The Critical Minerals Policy Act

The Senate Energy & Natural Resources Committee held a hearing on January 28th about Senator Lisa Murkowski’s bill, the Critical Minerals Policy Act. Here’s a brief summary:

The bill — S. 1600 — is one of the few bipartisan efforts out there. They have 10 Democratic and 8 Republican cosponsors. This hearing was very bipartisan. The Committee Chairman, Sen. Ron Wyden, is a cosponsor. Sen. Lisa Murkowski is the author of the legislation. She is the leading Republican on the committee.

The witnesses were divided into two panels: (1) a government panel and (2) a private sector panel.

The government panel included:

  • David Danielson (Dept. of Energy)
  • Larry Meinert (Dept. of Interior)

The private sector panel included:

  • Jim Sims (Molycorp)
  • Robert Latiff (George Mason University)
  • David Isaacs (Semiconductor Industry Association)
  • Greg Conrad (Interstate Mining Compact Commission)
  • Jennifer Thomas (Alliance of Automobile Manufacturers)
  • Roderick Eggert (Colorado School of Mines).

The government witnesses were non-committal. They can’t really endorse legislation without approval from the Office of Management and Budget (OMB). The Energy witness said there is “value” in the bill. The Interior witness said he was “thrilled and delighted” that the bill was introduced. Sen. Murkowski was disappointed that the Administration wouldn’t endorse the bill. The Department of Energy said they are reviewing it.

All of the private sector witnesses endorsed the legislation.

Jim Sims (Molycorp) was probably the most eloquent of the witnesses and had a more comprehensive understanding of all of the issues. He talked about their facility in California. Described the 15 years it took to bring Mountain Pass back online.

Sen. Wyden, more than once, said the Committee should learn lessons from Molycorp, how to streamline regulation, etc., because 15 years is too long. When asked how he is able to forecast supply and demand, Sims gave the only good answer on the panel. He said supply is forecast by their geologists and demand is forecast by their ability to raise private capital. Others were looking for some government crystal ball to forecast supply and demand. By the way, Sims said they are currently processing 15 rare earths and 5 other critical metals at their facility.

Robert Latiff is a retired general. Talked a lot about stockpiling rare earths for national defense needs. David Isaacs (Semiconductor Industry Association) also talked about stockpiling. Compared it to U.S. helium policy.

Greg Conrad (Interstate Mining Compact) talked about mining permits and ways to streamline the necessary permits.

Jennifer Thomas (Automobile Manufacturers) said they need a steady supply of rare earths and other critical metals to build the batteries, lighter weight frames and catalytic converters that are needed to meet the new MPG standards set by the government. In other words, a demand artificially created by government policy. Her main worry is supply disruption.

Roderick Eggert is an economist at the Colorado School of Mines. Talked like a free market economist. Said the government should only get involved to facilitate international trade, improve regulatory review, facilitate the collection of data, and fund research and education (both public goods, he said).

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