extraction. It veils the technical aspects of processing, as well as the opportunities that alternatives and recycling present. Second, the economics matter.
Some minerals like zinc and prime are primary products, but others like germanium and antimony are byproducts, only recovered when we refine larger metals. Byproduct economics rarely justify investments alone. So if we don't have midstream capacity for zinc, we lose a source of access to germanium and antimony. Third, market maturity varies. While metals like aluminum trade on open exchanges, emerging and obscure minerals don't.
They often lack transparent price discovery, and are far more susceptible to manipulation. The effectiveness of tariffs, price supports, and stockpiling strategies will vary depending on the market maturity and opacity. One size fits all won't work. While processing varies by mineral, some barriers are shared. First, no processing project survives without buyers.
If there is no US demand, producers are either forced to sell to China or compete with Chinese suppliers abroad, often at a disadvantage. Second, costs are a major barrier. US projects face higher capital costs from equipment and construction and frequent cost overruns, especially for first-of-a-kind projects, as well as regulatory compliance and expensive inputs like energy driving up operating costs. We can't compete with China's subsidized model without derisking the investment. Finally, policy must match market reality.
If restrictions like tariffs or sourcing rules outpace the available supply, we risk undercutting US manufacturing rather than strengthening it. The US cannot secure its mineral supply chains without fixing the processing bottleneck. This is where the strategic risk, economic barriers, and national security converge. But it's also where smart, well-sequenced policy can have the greatest impact. To meet this moment, we must anchor minerals policy in midstream choke-point realities.
Without processing, domestic upstream extraction and downstream manufacturing will still rely on an adversary. Tailor strategic strategies by materials, accounting for key differences in processing technologies, market structures, qualification requirements, as well as opportunities in alternatives and recycling. Align trade, sourcing, and incentive policies with infrastructure and commercial readiness, so as not to outpace market viability. Make US processors and recyclers competitive with financial tools that lower the cost of capital, attract investment, and mitigate regulatory and interest cost disadvantages compared to China, and collaborate with allies to source interim feedstocks, expand non-Chinese capacity, and create resilient rules-based trade networks capable of resisting coercive market manipulation. Say thanks to subcommittee's leadership in highlighting these issues, and stands ready to support in your efforts to strengthen American mineral security.
Thank you.
Speaker 5
Good morning, Chair Palmer, Ranking Member Clark, members of the subcommittee. Thank you for the opportunity to discuss one of the most pressing issues we face as a nation, how we secure our domestic mineral supply chains. The complexity of the issue is extraordinary, but the urgency to act is unprecedented. It is not an overstatement that secure mineral supply chains will help determine the world order in the future. Our economic and national security and the ability to innovate are absolutely reliant on access to minerals, both the ability to get them out of the ground and to process them into final products.
Given the committee's jurisdiction, my testimony primarily focuses on our lack of processing capabilities. And for simplification, I use the word processing as shorthand for any of the steps that come after getting the ore out of the ground, such as smelting and refining. Importantly, extraction and processing must scale together to create a secure mineral supply chain. Simply producing more ore that must be exported to China or other countries for processing, or building more processing capacity without the domestic ore to feed it, solves little. Fortunately, the right policies can address both of these potential points of failure.
The world faces unprecedented mineral demand growth, and China's long-term global mineral strategy includes billions of investment in projects across the globe that have enabled the country to exert its mineral dominance. China controls roughly 85% of the mine-to-metal processing capacity. Over 73% of the world's cobalt, 59% of lithium, 68% of nickel, 85% of rare earths, 90% of graphite, and nearly all of the germanium, gallium, and tungsten are. Copper is following the same trend. In 2024, China processed approximately 44% of the world's total copper compared to the US's 3%.
And China's not the only foreign adversary exerting such control. Russia and allied countries dominate the uranium supply chain. How did we go from one of the world's leading producers in the post-World War Two era to the overreliance on foreign sources? A major reason, complacency. We've woken up periodically and rattled our sabers when China flexed its muscle over rare earths or other minerals, but then accepted short-term solutions or called for further studies.
Now that there is widespread and bipartisan acknowledgment of the undeniable scope of the problem, we can act decisively to institute solutions. We can successfully de-risk and decouple our mineral supply chain from foreign adversaries. We have significant advantages in the United States. A vast mineral endowment, skilled workforce, world-leading safety, labor, and environmental standards, existing energy and transportation infrastructure, and renewed administration and congressional focus. Solutions should include federal investments and incentives to accelerate US efforts to break free of China's hold on the mineral supply chain, such as acceleration of private and public capital investment in domestic mineral production projects, tax credits, additional use of Defense Production Act funds, leveraging of Export-Import Bank programs, preferred loans, incentives for domestic sales, and price support for domestic producers.
Other needed solutions, permitting reform to reduce bureaucratic and judicial delays, research and development investments to improve recovery rates for mining, mineral processing, recycling, and from unconventional sources such as tailings or coal waste. Friendshoring, while the US rebuilds capacity and, when necessary, to supplement US capacity, facilitation of workforce development through educational grant programs to support mining and trade schools and training. Our nation's future as a global leader depends on secure mineral supply chains. The need for these minerals, process materials, and end use products is not going away. It is clearly not a question of if, but where, and the where matters.
Producing minerals here at home as opposed to countries such as China ensures that these activities will be conducted in accordance with world leading environmental, labor, and safety regulations while simultaneously creating vast economic benefits. Through misguided land management, regulatory, and tax policy, we incentivize the offshoring of these critical supply chains. And recognizing the grave vulnerability we created, we have moved with alarming complacency to confront it. We now have a unique and urgent opportunity to turn the tide. The National Mining Association appreciates the committee's prioritization of these issues and is eager to help craft solutions.
Thank you.
Speaker 1
Chair now recognizes Mister Hergot for five minutes for his opening statement.
Speaker 7
Chairman Palmer, ranking member Clerk, thank you for the opportunity to testify. As president of the Permian Institute, it should be no surprise that I'll be talking about permitting today, a nonpartisan pro-development trade association founded in 2021. Our mission is urgent and unapologetically practical. Every month, Permian delay increases. Project costs erode investor confidence and strengthen foreign control over sectors vital to American industrial leadership.
Sectors dependent on secure, integrated mining, processing, and refining supply chains have been failed by Congress for more than 20 years. Even under ambitious World War two style industrial realignment, I need to be clear. We have already lost. Building a domestic supply chain will take at least 20 years. It is not realistic for us to do that.
The uncomfortable truth, our chance to compete with China on critical mineral processing closed in the 1990s. Our viable goal now is simply to remain economically relevant in a race that we are far behind in. TPI was founded not merely to critique broken systems, but to actively collaborate with developers, federal and state agencies, Congress, and communities to deliver real permitting reform. Our members represent billions in investment across energy pipelines, transmission, mining, transportation, and include practitioners who authored the largest, most impactful permitting laws we have in this country, executed them, and navigated them through the White House. After fifteen years in the US Senate, as associate director of White House Council of Environmental Quality and the first executive director of the federal permitting council, which pushed through the largest wind and solar facilities and mining facilities in the country, I founded TPI to prove a core principle.
We can deliver legally sound project approvals or denials within a year without compromising environmental, cultural, or historic protections. The idea that faster means weaker environmental reviews is absolutely false. Our cornerstone environmental laws, on average of the 63 that govern infrastructure, were written 40 years before the creation of the Internet. The Green New Deal, Waxman-Markey, McCain-Lieberman, the Clean Power Plant, even going back to The Inconvenient Truth, all of those climate plans were modeled after Denmark, Norway, and Germany. Those countries simultaneously to changing their clean energy ambitions also have permitting regimes that permit dirty mines, oil and gas facilities, and drilling within 6 months.
In 10,000 pages of the Clean Power Plan, the Green New Deal, IRA, all of those climate bills, not one mention of permitting or critical minerals in any of those bills. It is frustrating to listen to discussions about IRA and 45 z and money and commitment, and the reality is that moving to an entirely different sector without having the industrial supply to allow for that to be built is nonsense. We have put ourselves in an untenable position where we are put ourselves entirely dependent on China. In 2001, China produced less than 30% of the refined rare earth elements. It only took them 10 years to command more than 80% of the rare earth processing, taking over aspects of Indonesia and Africa that we will never get back.
This dominance is deliberate. While we were fighting over coal versus natural gas versus wind, solar, and during the fracking revolution, China made their dominance a deliberate, geopolitical exercise. They made mineral processing a choke point for American economic and semi security ambitions. And for someone that has been to China in a hard rock mine multiple occasions, which many of congress actually haven't, our permitting gridlock is now a national vulnerability that China exploits as they laugh at us while we debate about, a debate about whether or not funding an IRA or whether or not actions in various bills to speed up permitting actually made a difference. The biggest misconception in critical minerals discussions is that mining is the hardest part.
It's not. The choke point is processing and refining. Consider graphite one in Alaska capable of supplying the entire US graphite demand. While China floods global markets with synthetic graphite, we move too slowly, unforced, air of immense proportions. Similarly, South 32, Hermosa could be America's sole significant source of battery grade manganese, vital for technology and defense, yet has been dragged along and could be sped up, and permitted in operation later this year, yet faces unnecessary hurdles with agencies that are not coordinated.
These are things that are easily fixable, but we can't get out of our own way. And then I'd take us to New Range, the nickel copper project in Minnesota representing one of the largest copper nickel deposits in the United States, has faced years of delay after EPA abruptly reversed its progress, allowing China additional time to secure resources in places like Mozambique and South Sulawesi, Indonesia. Each project has much potential, remains hampered by litigation and bureaucratic inefficiency. Symptoms of a permitting system needing modernization, but facing the entrenched political, the political ideologies that somehow opening up bedrock environmental statutes means that we are going to deliberately impact communities, whether it be an environmental justice community or whether it be, my friends in the tribal communities in Arizona and the West. The reality is that we're gonna need to build this stuff.
There is always a balance between human activity and the natural environment. And we either stop using iPhones, we stop using elements that we absolutely need, or we fix the problem. And one last thing is.
Speaker 1
The gentleman's time has expired. We can cover that in the q and a. Chair now recognizes Mr. Hammond for five minutes for his opening statement.
Speaker 8
Mister chairman, members of the committee, thank you for the opportunity to testify. My name is Casey Hammond. I'm a former staffer from the Committee on Natural Resources. And during President Trump's first term, I worked at the Department of the Interior. In that role, I oversaw the Bureau of Land Management, which is responsible for our public lands, including mining and mineral development.
Since leaving the administration, I'm helping others navigate the federal permitting process. When he was my boss, former secretary, former interior secretary Ryan Zinke developed a graphic to demonstrate a few reasons why fixing our mineral dependence must be a priority. The attachment to my testimony demonstrates the different pieces of equipment carried by a navy seal, the different minerals needed for the equipment, and, more importantly, how dependent we are on foreign sources, notably China, for those minerals. The graphic highlights that we are 50% or more dependent on foreign sources for at least 23 minerals carried by a Navy SEAL. Now imagine how this graphic might look for jets, missiles, satellites, and even simple rounds of ammunition.
As a house staffer, I'd hoped that the federal permitting process was administered by impartial civil servants, diligently and fairly applying the rules, immune to the political pressure from Washington. However, I learned that significant decisions rarely occur without the direct involvement of political appointees. I recall being very frustrated early in my time at Interior to find out after the fact that a project had frantic proponents waiting for our review, but those who knew of the project and its urgency withheld such information from those of us who might act. Fortunately, I worked for secretaries who installed strict time limits that they personally tracked, and such hide the ball, game playing was virtually eliminated. Fortunately, unfortunately, this is not always the case.
About a year ago, I became aware of a critical mineral project that had been waiting three years for an environmental assessment to be conducted for exploration. For context, when I was at interior, our internal rule mandated that we must complete an EA in ninety days. Exploration is simply an early investigation with minimal intrusion onto the environment. How do you convince a company to invest hundreds of millions of dollars to develop a mine when it takes three years for permission to drill small holes from the back of a pickup truck? To address our critical mineral supply challenges, we must instill confidence in the mining community.
Project proponents should be assured that if they follow the law, they will be fairly considered and will receive an unbiased and timely decision. The EPA with his expertise in water and air analysis is a cooperating agency when it comes to permitting mines. However, a solitary EPA analyst decides to interject themselves into a project after the NEPA comment period, that can pollute the administrative record and deter project proponents from moving forward. This could apply to the Fish and Wildlife Service, actions taken by historic preservation officers, and others putting projects at risk by unilateral actions of those without accountability. Congress must direct that all requisite agency reviews are done in parallel.
Addressing mineral dependence also involves a judiciary. A new mine can be fully operational, employing hundreds of people, but then a district court judge rules that the decision to approve the mine was arbitrary and capricious. Shutting down the mine for months or years, the appropriate role and scope of the judicial review must be addressed. We must also address domestic minerals processing. Consider copper.
Currently, there are only three primary smelters in the US, but they aren't always operating. That means, incredibly, if you opened a copper mine tomorrow, it is likely that you would plan to send your product to China for processing because they have capacity and it is less expensive than doing it here. In that case, it doesn't matter how quickly you permit a mine. You're still sending the mineral to a potential adversary. I'm encouraged by the swift action taken by the president thus far.
Secretary of the Interior Bergham responded to the president's directives, blazing a new path to decrease review times for environmental assessments from an average of over a year down to just 28 days. I also spoke with career officials within the agency who are now welcoming mining projects in their jurisdictions. They want this work, and that attitude matters. It makes a distinct impression on potential developers. I wanna offer a few suggestions to this congress.
First, narrow the scope of NEPA reviews, lay out clear certain requirements for project applicants, encourage investment through a motivated, responsive, and efficient loan program office at DOE, create a mobile and responsive agency workforce, and create an environment of accountability. We have an opportunity to fundamentally change the way we engage with the mining industry and generate domestic prosperity. Thank you, Mr. Chairman. I'm happy to take any questions the committee may have.
Speaker 1
Thank you. The chair recognized Mr. Howell for five minutes for his opening statement.
Speaker 9
Chairman Palmer, ranking member Clark, and distinguished members of the subcommittee, thank you for this opportunity to provide an update on the BAC coalition's efforts to establish and secure the domestic upstream manufacturing supply chain for lithium-based battery materials. I'm Dave Howell. I'm the strategy director.
Speaker 9
I'm Dave Howell. I'm the strategy director for the BAT coalition. Our 15 members provide a collective voice of the battery upstream supply chain and extraction, synthesis, and processing to produce battery-grade and critical materials. The Bat Coalition supports implementation of a comprehensive legislative and federal agency policy strategy that will maximize the market incentives and trade protections necessary to grow this critical industry in the US and promote long-term resiliency. The domestic high-capacity battery supply chain is at a tipping point.
Battery demand in the US is expected to grow in the coming years. High capacity batteries, like lithium-based batteries, are critical for defense systems like drones, portable power, personal wearable batteries, and almost every major weapon system. And commercial applications like electric vehicles, grid storage, and consumer electronics. These markets all utilize many of the same material supply chains and typically only differ in cell design and format, which is why these markets are inherently interconnected. This is a critical area for US energy dominance and innovation, as well as presents an urgent national security imperative to establish a strong supply chain free of Chinese influence.
The main supply chain concerns exist in the upstream materials market, where China maintains over 70% global market share of almost all battery materials from refined precursors to finished products. And in certain cases, China controls well above 90% of the global market for some critical lithium battery materials. Chinese state-backed firms continue to build infrastructure for current and future battery materials demand. It is important to point out that battery materials and processing can represent over 70% of the value of lithium battery manufacturing, making the upstream portion of the supply chain critical to our domestic economy and supporting manufacturing jobs. Policy actions are vital to building and protecting the domestic upstream battery material supply chain.
BAT members encourage Congress to pursue policy remedies such as the recently introduced bipartisan Critical Minerals and Manufacturing Security Act, CMMSA, by Doctor Raul Ruiz from California and Congressman Gabe Evans from Colorado. It represents an important first step in establishing favorable tax policies for this critical domestic industry. Specifically, CMMSA increases IRA 45x advanced manufacturing protects production tax credit for battery electrode materials production to 25% of the production cost, and it also includes the cost of the raw materials. It includes foreign entity of concern restrictions to prohibit FEOCs from accessing US government tax credits. It adds North American Free Trade Agreement material sourcing requirements to the eligibility rules and expands electrode active material definition to include precursor materials, binders, and solid state electrolytes.
That also strongly encourages action in additional measures. The congress continues to support full funding and timely execution of the Department of Energy's battery materials and processing manufacturing program funded through section 40207 of the Infrastructure Investment and Jobs Act to support competitive cost shared grants to establish domestic manufacturing of batteries and the refining and processing of battery materials, that congress continues to support funding and timely execution of the Department of Energy's loan program, and that the DOE loan program prioritize applications that support critical materials production, and that congress supports federal agency funding to advance innovative solutions to support the upstream material supply chain. In closing, we appreciate your leadership and consideration of these vital federal initiatives. The coalition stands to be a resource on these critical material matters. On behalf of the BAC coalition, I appreciate the opportunity to provide testimony before you today.
Thank you, and I look forward to your questions.
Speaker 1
I thank all the witnesses for their testimony. We will now move to the questioning. The chair recognizes the gentleman from Ohio, Mister Balderson, the vice chairman of the subcommittee, for five minutes.
Speaker 4
Thank you, Mr. Chairman. Thank you all again for being here. My first two questions are my first question is directed for mister Hergot and miss Sweeney. The US has the second longest timeline for mine to be approved, and we've heard anecdotes of projects waiting decades for approval to break ground or to begin operations. Why is it that approvals of projects in the US, whether it be a mine, way processing, refining, or recycling facility for critical minerals, take so long in the US?
Mister Herrod, I'll let Miss Sweeney go first, please. Ladies first.
Speaker 5
Thank you so much. One of the main reasons is lack of coordination among the various agencies that are involved in the permitting process. Most mining projects will require a variety of permits. We've had member companies that have mines that require over 90 permits. So there's a lot of coordination.
I think another problem is, we have the statute of limitations for NEPA is 6 years. It's way too long. The litigation component adds decades or cannot decades to the permitting process.
Speaker 7
Too many decision makers spread across too many parts of the country, that are not equipped to deal with the modern technological advances and projects that we're dealing with today. The bottom line is that projects must, many of the laws that govern these projects are, create obstacles, that then create litigation footholds for anyone that opposes the project to use rhetorical legal process to dispute the inherency of whether they like the project or not. You should not be able to use the law to stop a project that you otherwise disagree with on the merits. On balance, 80% of the projects that are sued in this country end up winning in court, they're abandoned because they're insufficiently capitalized. Anyone that's throwing capital into build a pipeline, a mine, or any type of energy generation has got to be crazy at this point in the country.
We do not reward that. Meanwhile, the rest of the world is building things 10 times faster than us while we allow for projects to languish in a debate. The other reality is if when I walked into the Department of Interior under the last administration and talked to my good friend Tracy Stone Manning and Secretary Halen, and then I asked, how many environmental impact statements do you have moving through the Department of Interior, whether it be at BLM or BOEM? It took 4 weeks for them to come back with an answer, and even that was inaccurate. Inaccurate.
We have no transparency in this black box of a system. We're using legacy paper-based system to deal with some of the most complicated projects the world has ever seen. If Keystone pipeline was 2,700,000,000, the average project size now is about $67,000,000, and we're still using a calculator to deal with things that we should be using AI and technology for. I could go on and on, but I don't wanna waste any more of.
Speaker 4
Your time. Well, and thank you. You answered part of my follow-up question. And, Miss Sween, I'll let you also answer my follow-up. Excuse me.
How does this compare to other developed nations with similar labor and environmental standards?
Speaker 5
It is not a good look for The United States when it comes to comparing to other major mining countries with similar standards. Australia and Canada, for example, do the permitting in at least half the time that the US does.
Speaker 4
Okay. Thank you. Mister Hergot, does the current complicated and burdensome permitting process and wide scope of judicial review for critical minerals production, processing, or refining make it difficult for smaller companies to also thrive in the US?
Speaker 7
Absolutely. Absolutely. In fact, the abandonment rate for a small mid cap company to invest and explore on a mining facility, you've already spent close to $200,000,000 before you even submit an application to the federal government just on technological feasibility. The only people that are gonna be able to fund that are sovereign wealth funds, are people that like to lose money. I mean, at this point, there has been so much cast aside on the regulatory uncertainty on building anything in this country, let alone the fact that most of what we fight about is how we move and generate electrons when it comes to critical minerals.
When I talk about how we've lost the war with China, it is because we have failed to realize and connect the dots that 90% of the materials in this room are from China. We have not, and I had this debate with mister Grahalva, the late mister Grahalva, the fact that he would malign and demagogue the mines that were being built in The United States, but at the same time fail to appreciate that if China yanked the cord, congress would cease to operate.
Speaker 1
And your mentioning of the late Mister Rehava, I should have done this since the very beginning. Just learned this morning that my friend Jerry Connolly passed last night, and I want to extend condolences to Mister Connolly's family and to my Democratic colleagues and to many of my Republic colleagues. Jerry was a genuinely a friend. He was one of my favorite people to work with. We rarely agreed on anything, and he would absolutely destroy your arguments, but he didn't destroy people.
And, we're gonna miss him. Chair now recognizes the ranking member of the subcommittee, the general lady from New York, Miss Clark, for five minutes for her questions.
Speaker 2
Thank you, Mr. Chairman. And, likewise, Jerry indeed was a very special colleague with an ability to debate, and to get his points across without being mean spirited. So we will dearly miss him. We hold his family in our prayers. Critical minerals are essential, sorry.
Speaker 1
Would you start the clock back at five minutes? I don't wanna count her comments on Mr. Connolly as part of her. Gentle ladies recognized.
Speaker 2
Thank you, Mr. Chairman. Critical minerals are essential to everything from cell phones and solar panels to the weapons and kit our military uses to protect our national security. That is why our reliance on imported critical minerals is so concerning. China dominates the global supply chain for critical minerals, critical mineral processing. Relying on China for critical minerals undermines our national security and puts us at a competitive disadvantage.
This is one reason why Democrats made comprehensive investments to bolster the domestic supply chain for critical minerals through the bipartisan infrastructure law and, excuse me, inflation reduction act. Mister Howell, in your testimony, you say that there cannot be an industrial base for defense-critical systems without a robust industrial base for commercial battery materials. How are the defense and commercial supply chains for critical minerals interconnected, as you've stated?
Speaker 9
Thank you, congresswoman. Yes. The department of defense and DOE commercial batteries are essentially the same, particularly for critical materials and components of those batteries and lithium-based batteries particularly. So the cathode is typically the same. It's either a combination of a nickel, cobalt, aluminum type cathode or manganese.
Or on the anode side, it's graphite. So both the commercial applications, EVs, stationary storage, consumer electronics, and defense application need these high capacity batteries. So they're definitely interconnected.
Speaker 2
Very well. Thank you. And it is clear that these challenges aren't going to solve themselves. When Democrats held the majority, we acted to reshore manufacturing and invest in domestic supply chains for critical minerals. Now that Republicans are in charge, it seems like they are more interested in canceling critical mineral investments to pay for billionaire tax cuts than building on the investments in America that Democrats made over the last four years.
Miss Sweeney, our federal investments in critical mineral processors and other manufacturing that is downstream from critical mineral mining projects are a necessary part of building a robust and sustainable critical mineral supply chain.
Speaker 5
I one of the recommendations that we have is to look at a variety of federal investments to help support our getting away from China as our main source of critical minerals.
Speaker 2
Very well. We can serve as a catalyst, for sure. Miss Hunter, what would happen to critical mineral projects that are just getting started if the federal government abruptly pulled back from BIL and IRA investments in domestic critical mineral extraction and processing?
Speaker 6
Thank you for the question. In my written testimony, I talk about the importance of leveraging demand drivers so that we can source alternative sources of supply, encourage alternative sources of supply to come online. Unfortunately, today, the market in most cases is at equilibrium for many of these minerals. But in some cases, it's actually overcapacity. So we do have to center ourselves around new demand from robotics, AI, from clean energy technologies, to encourage manufacturers to reorient these supply chains.
I'm hopeful with the executive branch, with President Trump's leadership on these issues, the prioritization that we'll see this come together. Critical minerals policy demands certainty. And given it's a bipartisan issue, I'm optimistic that we'll get there.
Speaker 2
Absolutely. Hope springs eternal. We cannot address our dependence on China for critical minerals in the national security area without building a robust supply chain supporting our commercial needs. That means maintaining critical investment in clean energy, vehicles, chips, and then many other products made with critical minerals that Americans use every day. Republicans say that they want to end our reliance on China for critical minerals and support American workers, but they have rejected and attacked every single policy aimed at accomplishing that goal.
Democrats fought to end independence on China for critical minerals and support American workers when we control Congress. We will keep fighting to protect investments in American workers, domestic manufacturing, and clean energy. With that, Mr. Chairman, I yield back.
Speaker 1
Chairman, I recognize this gentleman from Florida, mister doctor Dunn, for his questions for five minutes.
Speaker 11
Thank you very much, Mr. Chairman. You know, to ensure the US has a robust supply of critical minerals, private entities and the government have to navigate many market complexities. And that includes, you know, the upstream extraction, midstream processing, downstream manufacturing. If we can't compete with China on this, and they're doing all these price setting, export controls, whatnot, the US is simply not going to have the industry or the economy needed to produce these critical minerals. So we have to create an immediate need for every level of the supply chain.
For example, in order to have reliable minerals, we need.
Speaker 11
have qualifications and purity standards, which we don't seem to have set up right now. Florida State University is in my district. It's home to the National Magnetic Field Laboratory, the largest, most powerful magnet lab in the world. I'm proud of that. The lab creates about $700,000,000 a year in US economic output.
And, these high magnetic fields are leading to discoveries in complex materials. Researchers are working to develop US-based rare earth supplies in Florida. FSU and industry partners are currently working on new ways to remove, we think, over $30,000,000,000 worth of rare earths and minerals that are in Florida's phosphogypsum stacks, what they call it, gypstacks. These are the old phosphate mines. This would create a US supply of critical minerals needed to unleash American technology, energy needs, and reduce our dependence on China.
What we discovered in Florida is that these chip stacks have enormous reserves of rare earths in them. And if we could separate them, we think we have decades and decades of supply. It's alarming that The United States must rely on China to acquire the 50 most important minerals, rare earth minerals that we work with. Something that hasn't yet been mentioned is that 27 of those 50 critical minerals can be found in the state of Florida. And the only two that are currently being mined are zirconium and titanium.
Mister Chair, I would like to submit for the record a report from the FSG National Mag Lab. It's entitled Florida's Potential as a Production Center for Rare Earths, Critical Minerals, and Industrial Byproducts.
Speaker 11
Thank you so much. Miss Hunter, you very clearly laid out America's market risks and the need for secure, qualified end products. Noted that to justify execution, high risk firms typically will require market pricing, strong demand signals over time. Given these factors, how would you suggest the US government expand its commercial base for these critical materials and execute a deterrence strategy against China?
Speaker 6
First, I wanna recognize that different types of American ingenuity coming out of the national labs, universities to find alternative pathways, substitutes, different processes even from biology is very critical for us to explore as we decrease dependence on adversaries for these sources. In terms of how The US can help both, creating more alternative sources of supply at home, but then contending with these market manipulations that you laid out, doctor Dunn, congressman. I think we have to take kind of a two-pronged approach. First, dealing with the competitive disadvantages US processors face, the many different costs, in CapEx and OpEx that are higher in the United States compared to different parts of the world that I outlined in my written testimony. Additionally, looking at partnership with allies so that we can make sure there's no circumvention of US unilateral policies like tariff sourcing provisions through third-party markets so that our producers can compete on a level playing field.
These will be critical to ensuring American competitiveness.
Speaker 11
Thank you for that. Miss Hammond, China uses predatory tactics to block the US ability to develop a commercial and globally competitive domestic mining and production. We're suffering the consequences of decades of that and underinvestment, frankly, on our part. Does China's mineral dumping intentionally harm the development of US industries? And if so, what actions should we be taking?
Is this a straightforward countervailing duties and anti-dumping case? Mr Hammond? I'm sorry, Mr. Hammond.
Speaker 8
Thank you. Yep. Well, that's one of the many challenges we face. Right? How are we gonna compete with China?
And my view, the strongest case we have is making it more attractive to develop here. We have to create an environment where mining companies feel that this is the best place for the investment. Alex said earlier, he used the word crazy. You'd have to be crazy to develop here. And I've actually had a mine owner telling me that exactly.
When I asked him, I was like, you gotta be crazy to be doing this here. And he said, well, in some other places, that's worse. And the minerals here, so we're gonna try here. This is after he'd been locked up in a court for a while. But in my view, yeah, that's our number one, has to be our number one priority, is making this an attractive place to invest.
Speaker 1
Thanks, gentlemen. The chair now recognizes the general lady of Colorado, Miss DeGuette, for five minutes for her thank.
Speaker 3
Thank you so much, mister chairman. Recently, we had a hearing in the energy subcommittee on the grid, and all of the witnesses at that hearing agreed that the energy sector is increasingly moving towards renewable energy. And so I'd like to ask all of you, as we move towards renewable technologies like wind, solar, and battery storage, that is going to require materials like cobalt, copper, graphite, and other rare earth minerals. Correct? Miss Hunter?
Speaker 6
Yes. Renewable energy sources typically depend on a multitude and variety of critical mineral resources. And so,
Speaker 3
Your Miss Hunter, in your testimony, you noted that the advanced manufacturing production credit made possible by the IRA would help to offset domestic critical mineral mining costs. Is that right?
Speaker 6
Within the 45x production tax credit, there is a 10% for critical minerals production, including critical mineral inputs, and indirect inputs. That can help with the distorted playing field that American processors currently compete on, insulating them also from the price manipulations that we've seen, that have been used nefariously with certain minerals by the PRC.
Speaker 3
Thank you. I'm sorry to say that my Republican colleagues are trying to cut that funding along with $500,000,000,000 in clean energy incentives that would support American businesses. So, mister Hall, I wanna ask you, in your testimony, you pointed that IIJA's $6,000,000,000 investment in battery manufacturing is necessary to compete with global competitors like China. Is that correct?
Speaker 3
And, so the president previously froze this IIJA funding stream and proposes to cut $15,000,000,000 in IIJA funds. So that's not gonna help to help us become independent with these productions, is it?
Speaker 9
It will not. And do recognize that many of those programs are actually first of a kind production facilities in The United States. So the federal government helping to buy down that risk is very important for private-sector investment.
Speaker 3
And building out a successful critical mineral supply chain domestically is also gonna require upholding the highest mine safety standards. Is that right?
Speaker 3
Why would you if you're gonna build out the network, some of your fellow witnesses here have suggested that we just and none of us think we should have unreasonable delays in permitting or anything like that. But at the same time, as you're gonna develop more domestic production, you still have to keep high standards. Is that right?
Speaker 9
That is correct. And we have examples around the world. Australia is a great example of having very high environmental standards for mining and accelerated permitting.
Speaker 3
Okay. Now, unfortunately, president Trump and Elon Musk's doge proposed eliminating more than 30 Mine Safety and Health Administration offices where mine safety experts inspected over 17,000 sites last year. I'm wondering if, mister Hall, if you could tell me whether closing mine safety offices would mean there would be less oversight over mine safety practices.
Speaker 9
I think that there could be less oversight. I do think there's lots of room for improvement in mine safety inspection. AI was mentioned before, but bringing together federal agencies like the Department of Interior, Department of Defense, Department of Energy, and using the expertise that we have that's already located in those agencies, could accelerate mine permitting and increase safety.
Speaker 3
I think that would be a splendid suggestion. And if you have any further thoughts on that, if you could supplement your testimony, that'd be really helpful to this committee as we try to develop bipartisan legislation. I yield back.
Speaker 1
General lady yields. The chair now recognizes the chairman of the full committee, Mr. Guthrie, for five minutes for his question.
Speaker 12
Thank you, Mr. Chair. Thank you for having this. Sorry. I've been in the rules committee over at the Capitol Building most of the night. So, I missed your testimony, so I apologize.
And first, I wanna just bring up, I know I think everybody probably heard that our dear colleague, Jerry Connolly, passed away. And I mentioned him in our full committee. He was one of my dear friends here. He and his wife, Smitty. And they always told a story about where he brought her the wrong Valentine gift last time.
This one, he was studying to be a priest. He was in the seminary. It was right before vows, and she had been a nun, his wife. And they met at a nonprofit thing later. They both left anyway, I was telling a we were on a NATO committee.
I'm telling a friend of ours in Europe. I said, well, Jerry was about to be a priest, and he married a nun. And he came to me and he goes, you make it sound like I was trolling the convent. You better tell it, you better tell that like it really is. I didn't think about the story of it.
But, anyway, so, gosh, what a man. What a wonderful person. So, I'm sorry. We're gonna all lose, we've lost him. Getting back to you then.
Thank you, mister chairman, for doing this. Critical minerals, as we know, we saw during the tariff issues when China was gonna start restricting that, and the leverage they had. And so, miss Hunter, how critical are critical minerals, and particularly rare earth elements, for the reliability for energy and also to being competitive with China for AI, which is part energy as well. You wanna talk about that?
Speaker 6
Thank you for the question, chairman. Rares are a really good example here of the importance of energy infrastructure, ensuring American energy dominance, and then also supporting new growing technologies like the AI revolution. They get a lot of attention, rare earth elements, for their application in permanent magnets, specifically used to propel wind turbines, also to use in electric motors for EVs. But their utilization across society is really outsized. When we're putting in place these new AI data centers, they have to remain cool.
It is the rare-earth magnets that actually keep the fans going in these data centers. So, critically important there as well. Another good example besides where earth's copper and aluminum for their conductivity, they're used not only in transmission infrastructure, but also in these data centers to make sure they can have that high level of computation.
Speaker 12
Okay. Thanks. And so miss Sweeney and or miss Hunter and also miss Sweeney, the issue right now is China. Well, we need them anyway, but the issue right now is China. And so could you talk about, I'm sorry, Miss Winnie.
Miss Hunter could talk about it, too. I think my question for you, what are the economic implications of not having our own supply, Miss Hunter? And then, Sweeny, if you'll talk first, is, and talk both of it is my understanding is that China has tried to kinda drum up opposition in The United States. For us to develop our own critical minerals and rare earth elements, process not only mining, but processing as well. I mean, how does China try to use market manipulation, any type of thing to prevent us or discourage us from developing this industry, which makes us more dependent on them?
Can you give us some examples of that?
Speaker 5
Yes. A great example, I think, is the Jervois Cobalt mine in Idaho. They were just about to open. They were fully permitted, and China dropped the price of cobalt, manipulated the market, dumped excess cobalt onto the market, and Sherrois had to choose between operating at a loss or closing, and they closed that facility.
Speaker 12
But that's a prime target for trade action, is it? Should be. So, Miss Hunter, if what is the, what are the national security implications if China keeps doing this and we don't have our own supply?
Speaker 6
There are very clear national and economic security implications if we don't find alternative supplies from China. Again, rare earths is a great example. With the most recent export controls that we've seen, that have been somewhat de-escalated. We heard, you know, it's covered all over the news about how manufacturers who keep, you know, around 45 to 60 days of inventories are lacking alternative sources of supply, particularly for heavy rare earths that we have to get processing online for. Last year, USGS documented a launch.
Speaker 12
I'm just about out of time. We have the biggest proponent of our earth minerals chair in this committee right now in critical minerals, Mister Palmer, and we're gonna all turn him loose and ourselves loose. What? Turning ourselves loose and having a game plan, two different things. I know he has a game plan.
I'm trying to learn from him. So what do you anybody, I'll just start with you guys, suggest what does Congress need to be doing? What's the biggest impediment that Congress can help you solve to get rare earth and critical mineral processing in our nation? Stateside, start with Miss Hunter. Yeah.
And go down.
Speaker 6
Permitting reform and helping with the cost of disadvantages for US processors.
Speaker 7
Capital being put at risk. There's a 30% premium in the United States, spent on unnecessary permitting costs. The IRA, all it did was offset half of that. So, if we sped up mining projects, we would see close to a trillion dollars of foreign direct investment pour into the United States, and you wouldn't need Keynesian style federal money. Now I'm not gonna tell my members, they're gonna slap me if they don't like the free money.
But at the end of the day, we need to change the way we think about it.
Speaker 12
That's what Mr. Palmer says. A mid trillion dollars, all that. So you're saying he's right?
Speaker 7
We have a narrow window where China is at the end of its useful life on what it built twenty years ago. It can no longer meet the purity standards that are required for AI, semiconductors, cathodes, and the rest. So we have about a two, three-year window where we need to get out of our own way, we might be able to catch up a little bit to change.
Speaker 12
I'm not gonna get to the other two of you, but I will say that the time to act is now, and so it's time for us to we're gonna put some action into this. Thank you very much. Appreciate it.
Speaker 1
Thanks, gentlemen. The chair now recognizes the gentleman from New York, mister Tonko, for five minutes for his questions.
Speaker 13
Thank you, Mister Chair and Ranking Member. Today's hearing feels profoundly out of touch, given the ongoing effort by my Republican colleagues to defend programs that invest in our ability to catch up and develop much-needed domestic critical mineral supply chains. Critical minerals are key to US national security and economic prosperity, are required for technologies like cell phones and optics, aircraft, and EV batteries, and their use is only growing. The market for critical minerals was some $320,000,000,000 in 2022, which is double the size it was only 5 years earlier. While we cannot lose sight of the challenges in developing critical mineral supply chains, it is just as essential that the minerals we rely upon are sourced in a transparent and ethical manner.
Last year, I sponsored the Critical Material Trace Act, which would bring much-needed transparency and accountability to critical mineral supply chains. This bill would establish a DOE program that supports the development and adoption of digital identification systems for imported technologies, including EV batteries. Better monitoring and reporting would allow us to develop critical mineral supply chains with partners that prevent human rights violations and environmental harm. So, mister Howell, what are the biggest gaps in current data and reporting systems for tracking the origin, processing, and trade of critical minerals?
Speaker 13
There are gaps in current data and reporting systems for tracking the origin, processing, and trade of critical minerals. So,
Speaker 9
At this point, there's really no consistency in the type of data that's gathered. And so bringing consistency to the important data characteristics of sources and refined products, and tracking those materials not only through extraction, but refining and end uses. And then also, you could add in recycled materials as well. And so you could develop a circular economy with many of these materials.
Speaker 13
So then, Mister Howe, how would legislation like the TRACE Act that I identified help address these gaps in data and reporting systems?
Speaker 9
Well, it would provide a structure for the department for agencies like the Department of Energy or the Department of Defense to actually start building out that database and informing industry in the requirements for the traceability of material.
Speaker 13
Thank you. I appreciate that. And, Miss Hunter, do you agree that the TRACE Act would help increase transparency in global critical mineral supply chains?
Speaker 6
Margressman, thank you for the question and your leadership on this issue. Transparency and standards have to go hand in hand on this. Transparency without standards lacks legitimacy. Standards without transparency lack consequence. If those are the goals we're searching for, then traceability is the mechanism.
We need to be able to strengthen existing policies like the weaker Forced Labor Prevention Act. We support obviously the trade act's endeavors here, and we also, especially with all of the 232 investigations and critical minerals, need to make sure that our harmonized tariff schedules actually reflect the different types of minerals along these complicated processing lines that I've talked about in my testimony, so we can be more concerted in making sure that we're encouraging manufacturers to, you know, buy domestic, buy allied, buy higher standard sources of supply and play on a level playing field for these minerals.
Speaker 13
Thank you. And the TRACE Act would create a digital identifier or battery passport that acts as a digital label for batteries, allowing end users to trace the origin of battery materials and components. These identifiers could help facilitate the transfer of information among stakeholders, including mining companies, original equipment manufacturers, recyclers, consumers, and regulators. So, mister Howell, do you agree that a traceability system could strengthen the US national security and create economic resilience?
Speaker 13
And, Miss Hunter, same question. Will the traceability and accountability system help strengthen our national security and improve the economic resilience of our critical mineral supply chains?
Speaker 6
We need to shine a flashlight on these opaque supply chains. So anything we can do on traceability that can help us, show that we're where we're getting materials now and then move away from adversaries is a very helpful step forward.
Speaker 13
Thank you. While digital battery identifiers are an emerging technology and concept, there are several private and public companies in consortia pursuing this important work, and I hope to see it continue. So I thank all of our panelists for their attention to these important matters, and we have to do more to bridge the gap and ensure our nation's economic resilience and security is there for the future. So with that, Mr. Chair, yield back.
Speaker 1
Thanks to the gentleman for his questions. Chair now recognizes the gentleman from Texas, Mr. Weber, for five minutes for his questions.
Speaker 10
Thank you, Mr. Chairman. It's Hunter. I'm gonna come to you first. And, miss Windy, you're not off the hook yet either, so I'll get to you second. Of the 50 critical minerals identified in 2022, 49 are essential to the energy sector.
May or may not know about my district, 14 has seven ports, more than member of congress, lots of energy, three LNG plants. I could go on. 49 of those essential energy sector, and we rely on China for 26 of them. Do that math. The US once led the world in producing and refining rare earth elements, but ceded that position to China in the nineteen eighties.
Today, China controls roughly 90, and I'm telling Noah about the flood here. Today, China controls roughly 90% of global rare earth processing and has already demonstrated a willingness to restrict exports, and thus, as one of y'all mentioned, affect the market. This leaves the US dangerously exposed. If China were to halt exports entirely, think of that scenario, where would we turn to secure the materials vital to our energy infrastructure and national security? I'll go with you first, Miss Hunter.
Speaker 6
So a total export ban would be devastating to the US economy. We would need to rely on domestic sources if we can get them online, and then have them be processed into the, you know, final products that need to be qualified by manufacturers to turn to allies as much as possible. Countries with which we share national security priorities, we have free trade agreements with, and also working with producing countries at scale. You know, it doesn't take a lot of time. Everyone on this panel has noted to build a mine, set up a processing facility, and connect it to downstream buyers.
So you need to look to existing producers at scale, as well as allied countries with expertise in this sector, to be able to fill the gap.
Speaker 10
Would it be a good policy, if the thought just occurs to me, to actually have a buildup of those minerals excess, even especially when you're talking about national security, our great, you know, fighting men and women. Is there a policy that we can build up excess materials that we get in China, or do we just buy them as we need? Do you know?
Speaker 6
We do have a national defense stockpile that sources these materials for defense purposes, and it has obviously a national security mandate, not an economic mandate for the energy minerals you've talked about. It's important to take into consideration things like shelf life, qualification, you know, the ability to distort the market by oversupplying it when you're considering this. So I'm sure others have thoughts on this, but it is something that exists that we could certainly strengthen and consider, but it's not the end all be all.
Speaker 10
But shelf life could be dealt with if you rotated your products through. Agreed?
Speaker 6
As long as you're working with processors and downstream buyers of the material so that we're making it in the manner and fashion that they need it to. But you need that midstream and downstream demand to be able to justify many of these economics.
Speaker 5
I do. I, but going back to the beginning of your question, I think that some of the other sources of minerals, if China completely cut us off, you know, we could look to Japan and Korea for some of the rare earth minerals as long as they also weren't cut off from China, which China has threatened Japan numerous times in the past and actually did implement a brief export ban on rare earths to Japan. So we'd have to be looking at who else China is cutting off.
Speaker 10
Well, although he didn't take the oath and didn't agree to testify, I'm gonna go back to our great chairman because I think I hear the chair have heard the chairman say that there's nine rare mines, China has eight of them. Is that right?
Speaker 1
There, there's not a single major refinery for rare earth elements in the Western Hemisphere. There's only 9 in the world. Eight are in China. The other one's in Malaysia. Owned by Linus, I believe.
The name of the Australian company.
Speaker 10
This leaves the US dangerously exposed, what we're talking. You know, I think we all agree on that. So understanding there's a more thorough, I understand that there's a more thorough mapping of the US is ongoing. Does the are we in The United States gonna have the natural resources to be able to produce those critical minerals if we could get the permitting quickly? If we had to go to this quickly, is that a feasible scenario? I'm not talking about having stuff stored on the shelf.
Yes, ma'am, Miss Rainy. See you chomping at the bit.
Speaker 5
I am chomping at the bit. We have vast mineral resources here. A lot of people do not understand how much we actually have. About 6,200,000,000,000 that are known. The US Geological Survey says that more is going to be found than we've already discovered to date, and they have identified 800 sites for potential critical mineral resources in the US.
Speaker 1
I might have been a little lax there if you'd kept going, but I think the general
Speaker 1
The chair now recognizes the general lady from Texas, Miss Fletcher, for five minutes for her questions. Oh. Oh, well, I'm sorry.
Speaker 1
I got it out of order. My bad. The chair now recognized General Ledger of New York, Miss Acasio Cortez.
Speaker 15
Thank you so much, mister chairman, and thank you as well for the generous and kind words you had to share about chairman Connolly and ranking member Connolly. And, he'll be very missed, and we will all miss his demeanor and his humor as well. So, thank you. I'm glad that we are here talking about our domestic critical mineral supply chain today, because it is an area that I do believe could be right for bipartisan collaboration. The truth is whether it's for our vehicles, our smartphones, or our national security, our economy does rely on having access to these minerals.
And because the cars and smartphones of tomorrow may rely on different mineral compositions than they do today, it is important that we and Congress continue to plan for resilient and reliable supply chains. As the former ranking member on the House Natural Resources, Energy, and Mineral Resources Subcommittee, I can say that the urgency behind these issues is something I've been grappling with up close for years. Now we've heard a lot about how crucial tax credits and low-cost lending are to our domestic critical mineral supply chain, all while Republicans today are slashing those very same programs in their reconciliation bill. And the rules committee, not too far away from here, we are marking up legislation that actually draws down a lot of the financial tools that both allow demand to be at the level necessary in these markets and also the lending that's required to allow these supply chains to flourish. But hearing the debate today, I would also like to focus on the solutions that I believe my colleagues on both sides of the aisle can agree on, namely grid storage and battery recycling.
Very often, we have this conversation about how we can increase production and how production can be aided, but we also very often don't look at the other end of this equation, which is that once batteries are in The United States, once they have been produced, once these minerals have been deployed, when they reach the end of their life, they don't have to go to a landfill. We can retain crucial elements of batteries and keep them in, and make them part of our supply chain through robust recycling. Mister Howell, in your testimony, you touched briefly on the notion of grid storage. Can you explain to people what grid storage is?
Speaker 9
So grid storage is basically dispatching energy storage in timeliness in the time that you need it. So whether it's renewable energies, whether it's conventional energies, storing that energy in some type of system. It can be a battery, but there are other types of grid storage as well, and then dispatching that when you need it.
Speaker 15
And how would investing in grid storage help us to support more reliable and affordable electricity?
Speaker 9
So the grid pretty much is built for peak demand each day. Mhmm. And so there is a great deal of power capability overnight. And so by storing that energy overnight, you can actually reduce the number of power distribution that you need.
Speaker 15
Yes. I think a lot of times folks don't, understandably, quite understand how our grid works. And, think a lot of people will be surprised to learn that once you generate the electricity necessary, it goes essentially right to its end use. And once that electricity is generated, it needs to be used pretty quickly. But storing it allows us to deploy it at times, produce it, and then deploy it.
And one area when it comes to minerals, there's often talk about competition with China. And one area that China has solidified is the area of battery recycling. In fact, by 2025, China is forecast to account for 78 to 89% of global battery recycling capacity. Mister Howell, why is developing domestic battery recycling important for our economic security as well as for domestic supply chains?
Speaker 9
It reduces our need for every critical material in the battery that we're talking about today. So our calculations when I was with the Department of Energy showed that by the early thirties, mid twenty thirties, that we could be actually recovering enough battery materials from recycled batteries to provide 30 to 40% of just about each of those critical minerals that we
Speaker 15
I think it's, I mean, this is something that I don't believe is being paid nearly enough attention to, where, yes, procurement of critical minerals is an important part of this process. But we will be endlessly dependent.
Speaker 15
and we will endlessly be scrambling on this if we don't also make investments in recycling. Going back to the topic of grid storage, how would investing in grid storage incentivize the development of domestic battery recycling plants?
Speaker 9
It just basically provides that, end use market for battery for investment in production capability of battery systems. And.
Speaker 1
The latest times expired. I do appreciate the dialogue on recycling batteries. We're getting a substantial amount, if not most, of our antimony from recycled batteries. Chair now recognizes the gentleman from Idaho, Mister Fulcher, for five minutes for his questions.
Speaker 16
Thank you, Mr. Chairman. And I'm gonna I'll give Miss Sweeney a heads up that I'm gonna be asking her for a lessons learned question here. But before I do, I just wanna set up the reason I'm asking that question as a bit of history. So in Idaho, the Stednite Mining District became active during World War One, 1914 to 1918, for extracting antimony and tungsten. These minerals were critical for munitions and weapons manufacturing.
During World War Two, Stivenite became the largest domestic supplier of antimony and provided 90% of domestic antimony used in the US war effort. Following the war, demand for these minerals declined sharply. And today, in 2025, if you can believe it, the United States has no domestic antimony mine. So a stigmate gold project located in Idaho aims to reestablish domestic antimony production. Once operational, it's projected to supply up to 35% of the antimony demand in the first six years, strengthening national security, and reducing dependence on foreign sources.
Until recently, China accounted for over 50 to 60% of global antimony production, and the Chinese government banned exports of antimony, gallium, germanium to the US. This intensified the urgency to restore domestic supply, and antimony trisulfide from stibnite remains the only known domestic source capable of meeting the US Department of Defense needs for small arms, munitions, and missiles. So, fast forward to now. In April '25, just a month ago, Stidnite Gold Project operated by Perpetua was designated as a priority project by the Trump administration in response to the worsening critical mineral crisis. After entering the formal federal permitting process in 2016, the project achieved a major milestone two days ago, just here, May 19, in federal permitting when it received its final federal authorization, section 404 Clean Water Act permit from US Corps of Engineers.
Now with all that history, I just wanna ask you, Miss Sweeney, from your vantage point, what are the lessons learned from this project? I know this is not the only one that has gone through similar types of processes. Just like to get your vantage point. What's the lesson learned we can use from this?
Speaker 5
So I think there are several lessons to be learned here, and thank you for the question. I think the first one is really highlighting the importance of byproduct material. So antimony is going to be a byproduct of gold production. So if the gold production were not economic, that antimony would not be mined at all. Secondly, the permitting process clearly took a very long time for Perpetua when they really were actively going out there and cleaning up nearby old mine tailings and mine sites while they were trying to move forward.
They were trying to do everything in the right way. The third is the need for litigation reform, because this project is being litigated. And one of the issues that is being raised is one that could be addressed by Congress through the Mining Regulatory Clarity Act, which I know has received some bipartisan support right here in the House.
Speaker 16
Thank you for that. I think if I understand it correctly, although the permit was initiated in 2016, it's been about an 18 year process. Something.
Speaker 5
Absolutely. It's really, and they've spent, you know, hundreds of millions of dollars just to get to the point of putting in their permit for approval.
Speaker 7
In my last year in the Trump administration, this is permitting lead. I flew out there towards the site with Governor Little. It's important to keep in mind that the lost revenue, the cost is gonna prevent the tax revenue that will be generated from that project in the out years because of how much money it's losing on the front end. But it's important to point out that mining is entirely supported by private capital, unlike the rest of the world. Had had perpetuated and might us not put the money at risk on a legacy site that it is gonna give us better environmental outcomes than if they had done nothing. It is important to keep in mind that that project, much like many of the other brownfield projects in the country, are going back to legacy mines from World War two, fixing them, restoring hydrological resources, and leaving it better than when they got there.
And perpetuate doesn't get enough credit for that.
Speaker 16
Thank you, Matt. Mister chairman, I'm out of time. However, I'm gonna send Mister Hertgo a follow-up question having to do with the role of land management agencies, and I'd like to get your input on that as well. Mister chairman, yield back.
Speaker 1
Thanks, gentlemen. The chair now recognizes the gentleman from Texas, Miss Fletcher, for five minutes for her questions.
Speaker 14
Well, thank you so much, Chairman Palmer, and thanks to you and Ranking Member Clark for holding this hearing. I really am glad to work with both of you on the important issues that come before this subcommittee. And I agree with my colleague that this is an area with real potential for us to work together and find bipartisan agreement. So I also wanna thank all of our witnesses who are here today sharing your insights and helping us find where we can find that agreement, and understand the landscape where we're having this conversation. And it does seem to me, in the greater context of what's happening on the hill this week and what we're doing, that we seem to be talking past each other about a lot of these issues.
We've already heard a little bit about it this morning, but I really think it bears repeating that the Inflation Reduction Act and the bipartisan infrastructure law that Congress passed was designed to make important investments to expand the domestic energy industry and to reduce our reliance on China and other foreign countries, and to make sure that we were manufacturing at home, that we could be energy independent, that we could expand and grow, and we could be supplying the rest of the world with clean energy technologies as well as continuing our work in traditional energy sectors. I represent the people of Houston, Texas. It's the energy capital of the world, and we certainly have been exporting our expertise and knowledge in all areas of energy and see a future where that is something we can and should continue to do. But, you know, as we all know, it's just hugely important that we invest in developing full domestic supply chains for critical minerals, and that that's so important as the demand for these minerals is only gonna continue to grow, and that it's important for our national security. So, you know, we need to be onshoring this process in a resilient and smart way, and we need to be talking to each other about how we do that.
I think this hearing is helpful to that. But I do have to note that, you know, just last week, every Republican on this committee voted to weaken our supply chain for critical minerals, when we voted on this budget bill that's making its way through the house right now, and that is currently being debated and considered in the rules committee. You know, this budget bill rolls back hugely important investments that we made in the inflation reduction act and in the bipartisan infrastructure law to expand the domestic energy industry and to reduce our reliance on China and other foreign countries. So we seem to be talking past each other when we really should be thinking about all of these things holistically. And I do wanna note, mister Hergo, I appreciated your testimony and observations on the importance of permitting reform. That is something that I support, that I have been working on this committee.
And I agree that Congress should be able to get it done. We should be able to get it done on this committee, and I hope that this committee will really be able to advance that effort in this Congress. With that said and with the time we have left, I do think it's important to understand better how some of the efforts that we're seeing in the administration, and some of the efforts to repeal these important investments as well as this overall kind of atmosphere of uncertainty that I'm certainly hearing about from my constituents, is affecting the energy and the critical minerals industry. And so with that, I do want to turn to you, Mister Howell, because of your background both in the government and in the private sector. I think you've got a great perspective here.
To just share with us your thoughts on how you expect that companies in The United States that are part of the critical mineral supply chain might react in response to repealing these IRA investments and tax credits, and, also, how that might affect innovation and investment in more US manufacturing.
Speaker 9
Thank you for that question, madam Congresswoman. Consistency and predictability are so important to the private sector. And, you know, there's lots of tools that the federal government can employ to support critical minerals and processing in The United States. We talk a lot about tariffs, but production tax credits are so important. Investment tax credits.
Grant programs that support the buydown of risk to the private sector are important, like the IIJA 40207 program that I mentioned. You know, when I was with the Department of Energy, for every dollar spent, 2$ of private sector investment was spent on those programs. And, of course, the loan program office. All of these, it's not one size fits all for our industry colleagues in our back coalition. They look for all of these levers, but specifically, they do want some consistency, transparency.
They do want predictability, and their shareholders, their financial backers, want the same.
Speaker 14
Well, thank you so much. I'm out of time, but I do have a couple more questions for you. I will submit them for the record, and I will yield back. Thank you.
Speaker 1
Thank you. The chair now recognized the gentleman from Ohio, Mister Ruley, for five minutes for his question.
Speaker 17
Thank you, chairman. The question would be for Miss Sweeney and Mister Hammond. What facts are, so what factors does a company consider when they're thinking about what location in the United States of America that a processing or refinery facility would be in?
Speaker 17
Or so what would be the parameters or the factors when you're looking at different locations? I mean, the Continental United States is so vast in area and every resource and highway and stuff. What factors would play into that development?
Speaker 5
So, certainly, ore grade would be a big factor, but we certainly there are companies that try to avoid federal lands at all costs because the permitting process for federal lands takes so much longer because there are more agencies involved and it almost always triggers NEPA, whereas if you're on state or private lands, you can move your project forward that much more quickly.
Speaker 8
Mister Hammond, do you have a comment? Sure. So echoing what Katie said, with mining, you have to go where the minerals are. Right? Sounds like common sense, but that's just the way it is.
They're not coming to you. You have to go to them. But in particular, where you choose is also gonna be a matter of where the most favorable regulatory environment. And I agree with Katie as well. For many people, doing that on federal land is gonna be more of a problem than it's worth.
So you're gonna look for state or private.
Speaker 17
Mister Hammond, in your written statement, you said that you decided that the company decided to skip development opportunities on federal land when the development was right next to an existing project on state or private land. I know in the state of Ohio, a company from West Virginia, Infinity, was granted the right to drill on state lands. And there was a very compassionate, very conscious acknowledgment of the preservation of the environment impact. I think anyone that's involved with minerals, we understand that Mother Earth needs to be protected at all costs. In this case, in particular, I think they decided that there was already a private piece of property that was right next to it that was already doing drilling.
So they decided to use that property to pay for an additional contract with people that they didn't have to, because they already had the state contract. So in all due respect to the preservation of an environment, they chose to go on the private land and do horizontal drilling into the state land, so there would be no surface impact on the state property. I thought this was a logical approach to the pathway forward for the development of minerals in America. But we see that there's a big difference when you look at private land, state land, and federal land. So I think you already started the parameters of how it looks like when you're playing around with the federal land, with the hiccups and the road bumps that we have in place for that.
Do you see a pathway forward, either one of you, on how we get past these roadblocks?
Speaker 5
More efficient permitting for federal lands, I think, is the direction we need to go. That means more efficient NEPA reviews, environmental assessments, and environmental impact statements. You know, the Congress has already told the agencies how long it should take. And I think that there have been some projects where those deadlines have been ignored or the companies have been told that they need to request an extension rather than trying to push those timelines.
Speaker 5
We need, yeah, we need people to implement what Congress told them to do.
Speaker 8
Sure. I think Katie's right. It comes down to permitting reform. But one thing in particular that I was focusing on in my testimony is concurrent review, or consecutive reviews as opposed to parallel or concurrent. And that's the example I was talking about with respect to uranium, where a project proponent was going through the process but then kept having new requirements dumped on them and extending out the time of the review.
So, I mean, what I think will be most effective is if you tell a project proponent on day zero what exactly you're gonna need to get through all the way through the permitting process. That's the fair way to do it, and that's the efficient way to do it.
Speaker 1
I thank the gentleman. The chair now recognizes this gentleman from Georgia, Mister Allen, for five minutes for his questions.
Speaker 18
Thank you, Mr. Chairman, for holding this important hearing. I wanna thank the witnesses for testifying today. Obviously, we've highlighted the importance of critical minerals in our everyday life, and, while we should not be reliant on China for those critical materials. And it's a matter of national and economic security that the US be a leader in this critical mineral economy. Miss Sweeney, what is the status of critical minerals mining in the US, and how has the US capacity changed over time, particularly in the last administration?
Speaker 5
So in 2022, we became our most important reliant ever. So the trend lines have not been great. We used to be a leader of many of these supply chains, particularly directly after World War two and into the Cold War. But we have ceded that territory mainly to China. And with that, we cede all the economic value that goes with the processing of those minerals.
Speaker 18
Critical minerals production and refining are energy intensive processes. We're to build up domestic energy to help supply critical materials. Are there any energy infrastructure components that we need to consider?
Speaker 7
I think you keep on a very important issue. In order to scale up on processing, you gotta power up, and the mining companies will pay for it if you give them the certainty to on a reasonable pathway forward. You're absolutely correct. And it's not just on the energy. It's also on the rail and other infrastructure as well.
Speaker 5
Yeah. I think we need to make sure that we're considering reliable, affordable baseload power.
Speaker 18
Right. Exactly. Miss, Miss Hunter, when China began investing in the critical mineral supply chain in the eighties and nineties, they went from a small share of the market, and now they dominate the market. In 2023, the US produced less than 20% of China's output. How did China end up monopolizing the market like this?
Speaker 6
This is a very concerted long-term strategy that the CCP has been laying out and implementing for decades. The Made in China 2025 plan really delineates clearly what they're trying to do with increasing imports of feedstock materials, leveraging recycled inputs, and then dominating in the processing midstream so that they can lead on advanced technologies that rely on these technically converted materials. They use illegal subsidies, direct and indirect. They use 57,000,000,000 dollars in lending to foreign nations between 2020, 2021 to access minerals abroad. And they use market manipulation tools that have been talked about already, dictating prices and influencing them in their favor, consolidating their market control.
Speaker 18
Well, we've watched this for some time, and, I don't know, you know, why the alarm bells have not gone off before now. And, of course, we're dealing with again, congress is saying we gotta get this done, and then the agencies are like, well, you know, we have to delay it further. I mean, it's critical. I mean, what lessons can we learn from this, from their monopolization of this going forward, and how do we get off the dime here?
Speaker 6
I'm always reluctant to say we should take a page from the CCP's book, but their consistency on policy and then also monitoring the market dynamics and competitors to adjust as needed has been very successful in maintaining their control. So given the bipartisan nature of this issue, I think consistency and leveraging whatever we can to help American competitiveness, but also, supporting a diversification of the market will insulate us from the undue control that they exert over us today. I agree with your assessment. We cannot continue to operate complacently.
Speaker 18
Well, I'm about out of time, but I've got a few more questions here that I'll submit for the record. Thank you again very much for your testimony. And, obviously, we've gotta get off the dime here and get with it, and I think we'll figure that out. Thank you for your help. I yield back.
Speaker 1
Gentleman yields. The chair now recognized a gentleman from Texas, Mr. Crenshaw, for five minutes for his questions.
Speaker 19
Thank you, Mr. Chairman. Thank you to all our witnesses for being here. Critical minerals are the backbone of a modern economy and a modern military, from semiconductors to advanced weapon systems. But today, the US imports between 50-82% of the critical minerals we need. So where are they coming from?
It's been mentioned plenty of times here. They're coming from China. That's not good. Our national security, our national industrial base, our economic future dependent on supply chains we don't control from regimes we cannot trust. And why?
Well, mostly because our laws and regulations made it virtually impossible to open up new mines in this country. And even when we do mine, we still have to ship the raw materials overseas just to get them refined because we've offshored our processing capabilities. I wanna commend the Trump administration for taking some meaningful steps to address this with executive action. The executive order on critical minerals was a step in the right direction by cutting red tape, but we need to codify this. This is Congress' responsibility, and we're behind.
You know, China didn't dominate this space by accident. It's a long game. Decades of strategic investments in resource-rich nations across Africa, Asia, Latin America. In 2023, China was the top supplier for 29 out of the 50 critical minerals identified by the US Geological Survey. So that's what it looks like when a global adversary plays chess, and we're still playing checkers.
And I think it's time we act serious about this, start securing our supply chains, rebuilding our refining capacity, cutting the red tape that's left us dependent and vulnerable. I might add, I think this is becoming more of a bipartisan issue. I think everybody starts to realize we need these critical minerals. My question, my first question, for mister Hammond. Can you explain how one of the problems we have is there's a lot of radical environmental groups hold up critical mineral, mining and related infrastructure projects throughout the court system.
I mean, it's not just critical mining. It's sometimes an off ramp of a highway. How could we address that?
Speaker 8
So that's an incredible issue that you've brought up, and it's a huge problem. I spoke earlier about the judicial reform. What happens is you can go through, as we've talked about earlier, decades-long process to get a mine off the ground. It could be approved by an agency, but an unfriendly environmental group can drop in, file litigation, and tie that same project up for additional years or kill it altogether. Capital only has, you know, can wait around for only so long before it goes to another place.
So that's just one way that they have in their toolbox to kill our progress on mining.
Speaker 19
Yeah. It is bull. I'm not sure it would be in our jurisdiction for judicial review, but is there any particular bills that come to mind that seek to fix this problem that we should be aware of?
Speaker 8
So over the years, I think, likely a judiciary, but also natural resources. They've looked at what's called the EJA reform. Basically, under EJA, you can file litigation, then go to the judge, and he can award you attorney's fees at the end. So we're basically, as a federal government, financing litigation against ourselves.
Speaker 19
That doesn't make sense. What about unworkable environmental regulations that affect investment decisions for companies looking to develop domestic critical mining production or mineral production?
Speaker 8
Sure. So if you are a company that's looking to get involved in this business or expand operations in this country, it's fairly intimidating to look down the barrel of the regulations that we've set forth. So what I've I think the solution is giving consistent and early guidance to companies on what the federal government is gonna require to get through a permitting process. An investor recently told me that if you want to unleash hundreds or billions of dollars in mining in the near future, tell a company that you're gonna do an EIS in a year and not four years. And then they'll get really interested and money will start to flow.
Speaker 19
Yeah. As general question, I mean, we do we have those resources here in The United States that are just untapped?
Speaker 8
Yes. I think we spoke about that a little sooner. But yes, we have abundant critical minerals in this country. I think in the state of Utah alone, we have 40 of 50 critical minerals. So now look at California, Arizona, and so on.
We have the potential here.
Speaker 7
Yep. I think it's important to keep in mind that we can't have a piecemeal, segmented process. We need to have the mineral extraction, the processing, and the energy all at the same time, or else we're not doing what we actually need to do to create the integrated supply chain.
Speaker 19
That kinda gets my next question in my limited time with, for Miss Sweeney. You know, China actively pursuing all these projects around the world. They have the full supply chain that you mentioned. Is there any example in the United States where we have a full supply chain for any critical mineral?
Speaker 5
Beryllium comes to mind, mined in Utah, processed in various facilities that are all under materials and natural resources.
Speaker 19
So perhaps that case study requires more of our attention, how we did that, and maybe we can be replicated. I'm out of time. I yield back. Thank you.
Speaker 1
Gentlemen Yields, chair now recognizes gentle lady from Florida, Miss Castro, for five minutes for her questions.
Speaker 20
Well, thank you, Mr. Chairman. I do believe that there is room for bipartisan cooperation and progress here over the past term in congress. Congressman Rob Whitman and I led a critical minerals working group out of the select committee on countering the Chinese Communist Party. Some of you were instrumental in helping us develop recommendations, so I highlight those to the energy and commerce committee. We actually hammered out a few pieces of legislation as well.
But I have to admit, I'm very frustrated by this. I think this hearing comes, it's so inconsistent because so much of the progress that we've made over the past two administrations is being sabotaged right now. A lot of it's coming in the billionaire boondoggle bill, that it will take away a lot of the investments that we've made in shoring up our domestic critical mineral supply chains and strategies. We remember, we invested through the bipartisan infrastructure law at DOE for battery materials processing, to help US manufacturers expand what they're doing on processing and domestic supply. We, the DOE loan program office, you know, you're going after that in the billionaire Bountuga bill.
That is the office, loan program office that is helping the private sector make these important investments in domestic critical mineral supply chains from mining to processing to reshoring. And then we know that you have the important pieces of the Inflation Reduction Act also in your sight. So you're taking you're kinda taking the best tools we've developed over the past few years away from being able to strengthen our supply chains. And then you bring in this arbitrary tariff policy too, where you're poking our partners and allies like Canada and Australia, imposing tariffs on them. So how you know, I think my Republican colleagues in this administration have lost a strategic focus when it comes to how we build our own domestic supply chains here and incentivize the private sector to get involved.
One example, Miss Hunter, you testified in front of our critical minerals work group. Thank you very much. Is the 30 d clean vehicle tax credit that now is, in the billionaire tax giveaway. They want to take that away. How will that impact our ability here in The US to bolster our domestic critical mineral supply chain?
And how will that impact our national security?
Speaker 6
So I haven't seen any of the final versions of the reconciliation text. So please take this with my need to get back and review it for further comments. But a successful critical minerals policy does leverage the US demand sectors that we've talked about with policy handcuffs that encourage them to source domestically as much as possible, and then also avoid sourcing from adversaries. That's extremely critical, and it must be well sequenced with the market. Similarly, we have to counteract cost disadvantages at home.
The 45x tax credit does help attract investment here consistently over a long period of time. And without that, we risk the continued disinterest of investors and producers looking at the United States as an opportunity to process. So I do think that we risk undermining the president's very clear agenda for unleashing American minerals and making sure we leverage domestic processing if unintentionally by foregoing some of these important considerations and policy today.
Speaker 20
Thank you. Mister Hall, you did very important work at the Department of Energy's Manufacturing and Energy Supply Chains Office. Reporting at the 2024, it was suggested that DOE was considering as well how to do more to support US critical minerals projects, working with all sorts of grant recipients that were struggling due to Chinese dumping and price manipulation. Where should we go from here? I mean, that's the jurisdiction of this committee, oversight of that office.
What can we do to support those efforts? And I know the demand signal is important, but what do you recommend to the committee?
Speaker 9
So thank you, Congresswoman. Very important, you know, the IIJA battery manufacturing grant program, very important to the battery industry. It provides that high risk, high reward leveraging of the private sector funding to install, first of a kind, in many cases, first of a kind production capacity in the United States. And, you know, it takes time to actually launch those programs and then see production, materials coming from them. So a consistent support for that, a continuation of the execution of that program is going to be so important.
And for those companies that may be struggling in the near term, the 30 d tax credits basically do provide that market pull for those materials that are gonna be coming out of those facilities once they are actually in production.
Speaker 1
Gentle lady yields. The chair now recognizes the vice chairman of the full committee, the gentleman from Pennsylvania, Doctor Joyce, for five minutes for his questions.
Speaker 21
Thank you, Chairman Palmer and Ranking Member Clark, for holding this important hearing, and thank you to our witnesses for testifying. Critical materials, specifically critical minerals, are required in many areas of manufacturing, ranging from products as simple as a sunscreen to light bulbs to vital energy and to defense applications. A supply, a steady supply of critical minerals is essential to protect America's economic and national security. Unfortunately, for decades, we have ceded our advantage in the production and refining of these materials to other countries, specifically China. Over the last few years, we've seen the consequences of this domestic inaction as China bans or severely limits exports to the US of critical minerals essential to our national security.
Let's be clear. We cannot continue to allow our biggest adversary to control the supply chain for these materials. That's why President Trump has taken executive action declaring a national energy emergency and aiming to increase domestic production and the refining of critical minerals. However, executive action alone might not be enough to provide a stable environment to attract new investment in the critical mineral supply chain. Mister Hammond, in your written statement, you discussed projects that languish indefinitely due to politics, including a permit to conduct due diligence on a potential mine that took three years under the last administration, as opposed to the standard three months.
Would you please elaborate on how the priorities of an administration can affect the implementation of the permitting process?
Speaker 8
Sure. Someone can say that critical minerals is important, but if it's not a priority for administration, you're not gonna make any progress. In that case, like I said, a project stood still for three years for something that should have taken a matter of weeks. It was a project to drill sample holes from the back of a truck. So it took 3 years, and this is just exploration.
It's not even a full-blown mine. It's just to see if we should build a mine there. Now the rest of the story of that is even worse. They were ultimately sued, and even that project is now held up.
Speaker 21
Incredibly unfortunate, revealing information you have provided to us. How can we ease companies' concerns over the instability in political environments to ensure that the forward momentum of the Trump administration remains through future administrations, Mr. Hammond?
Speaker 8
Sure. I think this congress needs to look, as we've said earlier, permitting reform. I don't even like the term permitting reform, because it's used so generically now. So more specifically, we have to look at narrowing the scope of NEPA and looking at exactly what we require of project applicants. If you want to do a project in this committee room, you'd want to study the committee room.
Right? You might even study the Rayburn Building because it'll probably impact the rest of the Rayburn Building. But the way things stand right now in the mining community, you're not only gonna be looking at the Ray at this hearing room, the Rayburn Building. You're probably also looking at the Dirksen Senate Building over there as well, to see what the impacts are. It doesn't make any sense.
Speaker 21
You have to narrow the focus of what project proponents are required to study. Recognizing it's a chilling effect that you're describing on instability, how that can affect domestic investments. This committee included a provision in the reconciliation bill to establish a derisking compensation program at the Department of Energy. Under this program, applicants would be compensated for unrecoverable capital losses resulting from federal actions that previously made federal permitting projects unviable. How would a program that we're including in this upcoming legislation, which includes critical mineral projects as eligible applicants, provide certainty to businesses and spur the investment that is so necessary when it comes to critical minerals, Mister Hammond?
Speaker 8
So I think a project proponent would look at that and see that the federal government is making a commitment. That would build confidence, and that's ultimately what you need before you make any kind of investment decision, and you're derisking that decision. So anything we can do to build confidence through a program like that, I think the president's also talked about something similar, that if a future administration comes along and yanks a project like in the case of Keystone XL, there would be compensation involved to make a future administration think twice before they just yanked a project that has already had.
Speaker 21
Billions of dollars invested in it. Under President Trump and with cooperation from energy and commerce, this committee, we look to build that confidence. We must do more to capitalize on the positive progress that President Trump has achieved in such a short time. And I look forward to working with stakeholders as well as my colleagues on this committee to take advantage of this finite opportunity. I thank you all for appearing here today.
Mister chairman, I yield back.
Speaker 1
Gentleman yields. The chair now recognized himself for five minutes of questions. Miss Hunter, you said something at the very beginning that caught my attention about China's strategic leveraging and the bottleneck that has been created. We've got access to rare thumblets here in the United States, and critical minerals. We have the seventh most known reserves.
So when you, it's not a matter of having them. It's what we're able to do with them once we get them. So, would you like to comment on that?
Speaker 6
We do have great progress, especially on the light rare earths domestically. That's something that's a bright spot. But until we can separate them, turn them into metal, things that are happening in the states that have been represented today, then ultimately, we can't use them in the permanent magnets or robotic systems, defense applications or energy solutions that we want to. So separation, metallization, are key.
Speaker 1
We it's been mentioned that we could get rare earth elements from recycling products. I think we get about 18% of our antimony from recycled car batteries. We can recycle hard drives, and computer equipment. There's waste that we can recycle. And when I say that, we're talking about mine tailings and coal ash, things like that.
Would that be sufficient to meet our needs, particularly in regard to our national security?
Speaker 6
So defense demand for these materials is substantially smaller than the commercial demand. So without having the numbers, and I can follow-up with your staff to validate, we could make great progress using all forms of alternatives. Another way is to decrease demand for some commercial applications through, you know, alternative abundant source non rare earth magnets in certain applications, and definitely leveraging full value mining as much as if.
Speaker 6
But so use it in specific applications, so not for defense applications, so that we can then leverage the higher quality and qualified material for the defense applications in certain instances. So we have to yes, and all of it.
Speaker 1
If you look at it in the context of economic security, it runs parallel with national security. I don't think we can supply our needs just through recycling, but I do think recycling is a viable solution. Miss Sweeney, when we talk about mining, right now, 95% of the rare concentrates that we produce in the United States are being exported to China for processing. And one of the points that I've made to the Trump administration is that the day we permit the mine, we need to permit the processing and the smelting and refining. So comment on the importance of a collaborative effort to get all this done almost simultaneously, and that doesn't mean we'll if we start today, we'll have it tomorrow.
I work for two international engineering companies. A pretty good idea of how long it takes to build something.
Speaker 5
You know, it's really important to scale up the mining and the processing together. That has to be coordinated to really secure our supply chains. China has been able to do just that in their investments around the world and in their own country, and they get the value, the value add of the processing, and that's something we're missing out on. And we import 171,000,000,000 worth of refined minerals last year alone.
Speaker 1
Well, that's something mister Hergot mentioned in his written testimony that we've were stalling over a trillion dollars in US infrastructure investment. It and there's that, the extension of what it does for the economy when you have this. And it's not just the mine or the processor or the smelter or the refiner. There are other industries that are involved in that. And it's not just federal permitting, Mr. Hergot.
There are other state and local governments that are involved. Talk a little bit about how we need to address this, because I do think this is not only an economic security issue. It is a pressing national security issue. Microphone, please.
Speaker 7
There is where there is a federal interest, because it's entirely supported by the private sector, these backbone industries, the fact that the neodymium that is in your microphone, we give to China at a dollar. They sell it back to us at $500. And even as of this month, the architect of the capital is gonna ask for a waiver to buy more from China for our own hearing room.
Speaker 1
But I just noticed I'm so short on time. I have another question I wanna ask you specifically. You mentioned China's aging, processing, and refining capacity. I think that's an enormous opportunity for The United States if we will act to build these capacities ourselves. Could you comment on that?
Speaker 7
Yeah. Very quickly. The Trump executive order is happening right at the same time that this window is opening up with China that will have a 10 to one impact on any money that was produced by the IRA because that certainty is multiplied by the investment that is pouring into The United States that then has a multiplier effect of state and local income and the induced labor. So, this is the window to do it. They are retooling and refabricating their processing, refinements, separating, and metallurgic processes that they built 20 years ago to beat us the first time.
They can't reach the purity levels to meet the AI, the semiconductor. And as I mentioned before, it's gonna take them five, six years to do that because they spent too much money developing dirty extraction processes in Mozambique and Indonesia and elsewhere. This is the window to do it.
Speaker 1
Thank you, gentlemen. Just as a comment, I really do believe this is a bipartisan issue, and I think everybody on this subcommittee and the full committee takes this very seriously. So I look forward to working with my colleagues. Seeing there's no further members wishing to ask questions, I would like to thank our witnesses again for being here today. Ask unanimous consent to insert into the record of the document included on the staff hearing documents list.
Without objection, that will be the order. Pursuant to committee rules, I remind members that they have 10 business days to submit additional questions for the record, and ask that the witness submit their response within 10 business days upon receipt of the questions. Without objection, the subcommittee is adjourned.
Ask anything about this video — I analyse its transcript to answer.