Securing Energy Supply Chains: One Critical Mineral Deal at a Time?

This policy brief examines the United States government's recent shift toward using equity investments to secure critical mineral supply chains, particularly to reduce dependence on China. While these deals provide essential up-front capital and have catalyzed private investment, the author argues that equity alone is insufficient and must be paired with demand-side supports, such as price floors and offtake agreements, to ensure long-term market stability.

• The US government has shifted its industrial policy for critical minerals by increasing the use of equity stakes in private companies and projects, moving beyond traditional grants, loans, and tax incentives. In 2025, seven such projects were announced, often involving multiple federal agencies and the restructuring of previous grants and loans into equity deals.
• The primary driver for these investments is the high level of market concentration in China, which dominates the mining and refining of critical minerals. Specifically, China controls approximately 98% of gallium, 77% of natural graphite, and 70% of rare earth elements. This concentration has led to supply disruptions, including China's 2023 export controls on gallium and germanium and its 2025 export controls on seven heavy rare earth elements.
• The MP Materials deal is highlighted as a uniquely effective model because it combines equity investment with a guaranteed price floor and offtake commitments. For 10 years, the US government will purchase neodymium-praseodymium at $110 per kilogram (or price match) and has committed to purchasing 100% of the magnets from a proposed facility, providing a demand safeguard that other recent deals lack.
• The author contends that equity investments are not a 'silver bullet' and must be paired with demand-side policies to create a sustainable industry. Without mechanisms to guarantee buyers or stabilize prices, well-capitalized projects may still fail. The brief proposes a Congressionally authorized program to codify these investments, protect taxpayer funds, and develop professional exit strategies.

APA

RMI (2026). Securing Energy Supply Chains: One Critical Mineral Deal at a Time? https://rmi.org/resources/securing-energy-supply-chains-one-critical-mineral-deal-at-a-time/

Chicago

RMI. Securing Energy Supply Chains: One Critical Mineral Deal at a Time? 2026. https://rmi.org/resources/securing-energy-supply-chains-one-critical-mineral-deal-at-a-time/.

Wikipedia

{{cite report |author=RMI |title=Securing Energy Supply Chains: One Critical Mineral Deal at a Time? |date=27 April 2026 |url=https://rmi.org/resources/securing-energy-supply-chains-one-critical-mineral-deal-at-a-time/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2026securing, author = {{RMI}}, title = {{Securing Energy Supply Chains: One Critical Mineral Deal at a Time?}}, institution = {RMI}, year = {2026}, month = apr, url = {https://rmi.org/resources/securing-energy-supply-chains-one-critical-mineral-deal-at-a-time/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }