[House Report 118-22]
[From the U.S. Government Publishing Office]


118th Congress }                                          { Report 
                        HOUSE OF REPRESENTATIVES
 1st Session   }                                          { 118-22

======================================================================
 
            SECURING AMERICA'S CRITICAL MINERALS SUPPLY ACT

                                _______
                                

 March 23, 2023.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

Mrs. Rodgers of Washington, from the Committee on Energy and Commerce, 
                        submitted the following

                              R E P O R T

                             together with

                             MINORITY VIEWS

                        [To accompany H.R. 1068]

    The Committee on Energy and Commerce, to whom was referred 
the bill (H.R. 1068) to amend the Department of Energy 
Organization Act to secure the supply of critical energy 
resources, including critical minerals and other materials, and 
for other purposes, having considered the same, reports 
favorably thereon with an amendment and recommends that the 
bill as amended do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     2
Background and Need for Legislation..............................     3
Committee Action.................................................     5
Committee Votes..................................................     5
Oversight Findings and Recommendations...........................     7
New Budget Authority, Entitlement Authority, and Tax Expenditures     7
Congressional Budget Office Estimate.............................     7
Federal Mandates Statement.......................................     7
Statement of General Performance Goals and Objectives............     7
Duplication of Federal Programs..................................     7
Related Committee and Subcommittee Hearings......................     7
Committee Cost Estimate..........................................     8
Earmark, Limited Tax Benefits, and Limited Tariff Benefits.......     8
Advisory Committee Statement.....................................     8
Applicability to Legislative Branch..............................     8
Section-by-Section Analysis of the Legislation...................     9
Changes in Existing Law Made by the Bill, as Reported............     9
Minority Views...................................................    10

    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Securing America's Critical Minerals 
Supply Act''.

SEC. 2. AMENDMENT TO THE DEPARTMENT OF ENERGY ORGANIZATION ACT.

  The Department of Energy Organization Act (42 U.S.C. 7101 et seq.) is 
amended--
          (1) in section 2, by adding at the end the following:
  ``(d) As used in sections 102(20) and 203(a)(12), the term `critical 
energy resource' means any energy resource--
          ``(1) that is essential to the energy sector and energy 
        systems of the United States; and
          ``(2) the supply chain of which is vulnerable to 
        disruption.'';
          (2) in section 102, by adding at the end the following:
          ``(20) To ensure there is an adequate and reliable supply of 
        critical energy resources that are essential to the energy 
        security of the United States.''; and
          (3) in section 203(a), by adding at the end the following:
          ``(12) Functions that relate to securing the supply of 
        critical energy resources, including identifying and mitigating 
        the effects of a disruption of such supply on--
                  ``(A) the development and use of energy technologies; 
                and
                  ``(B) the operation of energy systems.''.

SEC. 3. SECURING CRITICAL ENERGY RESOURCE SUPPLY CHAINS.

  (a) In General.--In carrying out the requirements of the Department 
of Energy Organization Act (42 U.S.C. 7101 et seq.), the Secretary of 
Energy, in consultation with the appropriate Federal agencies, 
representatives of the energy sector, States, and other stakeholders, 
shall--
          (1) conduct ongoing assessments of--
                  (A) energy resource criticality based on the 
                importance of critical energy resources to the 
                development of energy technologies and the supply of 
                energy;
                  (B) the critical energy resource supply chain of the 
                United States;
                  (C) the vulnerability of such supply chain; and
                  (D) how the energy security of the United States is 
                affected by the reliance of the United States on 
                importation of critical energy resources;
          (2) facilitate development of strategies to strengthen 
        critical energy resource supply chains in the United States, 
        including by--
                  (A) diversifying the sources of the supply of 
                critical energy resources; and
                  (B) increasing domestic production, separation, and 
                processing of critical energy resources;
          (3) develop substitutes and alternatives to critical energy 
        resources; and
          (4) improve technology that reuses and recycles critical 
        energy resources.
  (b) Critical Energy Resource Defined.--In this section, the term 
``critical energy resource'' has the meaning given such term in section 
2 of the Department of Energy Organization Act (42 U.S.C. 7101).

                          PURPOSE AND SUMMARY

    H.R. 1068, Securing America's Critical Minerals Supply Act, 
was introduced by Rep. Larry Bucshon (R-IN) and Rep. Randy K. 
Weber (R-TX) on February 27, 2023. H.R. 1068 amends the 
Department of Energy Organization Act by establishing that a 
purpose of the Department of Energy is to ensure there is an 
adequate and reliable supply of critical energy resources that 
are essential to the energy security of the United States and 
by including new functions of the Department relating to 
securing critical energy resource supplies.
    To carry out these functions, which include identifying and 
mitigating effects of a critical energy resource supply 
disruption on the development and use of energy technologies 
and the operation of energy systems, H.R. 1068 requires the 
Secretary to conduct ongoing assessments of the nation's supply 
of critical energy resources, the vulnerability of the critical 
energy resource supply chain, and the criticality of energy 
resources to the development of energy technologies. H.R. 1068 
requires further that the Secretary facilitate development of 
strategies to strengthen critical energy resource supply chains 
by diversifying sources and increasing domestic production, 
refining, and processing of resources and that the Secretary 
develop substitutes and alternatives and improve technology 
that reuses or recycles critical energy resources.

                  BACKGROUND AND NEED FOR LEGISLATION

    The United States maintains one of the most advanced and 
complex energy systems in the world. This includes an extensive 
system for producing and transporting oil, natural gas, and 
refined product; vast, complex electricity systems that produce 
and deliver uninterrupted power; and the supply chains of the 
energy resources and materials necessary for these energy 
systems and technologies to be built, maintained, operated. Our 
nation's economy, security, and the health and safety of its 
citizens depend upon the reliable and uninterrupted supply of 
fuels and electricity, as well the secure supplies of energy 
resources and materials necessary for this to happen.
    When the Department of Energy (DOE) was organized in 1977, 
energy security concerns revolved around oil supply shortages. 
As a result, energy security emergency functions in the 
Department of Energy Organization Act focused on distributing 
and allocating fuels in an emergency. Other functions focused 
on developing plans and programs for dealing with domestic 
energy production and import shortages and the provision of an 
adequate and reliable supply of energy at the lowest reasonable 
cost.
    Over time, these functions in DOE's organic statute have 
remained largely unchanged, but DOE's responsibilities and 
authorities have evolved substantially beyond what was 
envisioned forty years ago. As energy technologies and delivery 
systems have advanced, including with the growing use of 
advanced solar, wind, and battery technologies, focus on the 
supply chains of these technologies and the materials--the 
minerals and metals and other components--making up or enabling 
the operations of these technologies has become more important. 
The need for updating the functions of DOE is necessary to 
provide a durable, Cabinet-level focus on critical energy 
resource supplies and to serve the broader missions of the 
Department to coordinate national energy policy that will help 
assure the reliable supply of energy for the public.
    The urgency of supply chains for advanced and renewable 
energy systems is underscored by the materials intensive nature 
of these systems. For example, as outlined in Committee 
testimony during the 117th Congress, ``the materials extracted 
from the earth to fabricate everything, including wind 
turbines, solar panels, and batteries (to store grid 
electricity or power electric vehicles) are typically out of 
sight, located at remote quarries, mine sites, and mineral 
processing facilities around the world. Those locations matter 
in terms of geopolitics and supply-chain risks.''\1\
---------------------------------------------------------------------------
    \1\See testimony of Mark P. Mills before the Subcommittee on 
Environment and Climate Change hearing ``Back in Action: Restoring 
Federal Climate Leadership,'' February 9, 2021. Hearing Print Serial 
No. 117-4.
---------------------------------------------------------------------------
    Add to this the sheer scale of critical materials needed 
for these ``clean tech'' energy technologies, and the 
importance of security supplies becomes clear. Projections on 
the mineral requirements for ``green'' energy all show massive 
increases in minerals and related processing. The mining of 
indium, used in fabricating electricity generating solar 
semiconductors, for example, will need to increase 8,000%. 
Cobalt for batteries will need to grow 300% to 800%. Lithium 
production will need to increase 2,000%. Some 14 metals 
essential for building clean-tech machines will require 
increased supplies of elements such as nickel, dysprosium, and 
tellurium of 200% to 600%.\2\
---------------------------------------------------------------------------
    \2\Ibid.
---------------------------------------------------------------------------
    As recently as 1990, the United States was the world's 
number-one producer of minerals. By 2018, the United States had 
fallen to 12th overall in global non-fuel minerals 
production.\3\ A 2022 DOE assessment of critical energy 
resource supply chain risks notes that China's control of key 
materials in renewable energy is ``across the board,'' with 
China in control of ``80% of rare earths production and 
refining that are key for components in technologies such as 
direct drive generators in wind turbines, and China also 
controls 61% of global lithium refining key for battery storage 
and electric vehicles. China also controls 100% of the 
processing of natural graphite used for battery anodes.''\4\
---------------------------------------------------------------------------
    \3\See testimony of Michelle Michot Foss before the Subcommittee on 
Environment and Climate Change hearing ``Building a 100 Percent Clean 
Economy: Opportunities for and Equitable, Low-Carbon Recovery,'' 
September 16, 2020. (https://docs.house.gov/meetings/IF/IF18/20200916/
111008/HHRG-116-IF18-Wstate-MichotFossM-20200916-U1.pdf).
    \4\See Department of Energy ``America's Strategy to Secure the 
Supply Chain for a Robust Clean Energy Transition,'' February 2022, p. 
13).
---------------------------------------------------------------------------
    The severity of this overdependence on other countries for 
critical minerals was brought to the public's attention by the 
report released during the Trump administration, which found 
the United States relies on imports for 31 of the 35 critical 
minerals necessary for the U.S. defense and economy.\5\ For 14 
of the listed critical minerals, the United States relies 
completely on imports from other countries; having no U.S. 
production at all. (As indicated in the above DOE assessment, 
recent Biden administration reviews confirm U.S. 
vulnerability.)
---------------------------------------------------------------------------
    \5\See Testimony by the Honorable Mark W. Menezes at the Joint 
Energy, Climate, and Grid Security Subcommittee and Environment, 
Manufacturing, and Critical Materials Subcommittee Legislative Hearing, 
``Unleashing American Energy, Lowering Energy Costs, and Strengthening 
Supply Chains,'' February 7, 2023. (energycommerce.gov).
---------------------------------------------------------------------------
    Against this backdrop, while Congress has taken action to 
support research and development, incentives, and interagency 
planning, this is not enough, given the extent of current 
dependence on foreign supplies and increasing demand for 
minerals and materials heavy energy resources. As former DOE 
Deputy Secretary Mark Menezes has testified before the 
Committee: ``we need to designate an agency with clear 
authority to address these issues and to serve as the experts 
in the interagency process for energy.''\6\
---------------------------------------------------------------------------
    \6\Ibid.
---------------------------------------------------------------------------
    The Committee finds that H.R. 1068 would further enhance 
DOE's existing responsibilities over ensuring secure and 
affordable delivery of energy, by providing durable authority 
to assess the vulnerability of the critical energy resource 
supply chain, and the criticality of energy resources, 
particularly minerals and materials necessary in the 
development of energy technologies and including the supply 
chains for renewable energy technologies. The Committee finds 
the provisions of H.R. 1068 that facilitate the development of 
strategies to diversify sources of supply, by increasing 
domestic production, separation, and processing of critical 
energy resources, and by pursing the technological development 
of critical resource alternatives and of reuse and recycling is 
consistent with DOE's energy security mission, and unique 
capabilities in the United States government.

                            COMMITTEE ACTION

    On February 7, 2023, the Subcommittees on Energy, Climate, 
and Grid Security and Environment, Manufacturing, and Critical 
Materials held a joint legislative hearing entitled, 
``Unleashing American Energy, Lowering Energy Costs, and 
Strengthening Supply Chains,'' on 17 pieces of legislation, 
including H.R. 1068. The Subcommittees received testimony from:
           The Honorable Mark Menezes, Former United 
        States Deputy Secretary of Energy, Department of 
        Energy;
           The Honorable Bernard McNamee, Former 
        Commissioner, Federal Energy Regulatory Commission;
           Jeffrey Eshelman, II, President and Chief 
        Executive Officer, Independent Petroleum Association of 
        America;
           Katie Sweeney, Executive Vice President and 
        Chief Operating Officer, National Mining Association;
           Raul Garcia, Legislative Director for 
        Healthy Communities, Earthjustice; and
           Tyson Slocum, Director of the Energy 
        Program, Public Citizen.
    On February 28, 2023, the Subcommittee on Energy, Climate, 
and Grid Security met in open markup session and forwarded H.R. 
1068, without amendment, to the full Committee by a record vote 
of 15 yeas and 8 nays. On March 9, the full Committee on Energy 
and Commerce met in open markup session and ordered H.R. 1068 
favorably reported, as amended, to the House by a record vote 
of 26 yeas and 22 nays.

                            COMMITTEE VOTES

    Clause 3(b) of rule XIII requires the Committee to list the 
record votes on the motion to report legislation and amendments 
thereto. The following reflects the record votes taken during 
the Committee consideration:


                 OVERSIGHT FINDINGS AND RECOMMENDATIONS

    Pursuant to clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII, the Committee held a hearing and made findings that 
are reflected in this report.

   NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX EXPENDITURES

    Pursuant to clause 3(c)(2) of rule XIII, the Committee 
finds that H.R. 1068 would result in no new or increased budget 
authority, entitlement authority, or tax expenditures or 
revenues.

                  CONGRESSIONAL BUDGET OFFICE ESTIMATE

    Pursuant to clause 3(c)(3) of rule XIII, at the time this 
report was filed, the cost estimate prepared by the Director of 
the Congressional Budget Office pursuant to section 402 of the 
Congressional Budget Act of 1974 was not available.

                       FEDERAL MANDATES STATEMENT

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

         STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES

    Pursuant to clause 3(c)(4) of rule XIII, the general 
performance goal or objective of this legislation is to ensure 
there is an adequate and reliable supply of critical energy 
resources that are essential to the energy security of the 
United States.

                    DUPLICATION OF FEDERAL PROGRAMS

    Pursuant to clause 3(c)(5) of rule XIII, no provision of 
H.R. 1068 is known to be duplicative of another Federal 
program, including any program that was included in a report to 
Congress pursuant to section 21 of Public Law 111-139 or the 
most recent Catalog of Federal Domestic Assistance.

              RELATED COMMITTEE AND SUBCOMMITTEE HEARINGS

    Pursuant to clause 3(c)(6) of rule XIII,
    (1) the following hearings were used to develop or consider 
H.R. 1068:
    On January 31, 2023, the Committee on Energy and Commerce 
held a hearing entitled, ``American Energy Expansion: 
Strengthening Economic, Environmental, and National Security.'' 
The Committee received testimony from:
           The Honorable Paul Dabbar, Former Under 
        Secretary of Energy, Department of Energy;
           Robert McNalley, President, Rapidan Energy 
        Group, LLC;
           Donna Jackson, Director of Membership 
        Development--National Center for Public Policy 
        Research, Project 21; and
           Ana Unruh Cohen, Former Majority Staff 
        Director, U.S. House Select Committee on the Climate 
        Crisis.
    On February 16, 2023, the Subcommittee on Energy, Climate, 
and Grid Security held a field hearing in Midland, Texas, 
entitled, ``American Energy Expansion: Improving Local 
Economies and Communities' Way of Life.'' The Committee 
received testimony from:
           The Honorable Lori Blong, Mayor of Midland, 
        Texas, and President of Octane Energy;
           Adrian Carrasco, Chairman Midland Hispanic 
        Chamber of Commerce, and President of Premier Energy 
        Services;
           Steven Pruett, President and CEO, Elevation 
        Resources, and Chairman of the Board for Independent 
        Petroleum Association of America; and
           Dr. Michael Zavada, Professor of Biology and 
        Geosciences, and Chair, Department of Geosciences at 
        The University of Texas--Permian Basin.
    (2) The following related hearings were held:
    On February 7, 2023, the Subcommittees on Environment, 
Manufacturing, and Critical Materials and Energy, Climate, and 
Grid Security jointly held a hearing on 17 separate pieces of 
legislation, including H.R. 1068. The Subcommittee received 
testimony from:
           The Honorable Mark Menezes, Former U.S. 
        Deputy Secretary of Energy, Department of Energy;
           The Honorable Bernard McNamee, Former 
        Commissioner, Federal Energy Regulatory Commission;
           Jeffrey Eshelman, II, President and Chief 
        Executive Officer, Independent Petroleum Association of 
        America;
           Katie Sweeney, Executive Vice President and 
        Chief Operating Officer, National Mining Association
           Raul Garcia, Legislative Director Healthy 
        Communities, Earthjustice; and
           Tyson Slocum, Director of the Energy 
        Program, Public Citizen.

                        COMMITTEE COST ESTIMATE

    Pursuant to clause 3(d)(1) of rule XIII, the Committee 
adopts as its own the cost estimate prepared by the Director of 
the Congressional Budget Office pursuant to section 402 of the 
Congressional Budget Act of 1974. At the time this report was 
filed, the estimate was not available.

       EARMARK, LIMITED TAX BENEFITS, AND LIMITED TARIFF BENEFITS

    Pursuant to clause 9(e), 9(f), and 9(g) of rule XXI, the 
Committee finds that H.R. 1068 contains no earmarks, limited 
tax benefits, or limited tariff benefits.

                      ADVISORY COMMITTEE STATEMENT

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                  APPLICABILITY TO LEGISLATIVE BRANCH

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

             SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION

Section 1. Short title

    Section 1 provides the short title of ``Securing America's 
Critical Minerals Supply Act''.

Section 2. Amendment to the Department of Energy Organization Act

    Section 2 amends the Department of Energy Organization Act 
to define critical energy resources as energy resources 
essential to the U.S. energy sector and energy systems, the 
supply chains of which are vulnerable to disruption, and by 
establishing that a purpose of the Department of Energy is to 
ensure there is an adequate and reliable supply of critical 
energy resources that are essential to U.S. energy security and 
by including new functions of the Department relating to 
securing critical energy resource supplies.

Section 3. Securing critical energy resource supply chains

    Section 3 provides that, in carrying out the requirements 
of Department of Energy Organization Act, the Secretary, in 
consultation with appropriate agencies, States, and 
stakeholders, shall conduct ongoing assessments of the nation's 
supply of critical energy resources, energy resource 
criticality based on importance to the development of energy 
technologies and energy supply, and to facilitate development 
of strategies to strengthen critical energy resource supply 
chains by diversifying sources and increasing domestic 
production, refining, and processing of resources, and that the 
Secretary develop substitutes and alternatives and improve 
technology that reuses or recycles critical energy resources.

         CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

    With respect to the requirement of clause 3(e) of rule XIII 
of the Rules of the House of Representatives, changes in 
existing law made by the bill, as reported, this section was 
not made available to the Committee in time for the filing of 
this report.

                             MINORITY VIEWS

    H.R. 1068, the ``Securing America's Critical Minerals 
Supply Act,'' amends the Department of Energy Organization Act 
to assert the Department of Energy's (DOE) role in securing 
critical energy resource supply chains. The bill directs DOE to 
conduct ongoing assessments and facilitate the development of 
strategies to strengthen critical energy resource supply 
chains.
    While the majority claims H.R. 1068 targets and supports 
the development of critical minerals, including those needed 
for the development of clean and renewable energy resources, 
H.R. 1068 uses the term ``critical energy resource'' instead of 
``critical minerals'' or ``critical materials.'' The bill 
defines ``critical energy resource'' to mean ``any energy 
resource that is essential to the energy sector and energy 
systems of the United States.'' This definition is not 
restricted to critical minerals and could be interpreted to 
include a range of resources, including those that are carbon-
emitting or that support the fossil-fuel industry. The bill 
also does not specify or prioritize the securing of supply 
chains related to clean or renewable energy, even though the 
majority claims the bill will support these industries. Without 
a clear prioritization of clean energy supply chains, H.R. 1068 
risks devoting additional DOE resources to supporting carbon-
emitting industries. Additionally, there is ambiguity 
surrounding the definition of ``critical energy resource'' in 
H.R. 1068, and how it will interact with existing DOE efforts 
in the critical minerals and critical materials space. For 
example, the Department of Energy is currently drafting a list 
of critical materials using the definition established in the 
Energy Act of 2020.\1\ H.R. 1068 does not attempt to reconcile 
definitions with existing directives, and additional 
specificity would be needed.
---------------------------------------------------------------------------
    \1\Department of Energy, Critical Minerals and Materials 
(www.energy.gov/critical-minerals-materials) (accessed Mar. 21, 2023).
---------------------------------------------------------------------------
    The Biden Administration, through the Bipartisan 
Infrastructure Law and the Inflation Reduction Act, has taken 
steps to develop and onshore clean energy supply chains. For 
example, the Bipartisan Infrastructure Law included $3 billion 
for Battery Materials Processing Grants and $3 billion for 
Battery Manufacturing and Recycling Grants.\2\ Additionally, 
the Inflation Reduction Act established a series of incentives 
that prioritize clean energy technologies with specific 
critical minerals and manufacturing requirements, including 
domestic content requirements.\3\ As a result of these 
investments, DOE is already playing an important role in 
securing clean energy supply chains.
---------------------------------------------------------------------------
    \2\The White House, A Guidebook to the Bipartisan Infrastructure 
Law for State, Local, Tribal, and Territorial Governments, and Other 
Partners (May 2022) (www.whitehouse.gov/wp-content/uploads/2022/05/
BUILDING-A-BETTER-AMERICA-V2.pdf).
    \3\The White House, Building a Clean Energy Economy: A Guidebook to 
the Inflation Reduction Act's Investments in Clean Energy and Climate 
Action (Jan. 2023) (www.whitehouse.gov/wp-content/uploads/2022/12/
Inflation-Reduction-Act-Guidebook.pdf).
---------------------------------------------------------------------------
    Given the climate crisis, we acknowledge that additional 
work is needed to meet increasing demand for clean energy. 
However, rather than focusing this bill and the DOE's efforts 
on critical minerals needed for the clean energy transition, 
H.R. 1068 obscures the application of this language to 
potentially include fossil fuel industries.
    We support DOE's ongoing role in developing and securing 
critical mineral supply chains needed for clean energy, but are 
concerned that this bill is too vague. Additionally, we 
acknowledge the urgent need to onshore and secure critical 
minerals for the clean energy transition. However, this bill is 
not the best approach. We question the assertions made in the 
majority's report, which state that this bill will help the 
clean energy transition. While a narrow interpretation of this 
bill will help the clean energy transition, we oppose this 
legislation as drafted due to the ambiguity of the term 
``critical energy resource.''

                                        Frank Pallone, Jr.,
                  Ranking Member, Committee on Energy and Commerce.

                                  [all]