EU-funded EIT Raw Materials wants the bloc to use the upcoming legislation to speed up permitting and encourage investment in projects for materials that are needed to meet climate change targets. EIT Chief Executive Schäfer warned that Europe could struggle to compete with not only China but with the United States as well, especially after the approval of Biden Administration’s Inflation Reduction Act (IRA), which provides subsidies to encourage investment.

“We all know Europe isn’t as agile and quick when it comes to decision-making. The Americans take the fast track and the super fast track has been taken by the Chinese,” Schäfer said.

EIT is implementing an EU plan to provide the critical raw materials needed to meet the bloc’s target of moving to net zero greenhouse gas emissions by 2050.

The EU is set to publish its Critical Raw Materials Act in the first quarter of this year to secure critical raw materials used in energy transition technologies, including electric vehicles (EVs) and renewable energy equipment.

Both the EU and United States are seeking to curb their dependence on China, which supplies about 95% of the EU’s rare earths.

Fast-track permitting should be allowed for projects regarded as having strategic importance to the bloc, while still keeping high environmental, social and governance (ESG) standards, Schäfer said.

“In China you get a permit for a mine in three months as opposed to 15-to-17 years in Europe.” he pointed out.

Schäfer also stated that the proposed EU law should create a state-supported agency to act as a clearing house to match demand from industry with supplies from mining and processing companies.

The fact that U.S. IRA is offering a total of $369 billion worth of tax subsidies, large amounts of funding will be needed to lure investment to European efforts.

“We certainly have to build a counterweight to balance this otherwise all the remaining investment into the European continent will be dissipating,” Schäfer said.

As a start, EIT proposes an investment fund to help finance projects worth up to €100 million, another €3 billion in grants for sustainable mining projects and an additional €2 billion to boost research and innovation capacity.