The New Resource Race: Critical Minerals & Circularity
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As the world accelerates its energy transition, the race for critical minerals has expanded. Lithium, cobalt, nickel, and rare earth materials are vital to everything from electric vehicle (EV) batteries to wind turbines. But with geopolitical constraints, environmental costs, and growing demand, The Exchange and our partners are asking, “How can we ensure access to these finite materials in a responsible and resilient way?”
The answer may be circularity — rethinking how we source, use, reuse, and recycle critical minerals across value chains.
Project Closed Circuit tackled this issue at a recent panel discussion on “The New Resource Race: The Role of Circularity in the Stewardship of Critical Minerals,” co-hosted by The New York Climate Exchange and The Earth Commons at Georgetown’s Institute for Environment & Sustainability.
Circularity by Design: Urban Mining & Local Procurement
“Why keep investing in more extraction, when the solutions already exist in the communities we overlook?” asks John Holm, Senior Vice President of PYXERA Global and lead architect of the Circular Supply Chain Coalition (CSCC). Urban mining involves reclaiming critical materials from discarded electronics, batteries, and industrial byproducts already circulating in a city. This opportunity embeds local procurement of reclaimed minerals into corporate and public sector operations to reduce reliance on volatile global markets.
“We’re not just talking ESG anymore,” says Holm. “This is now a supply chain security issue. Companies need access to reliable, domestic feedstock to survive in an unstable world.”
The current moment is unique. Between global conflicts, trade restrictions, and shifting climate policies, the general case for onshoring and remanufacturing has become an economic imperative. Governments are investing, companies are listening, and new partnerships are forming.
What the U.S. Can Learn from Circularity in Other Countries
Milo McBride, Fellow at the Sustainability, Climate, and Geopolitics Fellow at Carnegie Endowment for International Peace, brings a global perspective to the conversation, pointing out several best practices for global circularity of critical minerals:
The EU Circular Economy Action Plan and its landmark Battery Passport policy, which enables material traceability across the battery lifecycle.
Japan and South Korea’s industrial policies, which fund circular technology R&D and set benchmarks for mineral reuse.
China’s long-term investment in virgin and secondary mineral processing capacity and regional supply chain dominance.
According to McBride, the U.S. remains overly dependent on “carrots” (incentives) while lacking sufficient “sticks” (disincentives) such as mandates or binding regulations. To unlock the full potential of recycling markets, we need enforceable targets, robust procurement standards, and stronger traceability systems.
That’s where The Exchange’s Project Closed Circuit (PCC) comes in. By tapping into its cross-sector network of academic, industry, government, and community partners, PCC is working to establish battery procurement standards tailored for municipalities and fleet operators. These standards aim to extend the useful life of batteries through improved data transparency, support their reuse in secondary applications, and ensure the eventual recovery and recycling of embedded critical minerals.
In terms of materials impact, McBride is candid: “Recycling won’t substantially reduce primary mining until the 2040s.” Technologies like solar and steel already operate with circular supply chains, but battery recycling remains nascent. Further complicating the picture is that most facilities in the U.S. are optimized for nickel-cobalt chemistries, while lithium-iron-phosphate (LFP) batteries — dominated by Chinese manufacturers — are more challenging to process and currently lack scalable recycling pathways.
Full circle: Repurposing Waste as a Resource
Josh Mackey is a Geochemist at the National Energy Technology Laboratory. His research suggests that the key to unlocking circularity is underground, but not in the way you might think.
Mackey is exploring how legacy fossil energy byproducts, such as the salty “produced water” from oil and gas drilling, could become new sources of lithium and other critical minerals. In regions like Texas and Pennsylvania, billions of liters of this waste fluid are generated daily. Historically viewed as an environmental hazard, it now holds untapped economic value.
According to Mackey, barriers to scale include:
Extraction methods for producing water and mine tailings are at an early stage and need to be validated at a commercial scale.
Ownership of waste streams is unclear. Is it a waste? A mineral? Who holds the rights?
Existing regulations and market mechanisms don’t treat these streams as assets, so the United States lacks the infrastructure for their recovery.
The nascent produced water reclamation industry needs investment in pilot facilities, regulatory clarity, and coordination between extraction and processing firms.
Circularity Lessons from the Global South
Circularity already exists in many forms, just not always safely or formally, explains Amrita Kundu, Assistant Professor of Operations and Analytics at Georgetown McDonough School of Business. In Bangladesh, the rise of informal lead-acid battery recycling networks shows what can happen when economic incentives drive material recovery in the absence of regulation. “We see circularity,” Kundu says, “but it’s often toxic, inefficient, and exploitative.”
From her fieldwork, she has drawn several lessons for U.S. policymakers and businesses:
Circularity must be profitable to be scalable. That means ensuring markets for reliable raw materials and secondary supply.
Business models matter. Leasing, swapping, and manufacturer take-back programs create incentives to design longer-lasting, reusable batteries.
Traceability tools (like digital battery passports) enable accountability and make recycling more efficient.
“Circularity is not just a technological challenge,” she says. “It’s a question of logistics, economics, and trust.”
Approaching Circularity with Capital, Clarity, and Collaboration
In talking to these experts, The Exchange gathered several calls to action:
Frame circularity as a national security issue, not just an environmental one; this appeals across party lines.
Invest in supply chain mapping and transparency tools to close the loop and hold actors accountable.
Pilot new business models and technologies, especially in hard-to-recycle chemistries like LFP batteries or in emerging streams like permanent magnets.
Create co-investment structures between government, venture capital, and industry to scale proven concepts.
Adopt EV and battery procurement standards that enforce the circularity of batteries through extending first-life use, enabling battery re-use in secondary applications, and ensuring eventual recycling.
Kerrie Carfagno, Program Director of Georgetown’s Master’s in Science in Environment and Sustainability Management, reminded us that “we’re not at square one, but we are at a turning point. The opportunity is here to build a resource economy that is regenerative, equitable, and future-ready.”
Want to keep up with the latest on circular supply chains? Follow Project Closed Circuit, which aims to cultivate a robust circular economy that advances a secondary market for EV batteries in urban environments.