Introduction Rising carbon emissions have driven global warming and more extreme weather, making the shift to low-carbon technologies essential. The energy transition, from fossil fuels to renewables like solar, wind, hydro and geothermal, also requires decarbonizing key sectors such as transport. The transportation sector accounts for 37% of global emissions and has grown at an average annual rate of 1.7% over the past 30 years, faster than any other sector.1 Decarbonizing transportation will hinge on various enablers, including faster adoption of EVs as a sustainable alternative to internal-combustion engine (ICE) vehicles. Renewable energy and electric vehicle (EV) development rely on technologies like battery storage, solar panels, wind turbines and advanced grids. Key minerals such as lithium, cobalt, nickel and graphite are critical for lithium-ion batteries, while rare earth elements are used in magnets for wind turbines and EV motors. Copper is essential for wiring and PGMs support fuel cells and electrolysers.2 These minerals and others are collectively referred to as “critical minerals”, which the International Energy Agency (IEA) classifies as minerals vital for the energy transition but vulnerable to supply disruptions.3 Most of the countries and multilateral organizations involved in the IEA also define a list of critical minerals based on their strategic needs. The African Union’s Green Mineral Strategy defines “green minerals” as “minerals that are used in clean energy technologies and green industries, that can maximize the benefits of Africa’s mineral endowment and those that are feedstocks for resource-based industrialization of clean energy industries.”4 This contrasts with approaches like the United States (US) Energy Act of 2020, which lists 50 critical minerals based on economic and national security needs, reflecting a focus on supply security rather than production.5 Under IEA’s net-zero scenario, demand for critical minerals is expected to quadruple by 2040, driven by clean energy technologies.6 However, reserves and production are highly concentrated, risking supply disruptions amid growing demand.7 For example, the DRC holds 55% of global cobalt reserves and produces 74% of global cobalt supply. China produces 69% of the world’s rare earth elements and holds 40% of global reserves. Indonesia accounts for 50% of nickel production and 42% of reserves.Surging demand for critical minerals offers an opportunity to expand and diversify global supply chains. The energy transition and critical minerals Demand for critical minerals is expected to quadruple by 2040. Securing Minerals for the Energy Transition: Finance for Southern Africa 6

Securing Minerals for the Energy Transition 2025