U.S. committee recommends royalties on mining minerals for EVs

A federal committee, Tuesday, put forth a suggestion to introduce royalties on U.S. hardrock mining with an aim to potentially boost domestic mining production by generating additional funds for the agencies responsible for granting new mining permits.

This proposal is just one element of a comprehensive set of recommendations designed to enhance the supply of essential materials like lithium, cobalt, and nickel. Materials crucial for supporting the growth of a domestic electric vehicle (EV) industry, which plays a pivotal role in advancing President Joe Biden’s climate agenda.

The 168-page report submitted by the Interagency Working Group on Mining Laws, Regulations, and Permitting issued a broad call for Congress to reform the General Mining Law of 1872, a law originally established as a framework to allow for free and open exploration of federal mineral deposits.

In addition to recommending the implementation of royalties ranging from 4% to 8%, the interagency group advocated for transitioning to a leasing system for mining on federal lands. Furthermore, they proposed encouraging mining claimants to expedite the development of their claims by gradually increasing fees over time.

These proposed changes aim to level the playing field for the mining industry, aligning it more closely with industries like oil, gas, and coal.

The committee is headed by the Interior Department and comprises representatives from various governmental entities, including the Environmental Protection Agency, the Departments of Agriculture, Energy, and State, as well as the White House and the Advisory Council on Historic Preservation.

One department official claims that “Agreeing to play by the same rules that other people are playing by can help with the public perception of the mining industry.”

“Also, if a community or a state is going to receive some of the revenue from this, then that can also either lower opposition or provide funding to address some of the issues that are causing the opposition,” the official added.