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Can European strategic autonomy be achieved without sufficiency? Modelling the implications of the Critical Raw Materials Act on the lithium value chain

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  • Pauline Bucciarelli
  • Vincent d'Herbemont

Abstract

The transition towards low-carbon and digital technologies is set to profoundly reshape metals markets, particularly those required for battery manufacturing. Amid growing geoeconomic fragmentation, this shift is accelerating the implementation of public policies aimed at securing supply and strengthening the resilience of strategic technology value chains. In this context, we explore the design of the recently adopted Critical Raw Materials Act (CRMA) in the European Union, focusing on the feasibility of its reshoring targets for battery-grade lithium.By integrating the entire lithium value chain into an Integrated Assessment Model, we analyse the interplay between lithium supply, demand, and recycling within decarbonisation scenarios. Our findings suggest significant challenges in meeting the CRMA targets without reducing industrial demand. We show that sufficiency strategies could help achieve these benchmarks, while cutting European lithium imports by at least 44% between 2030 and 2050 and reducing cumulative final demand by 1.2 Mt, a 46% decrease relative to current policy trajectories.More broadly, our analysis highlights sufficiency as a lever to reconcile ecological ambition with supply security, notably by enhancing the robustness of the lithium value chain. Finally, we recommend shifting the CRMA’s recycling benchmark towards an end-of-life recycling rate, as it is better suited to the dynamics of the lithium market.

Suggested Citation

  • Pauline Bucciarelli & Vincent d'Herbemont, 2025. "Can European strategic autonomy be achieved without sufficiency? Modelling the implications of the Critical Raw Materials Act on the lithium value chain," EconomiX Working Papers 2025-36, University of Paris Nanterre, EconomiX.
    • Handle: RePEc:drm:wpaper:2025-36
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    JEL classification:

    • Q32 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Exhaustible Resources and Economic Development
    • Q38 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Government Policy (includes OPEC Policy)
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis

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