Sponsors promote bills to open up domestic market

Manuel Quinones, E&E reporter Thursday, December 8, 2011

With several House and Senate bills circulating to promote the domestic availability of materials essential for technological innovation and clean energy, including rare earth elements, backers are racing to push theirs into prominence.

In a hearing yesterday of the House Science Committee's Energy and Environment Subcommittee, members pressed for consideration of measures under the panel's jurisdiction.

North Carolina Democratic Rep. Brad Miller's legislation (H.R. 952) calls for loan guarantees, research and better coordination among government agencies. Rep. Randy Hultgren (R-Ill.) says his H.R. 2090 takes a market-based approach by limiting research to areas that private industry is not likely to do on its own.

Robert Jaffe, a Massachusetts Institute of Technology physics professor who helped author a report on critical materials, said he was partial to Hultgren's approach. He said it promoted "information, research and recycling" but "without unnecessary overreach."

While Miller said he likes aspects of the Hultgren bill, he touted his own measure's mandates that certain actions be taken regardless of who is occupying the White House.

"I hope the committee can take that matter up and consider the bill along with Mr. Hultgren's," Miller said. "I hope that we will work out a compromise bill."

Much of the attention in the House has gone to legislation (H.R. 2011) sponsored by Rep. Doug Lamborn (R-Colo.) and Rep. Doc Hastings (R-Wash.). As chairman of the Natural Resources Committee, Hastings helped usher the bill toward quick passage (E&ENews PM, July 20).

In the Senate, pieces of legislation by Sens. Mark Udall (D-Colo.) and Lisa Murkowski (R-Alaska) are pending before the Energy and Natural Resources Committee. A compromise bill could emerge from negotiations there, too.

Government's role

Chinese control of the worldwide rare earths market prompted lawmakers during the last Congress to increase their focus on a broad array of materials critical to technologies -- including cars, mobile phones, wind turbines and solar power plants.

But price and supply uncertainties have led companies to boost mining and look for alternatives. Skeptics are increasingly asking themselves, what is government's role?

"The market is working fine," said Heritage Foundation scholar Derek Scissors, an expert on the Chinese economy, voicing his opposition for loan guarantees and other subsidies.

But Miller said swift action is necessary.

"Waiting for the market to solve its own problems will be a very long wait," Miller said. "There is ample evidence of ample [market] failure here."

There is agreement among experts and across party lines that government can help provide the information and research that the private sector can't do on its own. U.S. Geological Survey global material assessments are one example.

Despite the argument, most experts seem to agree that some legislation is necessary to boost U.S. competitiveness. Ames National Laboratory senior materials scientist Karl Gschneidner said that while U.S. rare earth mining and magnet development is moving forward, the industry is still weak.

Referring to powerful rare earth magnets, used in cars and other applications, he said, "What are we going to do with them? We're going to ship them back to China? Things are moving but we do need help."

Amid GOP skepticism of government economic help for clean tech, Luka Erceg, president and CEO of Simbol, Inc., said a $3 million Department of Energy Grant in 2009 helped develop the company and attract other support. Simbol is developing an operation to extract lithium from geothermal brines for advanced batteries.

Erceg, like other executives in prior hearings, urged lawmakers to consider the lack of knowledge about critical materials in the U.S. workforce. He said talent and private expertise were hard to find. The company sought help from the Lawrence Livermore National Laboratory.

"What we are lacking in this country is the ability to produce these materials and process them," Erceg said. "Critical materials support innovation and we need to foster that innovation."