Energy Resource Governance Initiative Act of 2021

To establish in the Department of State the United States Energy Resource Governance Initiative to promote sound mining sector governance and resilient energy mineral supply chains by bringing countries together to engage on advancing governance principles, sharing best practices, and encouraging a level playing field for investment, and for other purposes. 1. Short title This Act may be cited as the Energy Resource Governance Initiative Act of 2021 2. Sense of Congress It is the sense of Congress that— (1) diverse and resilient energy and mineral supply chains are vital for the United States, our partners and allies, and for global economic stability; (2) many green and renewable energy technologies, including electric vehicles, wind turbines, and battery storage technology, require high inputs of specific energy minerals, which may cause the global demand for these products to skyrocket over the coming decades; (3) United States and international efforts to drive global emission reductions and net zero goals rely on these critical minerals to deploy clean energy technologies; (4) vulnerable critical mineral supply chains present a significant risk to United States national security interests, including— (A) overreliance on a single or limited supply source for critical mineral inputs; and (B) poor mineral sector governance, including weak labor standards, limited environmental protections, failure to develop a social license to operate, which deters responsible investment and limits the long-term sustainability of mining operations; (5) the People’s Republic of China (PRC) leads the world in the mining and production of rare earth metals, comprising nearly 90 percent of the global market, and it is in the national security interest of the United States to provide an alternative to PRC domination of these supply chains; and (6) the United States should build upon the efforts made with the Governments of Australia, Botswana, Canada, and Peru in creating the Energy Resource Governance Initiative (ERGI) to advance governance principles and best practices for mineral extraction. 3. Statement of policy It is the policy of the United States to— (1) promote sound mining sector governance and resilient energy mineral supply chains by bringing countries together to engage on advancing governance principles, sharing best practices, and encouraging a level playing field for investment; (2) encourage governments to incorporate responsible mineral supply chain sourcing principles into their national climate strategies and clean energy technology procurement plans; and (3) encourage companies, including green and renewable energy, to source 100 percent of their critical mineral supply from responsible and environmentally sound supply chains by 2030. 4. Energy resource governance initiative (a) Establishment There is established in the Department of State an entity to be known as the Energy Resource Governance Initiative (b) Objectives The objectives of the Energy Resource Governance Initiative established under subsection (a) are to carry out the following: (1) Promote responsible and sustainable mining practices globally by enabling sharing of best practices for mineral extraction management and governance. (2) Foster integrated and resilient supply chains and help identify options to diversify and strengthen supply chains. (3) Facilitate trade and industry connections to promote responsible critical mineral sourcing and advance mineral sector good governance. (4) Facilitate mineral sector technical assistance to partner countries to identify new supply chain opportunities, sustainably and responsibly commercialize critical mineral sector resources, and mitigate supply chain vulnerabilities. (5) Encourage the international community to incorporate responsible mineral supply chain sourcing principles, including resource surveys, into their national climate strategies and clean energy technology procurement plans. (6) Seek to minimize the adverse impact that increasing renewable energy demand could have on mineral‐rich countries. (c) Eligible activities Activities carried out under the Energy Resource Governance Initiative shall— (1) be carried out in countries in which the Secretary of State determines there is an adequate level of partner country commitment, partner country needs, absorptive capacity, sustainment capacity, and efforts of private sector donors; (2) be closely coordinated among diplomatic and development missions, and relevant participating Federal departments and agencies; and (3) complement and enhance efforts to promote democratic governance, the rule of law, human rights, and economic growth. (d) Diplomatic and political support The Secretary of State, in coordination with other relevant Federal departments and agencies, shall provide diplomatic and political support to partner countries, including by using the diplomatic and political influence and expertise of the Department of State to build the capacity of such countries to resolve any impediments to the implementation of activities pursuant to subsection (c). (e) Coordination with private sector The Secretary of State, through the Bureau of Energy Resources of the Department of State, shall coordinate with the United States International Development Finance Corporation to mobilize private sector engagement and partnership to facilitate the objectives described in subsection (b), including by supporting investment frameworks that attract top tier private sector investment focused on responsible mineral extraction. (f) Report Not later than 180 days after the date of the enactment of this Act and annually thereafter for the following ten years, the Secretary of State shall provide a report to the appropriate congressional committees that includes assessments of— (1) progress towards achievement of the objectives described in subsection (b); (2) success of coordination with the private sector pursuant to subsection (e); (3) efforts by the Chinese Communist Party or related entities to influence the policies of ERGI partner countries with regard to their mining sectors or supply chains; and (4) how ERGI is furthering the national security interests of the United States. (g) Definition In this section, the term appropriate congressional committees (1) the Committee on Foreign Affairs of the House of Representatives; and (2) the Committee on Foreign Relations of the Senate.

Summary: Energy Resource Governance Initiative Act of 2021 This bill establishes the Energy Resource Governance Initiative within the Department of State to promote responsible and sustainable mining practices through international collaboration. The initiative must seek to foster integrated and resilient supply chains, responsible critical mineral sourcing, and mineral-sector good governance. It must also seek to minimize potential adverse impacts of increasing renewable energy demand on mineral-rich countries.