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The energy transition requires a dramatic increase in the supply of critical materials, yet their supplies chains remain vulnerable to a range of geopolitical risks, according to a new report by International Renewable Energy Agency (IRENA).
 
The report, Geopolitics of the Energy Transition: Critical Materials, notes that while there is no scarcity of reserves for energy transition minerals, global capabilities for mining and refining them are limited. Supply disruptions could impact the speed of the energy transition in the short to medium term, the report warns.
 
The report examines the geopolitical risks and opportunities linked to a growing demand for materials in the coming years and calls for a holistic approach to diversify supply chains.
 
While the dependency and supply dynamics fundamentally differ from fossil fuels, mining and processing of critical materials is geographically concentrated, with a few countries and few major companies playing a dominant role. External shocks, resource nationalism, export restrictions, mineral cartels, instability, and market manipulation could therefore increase the risks of supply shortages.
 
The report also highlights the opportunity to rewrite the script for extractive commodities and build the momentum for more inclusive, ethical, and sustainable value chains.