How China's Grip on Metals Could Crush Biden's Clean Energy Plans

President Joe Biden outlined an aggressive green energy transition plan in the Inflation Reduction Act (IRA), which aims make America a world leader in low-carbon technology.

But the United States will face setbacks unless it can access the metals and minerals needed to make the plan a reality—as archrival China has already secured the lion's share of the world's supplies, which primarily come from mines in Africa.

While the U.S. has spent money attempting to quell the rise of Islamist groups on the continent, China—and, to an extent, Russia—have built ties with many of Africa's leaders to lock down the vital resources needed to lead the green energy transition.

Now experts warn that Beijing has stolen a march on Washington in the battle for materials vital to what is shaping up to be one of the biggest challenges and economic drivers of the 21st century.

They told Newsweek that the U.S. needs a two-pronged strategy. First, it must build better diplomatic and commercial relationships with African countries. Second, it should support technological advances that will reduce dependence on a sector dominated by China.

A Green Revolution

The IRA, signed into law in August 2022, set aside $369 billion to encourage a green energy transition in the U.S. The law aims for a 40 percent reduction in America's carbon emissions by 2030 while also striving to spur growth in the green energy sector by providing tax credits for the purchase of electric vehicles and solar panels.

The IRA has already started attracting battery companies to build gigifactories, or facilities designed to create components or products needed for electrification and decarbonization technologies, on U.S. soil. In November 2022, Norway-based gigafactory company FREYR Battery announced plans for a U.S. battery production facility in Georgia just three months after Biden signed the IRA into law, according to a report by Energy Storage News. Turkish firm Kontrolmatik announced plans for a battery plant in South Carolina and expects to receive more than $900 million in incentives from the IRA for its U.S. projects, Energy Storage News reported.

Many car companies, such as Ford, Stellantis and Toyota, had already announced battery plants in the U.S. before the IRA was passed. Volkswagen, which broke ground on a battery engineering lab in Chattanooga, Tennessee, in 2020, opted to build its first battery cell factory outside of Europe in Canada, citing the country's access to raw materials in a decision made earlier this year. The company will still benefit from the IRA incentives, since tax credits are offered to products "made in North America", which includes Canada, according to a report by the Financial Times.

Some experts argue the U.S. lacks the domestic infrastructure—such as charging stations—it needs to accompany a growth spurt in electric vehicle purchases, but America also faces an even larger hurdle on the global supply chain front: China.

Electric vehicles run on batteries that use lithium, cobalt and other minerals and metals. The U.S. currently has but one cobalt mine in Idaho and one lithium mine in Nevada, so will need to import most of these materials to meet its needs.

Meanwhile, China—which has been actively working on a global infrastructure development strategy for 10 years with its Belt and Road Initiative that has invested in more than 150 countries—dominates the sector, Jackson Ewing, the director of energy and climate policy at Duke University's Nicholas Institute for Energy, Environment and Sustainability, told Newsweek.

"China now refines over half of the lithium and cobalt and rare earth in the world," Ewing said. "They are deeply entrenched in the supply chains coming out of Africa and beyond to secure those raw materials and are processing them. China processes about 75 percent of all lithium-ion batteries."

"At present they are dominating the electric vehicle sector," Ewing added.

Through the IRA, the U.S. is striving to implement a domestic supply chain to increase accessibility to the materials while bridging access to countries that the U.S. is "more comfortable doing business with" other than China, according to Ewing. This is why the U.S. is entering into new deals with critical minerals—such as obtaining mining rights—and attempting to improve trade connectivity outside of China.

One continent the U.S. is honing its focus on is Africa, which is ripe with cobalt and lithium. China has a yearslong head start in Africa that was furthered with the Belt and Road Initiative, and the U.S. is scrambling to catch up.

Two African countries the U.S. is working with are Zambia and the Democratic Republic of the Congo (DRC). Last December, the U.S. signed a memorandum of understanding (MOU) with the two countries to develop a supply chain for electric vehicle batteries. The DRC produces more than 70 percent of the world's cobalt. Zambia is the world's sixth-largest copper producer, and the second largest cobalt producer in Africa, according to a press release from the U.S. Department of State.

"The United States will support the commitment between the Democratic Republic of Congo (DRC) and Zambia to develop jointly a supply chain for electric vehicle batteries," the press release said. "The MOU supports the DRC and Zambia's goal of building a productive supply chain, from the mine to the assembly line, while also committing to respect international standards to prevent, detect, and take legal action to fight corruption throughout this process."

However, there's still much more work to be done.

"Our presence in Africa is less than desirable and China's presence is significant now," Henry Lee, a director of the Environment and Natural Resources Program at Harvard, told Newsweek.

Twenty to 25 percent of the foreign aid in Africa is from China, Lee said.

"They have an active and aggressive presence in a lot of these African countries, and the U.S. has almost no presence," Lee said.

Relationships with African leaders are paramount, of which China has many. China has influenced African decisions for years, and Lee said the U.S. lacks vital relationships that could bridge the gap in acquiring raw materials.

Human Rights and Counterterrorism

Despite having some major catching-up to do, the U.S. can offer attractive terms to the countries it partners with for mining and processing.

Samantha Gross, director of the Energy, Security and Climate Initiative at the Brookings Institution, said that China is less attentive to environmental and human rights requirements but encourages its partners to use Chinese equipment while mining and processing.

"[The U.S.] might have terms that are more focused on environmental and human rights safety but less focused on requiring countries to use American mining equipment, and that might be attractive," Gross told Newsweek.

To become competitive, the U.S. must think about what various countries want and put together a package that appeals to them, but "China does have a head start, it's no question," Gross said.

The U.S. could also shift its focus to more competitive markets, such as in Indonesia, where it still can edge out China. Indonesia has major nickel reserves but "doesn't have the kinds of extraction and processing infrastructure and expertise and abilities in place to take full advantage of that," Ewing said.

Nickel is used in electric vehicle batteries and solar panels. In Indonesia, according to Ewing, the competition is "playing out in real time" as opposed to Africa, where China already dominates the market.

While China built connections in Africa for gaining materials used in green energy, the U.S. was sending troops and billions of dollars of military aid to the continent to thwart the threat of terrorism. According to an April report from the Costs of War project at Brown University's Watson Institute, the U.S. spent more than $2.5 billion on counterterrorism assistance in Somalia alone since 2007, and that figure doesn't include undisclosed spending on U.S. military and intelligence operations.

The U.S. also has more than 1,000 troops stationed in Niger, which was frequently mentioned following the country's recent coup. But as the U.S. military presence grew in Africa, so did Russia's.

The Russian Connection

Northwestern University political science professor William Reno, who spent time in Niger and Mali last year on a U.S. Defense Department-funded military training project, said Russia "was largely absent from Africa to about 2015."

"Since then, its model of engagement has been to provide direct security guarantees to governments in return for commercial concessions, primarily in mining," Reno told Newsweek. "The usual pattern is to partner with a newly installed and unstable military government that appreciates foreigners that can act as palace guards. The Wagner Group plays this role."

In this regard, Russia provides a different set of obstacles for America's hopes of breaking through in Africa.

"China has been a more conventional competitor. Its investments in infrastructure are appreciated in the region," Reno said. Russia—through Wagner—however, props up unstable governments that often are not the easiest negotiating partners for the U.S.

Yun Sun, co-director of the China Program at the Stimson Center, noted that Russia "is far less an economic player in Africa" than China, "including in the renewable energy sector."

"It's not just in Africa. Globally, China's earlier investment in the EV battery industry has given its dominant position and advantage in the market," Sun told Newsweek. "Other countries can play catchup, but it's hard to compete with China when they dominate the supply chain from mining of the materials to the production."

She continued, "Both U.S. and Europe have come to the realization that they are lagging behind. But investment in military and political domains is not going to translate into direct competitiveness in the mining industry, especially in less stable countries or countries with poor governance record."

In a statement, a State Department spokesperson highlighted multiple projects and studies the U.S. has conducted in Africa in relation to minerals used for renewable energy. The statement also highlighted the State Department's efforts to thwart terrorist activity on the continent.

"Terrorist groups present an acute and immediate threat to governments and to civilian safety and security in many natural resource rich regions of sub-Saharan Africa," the spokesperson told Newsweek in part. "These terrorist groups carry out attacks on military outposts; kidnap and attack private citizens and humanitarian workers, including Americans; attack churches, mosques, and schools; assassinate civil servants and politicians; and destroy property. Their activities devastate local communities and severely disrupt local economies."

The statement added, "Investing in counterterrorism can help the critical minerals mining sector in Africa primarily by supporting and protecting communities, but also by creating a more stable investment climate."

A Long Road Ahead

Many experts agree that to meet the aggressive green energy plans outlined in the IRA, the U.S. needs to focus energy on its own soil.

Lee argued the Biden administration should take a much more proactive position in America with domestic processing plants. Ewing suggested that the U.S. pursue "next generation technologies" such as solid-state batteries that could "alter what materials are, in fact, the most important and sought after."

"A lot of materials dominate the current state of things like battery sectors and other parts of renewable energy and the clean, noncarbon supply chain, but that doesn't mean they always will," Ewing said. "One part of U.S. strategy for getting around how behind we are in some of these supply chains from China is to pursue those next generation technologies."

One thing is clear. The U.S. wants to escape its geopolitical reliance on China.

"If we want to buy an electric vehicle today, that vehicle produced today relies on a lot of Chinese materials," Gross said. "It will take a while for us to develop different sources of supply."