Climate ministry proposes recycling focus in update of German resource strategy

In order to make the economy fit for the requirements of a decarbonised energy system, Germany’s economy and climate ministry (BMWK) has proposed an update to the country’s resource supply strategy. By focusing on resource efficiency and recycling, the new strategy should lay the groundwork for a “massive growth” in fossil-free technologies, state secretary Franziska Brantner commented on Twitter. “We need the most innovative solutions,” Brantner said, explaining that this would be supported through financial incentives, implementation of clear standards for resource circulation, the removal of regulatory hurdles and the speeding up of administrative procedures. Estimates by the International Energy Agency and by Germany’s resource agency (DERA) predict that demand for critical raw materials for the energy transition, such as rare earths minerals or lithium, could rise up to 40-fold until 2040. “All analyses show that an insufficient supply of these resources poses a significant challenge to reaching global climate targets,” the BMWK stated.

By establishing quotas for recycled materials and “establishing lead markets” for second-hand trading of certain key resources, new supply chains should be unlocked and existing ones better analysed, the ministry stated. Moreover, domestic and European resources should receive greater attention for exploring new deposits and reducing import dependencies across the EU. The ministry also proposed support for companies in stockpiling critical raw materials, and a fund to help increase production capacities nationally and internationally. Through entering direct bilateral resource partnerships with countries outside Europe and a thorough application of ESG (environmental, social, governance) standards in investment projects, the ministry said it wants to support the EU Raw Material Act and ensure that resource extraction happens in line with international development and sustainability targets.

Mineral resources are increasingly gaining importance for Germany’s industry and energy supply, as the economy moves towards electric cars, renewable energy installations and other non-fossil technologies. Already before the energy crisis hit in 2022, supply of certain key materials had come under strain, with government agencies lamenting a massive overreliance on individual import partner countries like China. Industry groups hope a bustling recycling market could come to life, thanks to the immense value better recycling has to offer.