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Justice in the “critical minerals value chain” – moving in tandem for a just transition

Introduction

Humanity is at a crossroads, confronted with the effects of climate change that no nation can solve on its own without working with others. It requires all countries to act jointly to reduce greenhouse gas emissions and the temperature rise to below 1.5°, and attain the global objectives of the Paris Agreement. To achieve this, critical minerals are of the utmost importance for generating, distributing and storing renewable energy.[1] At COP28 in 2023, all countries committed to tripling renewable energy capacity and doubling energy efficiency by 2030.[2] A transition of this scale presents considerable opportunities, but also major challenges. Looking at the opportunities, developing countries, particularly those with abundant resources in Africa, have the potential to drive development through value-addition, benefit-sharing, economic diversification and integration into the value chains of critical minerals, rather than serving merely as suppliers of raw materials.[3] Equally, in the race to extract these minerals, mining activities overlook the norms and rules that have ensured the cohesion of African societies, resulting in environmental deterioration, human rights violations, dispossession of indigenous peoples’ land without appropriate and timely compensation, and unequal distribution of revenues, to mention but a few.[4]

In response to calls from developing countries, including resource-rich African countries, at COP 28, the UN Secretary-General has decided to establish a Panel on Critical Energy Transition Minerals in April 2024.[5] This group was formed to ensure that the renewable energy revolution does not reproduce and amplify the injustices and inequalities of the past and continue to relegate resource-rich countries to the bottom of supply chains.[6] In this regard, the Panel was, therefore, tasked with drafting a set of “global and common voluntary principles on issues critical to building trust between governments, communities and industry, enhancing transparency and investment, and ensuring fair and equitable management of sustainable, responsible and reliable value chains for land-based minerals critical to the energy transition”.[7] On September 11, 2024, the UN Panel of experts published a report setting out principles and actionable recommendations on how to steer the extraction of minerals essential to the energy transition, by securing equity and justice whilst producing clean energy and tackling climate change.[8]

What does the report entail?

The report encompasses seven voluntary principles and actionable recommendations that build on existing legal standards, commitments and obligations enshrined in international instruments, namely the UN Charter, UDHR, ICESCR, ICCPR, CEDAW, UNFCCC, the Paris Agreement, CRC, UNCAC, UNDRIP, DRTD, UNGPs, the Rio Declaration on Environment and Development, GBF, just to name a few.[9] The guiding principles require, firstly, that human rights be guaranteed at the heart of all mineral value chains. Secondly, preserving the planet’s integrity, environment and biodiversity is crucial. Thirdly, justice and equity must underpin mineral value chains. Fourthly, the report states that development must be fostered through benefit sharing, value creation and economic diversification. Fifth, it calls for responsible and equitable investment, financing and trade. Sixthly, it stresses that transparency, accountability and the fight against corruption are necessary to ensure good governance. And lastly, it underlines that multilateral and international cooperation must underpin global action and promote peace and security.[10] In addition, the panel provides a number of concrete actionable recommendations to strengthen the UN’s ability to build key bodies and processes to integrate and support these principles.[11]

The principles constitute a set of indivisible, interdependent and interrelated rights that must govern the way countries carry out mineral extraction in the framework of energy revolutions, while countering climate change impacts without compromising the development of mineral-dependent countries. Above all, equity and justice must be preserved in the value chains of critical minerals.

Justice, an imperative in developing critical minerals

The essence of this report is to advocate for equity and justice in mineral value chains. Indeed, in the context of extracting and developing minerals crucial to the energy transition, injustices and inequalities endured by source-rich African countries manifest in different ways. For example, the Democratic Republic of the Congo accounts for 70% of the world’s cobalt reserves, an essential component in the batteries used in electric cars, as it reduces emissions of atmospheric pollutants and greenhouse gases. However, the cobalt mining center of Kolwezi, in the DRC’s western Katanga province, is facing a growing a phenomenon of child labor in artisanal and small-scale mining, due to poverty, income inequality and market imperfections.[12] 

Furthermore, lithium, the key material in Li-ion batteries, is essential for energy storage in electronic devices such as electric vehicles, and plays a central role in the energy transition. African countries, including Zimbabwe, Namibia, the DRC, Mali and Ghana, are endowed with lithium deposits amounting to 4.38 million tons, with the DRC alone possessing over 60%. Nevertheless, mining lithium in those countries poses significant impacts on the social and ecological environment, including the depletion of rich biodiversity, the displacement of indigenous communities and the emergence of new patterns of illegality in the resource sector for the benefit of Western countries.[13] 

Another dimension of injustice lies in the way in which source-rich countries are confronted with the serious consequences of climate change, even though they emit less gas. Indeed, per capita carbon dioxide emissions in Africa are less than a ton a year, and account for just 2.4% of global emissions. [14] Yet the burden of climate change in Africa is heavier than anywhere else in the world. This is because mining projects are intrinsically dependent on the natural environment, which is often located in difficult, climate-sensitive areas, and relies on natural resources such as water and energy.

The need for justice lies both in the development of critical minerals and in the equitable transition to a low-carbon economy. Indeed, justice requires a change in positioning resource-rich countries in the critical minerals value chain, as producers rather than suppliers of raw materials.[15] In this regard, resource-rich African countries could be enabled to reach their development targets. In fact, resource-rich and less-resourced countries have shared responsibilities for achieving the goals of the Paris Agreement, but are endowed with different capacities and resources to implement change.[16] Therefore, justice and equity imply that all countries, especially those that are not yet part of supply chains for minerals essential to the energy transition or that do not generate renewable energy technologies, should benefit from affordable, modern and sustainable energy on an equal footing with their counterparts.

Cornerstones of justice in critical energy transition minerals

In the race of taking urgent principles and effective action to address climate change, some cornerstones of justice must be reflected in the value chains of minerals essential to the energy transition to benefit resource-rich African countries. Indeed, some of the pillars of justice need to be considered at this juncture. Firstly, justice comes in the form of distributive justice. Distributive justice implies a fair distribution of resources and profits from the development of critical minerals between societies.[17] As the critical minerals industry evolves, a central issue that needs to be addressed is taxation.[18] It is imperative that source-rich countries understand how to tax critical minerals, where their revenues flow and how they are distributed to benefit the neediest in critical minerals value chains. As developing countries adapt their tax regimes, considerations should be based on legal certainty, so that distributive justice is not just an illusory prospect as the policies surrounding critical minerals for the energy transition develop.

Another form of justice to consider is procedural justice. Procedural justice engages with the legal process throughout the mineral energy transition project.[19] From initial extraction to final usage, there is a legitimate opportunity to assess climate aspects. The key issue for the critical development of the minerals industry is climate impact assessment before the mining project takes place,[20] along with social and environmental assessments.  It is important to stress that developing countries define this requirement at national level. Legislation is needed to ensure that climate impact assessment becomes an essential element of critical minerals projects, as it can reduce the overall risk profile of the project for all stakeholders involved.

In addition, restorative justice is also a matter of concern. It emphasizes that injustices created during the development of energy transition minerals must be corrected in due process.[21]  This form of justice provides a basis for determining where prevention should be implemented. As part of the development of the critical minerals industry towards a just transition, a “restorative cost” for climate change impacts must be codified and integrated into critical mining project costs at the national level.[22]  In addition, it is essential that extraction sites are not abandoned after critical minerals have been extracted, but are returned to their former landowners after being restored in compliance with legal standards.

Conclusion

Achieving climate-resilient development in the context of critical energy transition minerals value chains necessitates environmental, social and economic considerations to address social imbalances, wealth distribution inequalities and environmental injustices. The pressing need for energy transition should not be used to legitimize irresponsible practices and amplify injustices. On the contrary, access to equitable treatment, legal remedies and the opportunity to participate in decision-making processes and individual economic growth must be guaranteed.


[1] Dolf Gielen, ‘Critical minerals for the energy transition’, International Renewable Energy Agency, Abu Dhabi (2021).

[2] United Nations Framework Convention on Climate Change, Conference of the Parties, ‘First global stocktake’ (2023) Fifth session, United Arab Emirates.

[3] Susan Nakanwagi, ‘Critical Minerals and the Global Energy Transition: Recognising Global South Perspectives’, (2023) 1(2) Global Energy Law and Sustainability 4, 115-137.

[4] James Boafo, Jacob Obodai, Eric Stemn, and Philip Nti Nkrumah, ‘The race for critical minerals in Africa: A blessing or another resource curse?’ (2024) Resources Policy 93, 105046.

[5] United Nations Secretary-General’s Panel on Critical Energy Transition Minerals, ‘Terms of Reference’ <https://www.un.org/sites/un2.un.org/files/terms_of_reference_sgs_panel_on_critical_energy_transition_minerals.pdf > accessed 23 September 2024.

[6] Ibid.

[7] United Nations Secretary-General’s Panel on Critical Energy Transition Minerals Report, ‘Resourcing the energy transition: Principles to guide critical energy transition minerals towards equity and justice’ (2024) <https://www.un.org/sites/un2.un.org/files/report_sg_panel_on_critical_energy_transition_minerals_11_sept_2024.pdf > accessed 23 September 2024.

[8] United Nations Secretary-General’s Panel on Critical Energy Transition Minerals Report, ‘Resourcing the energy transition: Principles to guide critical energy transition minerals towards equity and justice’ (2024) <https://www.un.org/sites/un2.un.org/files/report_sg_panel_on_critical_energy_transition_minerals_11_sept_2024.pdf > accessed 23 September 2024.

[9] Ibid.

[10] Ibid.

[11] Ibid.

[12] Godelive Kusimwa Batano, Martin Doevenspeck and Nene Morisho Mwana Biningo, ‘Small-scale mining and child labour in Kolwezi, Democratic Republic of Congo’ (2023) (4) Journal of African Studies and Development 15, 69-83.

[13] James Boafo, Jacob Obodai, Eric Stemn, and Philip Nti Nkrumah, ‘The race for critical minerals in Africa: A blessing or another resource curse?’ (2024) Resources Policy 93, 105046.

[14] Kifle Temesgen, ‘Africa hit hardest by Global Warming despite its low Greenhouse Gas Emissions’ (2008).

[15] United Nations Secretary-General’s Panel on Critical Energy Transition Minerals Report (2024).

[16]  Ibid.

[17] Raphael J Heffron, ‘The role of justice in developing critical minerals’ (202) (3) The extractive industries and society 7, 858

[18] Ibid.

[19] Ibid., 859.

[20] Thoko Kaime and Ange Dorine Irakoze, ‘Proposing A Framework for Governing Critical Minerals Extraction in Africa Towards Energy Transition’ (2023 (4) European and International Journal of Tax Law 2, 503-504.

[21] Raphael J Heffron, ‘The role of justice in developing critical minerals’ (202) (3) The extractive industries and society 7, 859

[22] Ibid.

By Ange-Dorine Irakoze

Ange-Dorine Irakoze is a PhD Candidate at the Chair of African Legal Studies Bayreuth.

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