Summary
The global energy transition depends on a substantial and sustained increase in the supply of critical minerals, such as copper, lithium, nickel, and cobalt, used in electrification, renewable energy systems, batteries and digital infrastructure.
Mining projects are typically capital-intensive, long-term investments and are often located in jurisdictions with elevated political or commercial risk. To overcome current investment barriers – including geographical concentration of supply, long project lead times, and price volatility – policymakers should empower export credit agencies (ECAs) to proactively support projects and collaborations that diversify and strengthen responsible supply across the entire value chain, from extraction to processing, refining and recycling.
Countries like Sweden, with advanced mining technology and strong sustainability frameworks, are uniquely positioned to contribute to responsible mining development globally. ECAs are uniquely positioned to provide guarantees and long-term financing in markets and projects that private financiers often judge as too risky.
Growing demand for critical minerals
According to the International Energy Agency (IEA), demand for several critical minerals could increase multiple times by 2030–2040 under net-zero emissions scenarios. The World Bank has similarly estimated that billions of tonnes of minerals may be required to deploy renewable energy, storage and grid infrastructure consistent with global climate objectives.
Key materials include copper, lithium, nickel and cobalt, which are essential for batteries, electric vehicles, renewable power generation and grid expansion.
At the same time:
- Supply chains for several minerals are geographically concentrated
- New production capacity often involves long development timelines
- Price volatility can influence investment conditions
Several international organisations, including the IEA and UNEP, have noted that supply constraints, if not addressed, could increase costs and slow the pace of the transition in certain scenarios.
Structural characteristics of mining investment
Mining differs from many other industrial sectors due to:
- Long lead times: Developing a new mine can take 10–20 years from discovery to production.
- High upfront capital expenditure with extended payback periods
- Regulatory and permitting complexity particularly in environmentally sensitive areas.
- Geopolitical and commercial risks as many deposits are located in emerging or frontier markets.
Industry analyses suggest that meeting projected demand for batteries and electrification technologies could require substantial new mining capacity over the coming decades. The precise scale of required expansion varies depending on technological development, recycling rates, substitution, and demand growth.
The role of long-term finance and risk-sharing
Mobilising private capital at scale requires risk-mitigation mechanisms that support commercially viable and environmentally responsible projects. Export credit agencies (ECAs), including the Swedish Export Credit Agency (EKN), play a market-complementary role.
- A newly developed copper mine in a high-risk country can invest in modern mining operations and gain access to advanced Swedish technology and equipment when the lender’s risk exposure is covered by a guarantee from EKN, backed by the Swedish State.
- Environmental and social due diligence, aligned with international standards, is applied when an ECA such as EKN is involved. For example, a mine in the Democratic Republic of the Congo is incentivised to assume responsibility for environmental protection and human rights beyond the requirements of local legislation, when this level of responsibility is a prerequisite for access to international bank financing supported by an ECA.
- Companies across the metals industry value chain can secure access to raw materials when ECA-backed financing is used to develop, expand or modernise mines, with off-take agreements provided in return.
Technology and sustainability
Technological innovation is reshaping the mining sector through:
- Electrification of equipment
- Automation and remote operation
- Digital optimisation and data-driven resource management
Swedish mining technology companies are internationally active in these areas and contribute to improvements in safety, energy efficiency and emissions performance.
In some cases, new mining projects combining high-grade deposits with modern technology have reported comparatively low carbon intensity per tonne of output, although environmental performance varies depending on geology, energy mix and operational practices.
Recycling and circularity in the critical minerals value chain
A balanced policy discussion on critical minerals should consider not only the need for new primary production, but also the expanding role of recycling, material efficiency and substitution.
The growing role of secondary materials
Recycling already contributes significantly to global supply for certain metals, including copper, nickel and cobalt. Over time, secondary materials are expected to play an increasingly important role as:
- Larger volumes of batteries and renewable energy components reach end-of-life
- Collection and recycling systems improve
- Technologies for material recovery become more efficient
- Regulatory frameworks strengthen recycling targets and traceability
Within the European Union, initiatives such as the Critical Raw Materials Act and the Batteries Regulation aim to increase recycling rates, promote resource efficiency and reduce strategic dependencies.
Structural limitations in the short to medium term
At the same time, analyses by organisations such as the IEA indicate that recycling alone is unlikely to meet projected demand growth in the near to medium term.
This is partly because:
- Many clean energy technologies are still in early deployment phases
- The stock of installed products available for recycling remains limited
- Demand growth in several net-zero scenarios outpaces the availability of secondary materials
As a result, most climate-aligned scenarios foresee a continued need for responsibly managed primary production alongside expanded recycling.
Workforce, ESG and social acceptance
Strong environmental, social and governance (ESG) performance is increasingly integrated into investment decisions by banks, institutional investors and multilateral institutions.
Key trends include:
- Growing demand for digital and technical skills in mining operations
- Increased focus on workplace safety and community engagement
- Greater transparency in environmental performance and reporting
Maintaining a social licence to operate requires meaningful stakeholder dialogue, respect for local communities and adherence to internationally recognised standards.
Strategic implications for Europe
Securing access to critical raw materials has become a strategic priority within the European Union.
The Critical Raw Materials Act aims to:
- Strengthen supply chain resilience
- Diversify sourcing
- Increase domestic extraction, processing and recycling capacity
- Improve the efficiency and predictability of permitting procedures
The Nordic region has a well-established mining and technology ecosystem that can contribute to innovation, sustainability and supply security.
Policy considerations
To support responsible mineral supply in line with climate objectives, policymakers may consider:
- Scaling up risk-sharing financial instruments
Mobilising private capital through ECAs and multilateral institutions.
- Enhancing regulatory predictability
Streamlining processes while maintaining high environmental and social safeguards.
- Promoting innovation and skills development
Supporting digitalisation, electrification and workforce reskilling.
- Strengthening international cooperation
Encouraging transparent, diversified and rules-based supply chains.
- Upholding robust ESG standards
Aligning mineral development with international environmental and social frameworks.
Policy implications
From a policy and financing perspective, a robust approach involves supporting both responsible mining and circular solutions.
This may include:
- Encouraging design for recyclability and longer product lifespans
- Supporting innovation in recycling technologies
- Promoting efficient material use and substitution where feasible
- Integrating life-cycle considerations into project assessment and risk analysis
For export credit agencies, this balanced perspective can inform support for projects that enhance resource efficiency, enable recycling infrastructure, or improve environmental performance across the value chain.
Conclusion
Most energy transition scenarios consistent with global climate goals indicate a substantial increase in demand for critical minerals. Meeting this demand responsibly will require a combination of technological innovation, sound governance, diversified supply chains and well-structured financing solutions.
Export credit agencies can contribute by enabling sustainable projects, supporting responsible companies and promoting high environmental and social standards across global value chains.
