Critical Raw Materials and Circular Economy. Effects of changes in Austrian supply and demand of ‘critical’ raw materials on circular economy and decarbonization.

Austria currently falls short of aligning its greenhouse gas (GHG) emissions trajectory with the objective of achieving carbon neutrality by 2040. More ambitious measures and a profound societal transformation are needed. Introducing circular economy and undergoing an energy transition are considered important in advancing towards this objective. However, do the ambitious targets outlined in the Austrian Circular Economy (CE) strategy facilitate or impede the broader goal of decarbonization? And how does the recently enacted Critical Raw Materials Act (CRMA) of 2023, which advocates for increased mining and mineral processing within the European Union (EU) and Austria, interfere with decarbonization and CE targets? The CRMA aims to mitigate supply risks associated with critical materials essential for future technologies, which are currently subject to high import dependence on a limited number of often politically unstable economies. But at the same time, the growth in the mining industry is anticipated to induce changes and eventual increases in both material and energy demand, potentially counteracting resource conservation and decarbonization efforts. To avoid dead-locks due to conflicting goals between the three policies – climate change, circular economy, critical raw materials act – the project GRACE proposes to take a systemic perspective on resource use, changes in stocks (buildings, infrastructure, vehicles), wastes and emissions by using the CE as an umbrella framework. GRACE will built a dynamic material stock-flow model based on an integration of previous models, but expanding these by aspects highly relevant but not yet considered in research: (1) disaggregation of material flow classification to better represent critical raw materials, (2) consideration of secondary materials in trade flows and production, (3) conceptual development of CE framework and indicators to better capture the 10R strategies, particularly those addressing “narrowing” and “slowing” of material cycles, and to consistently link input-oriented MFA approaches, GHG emission inventories and waste flows (system boundaries, waste definitions, data gaps, etc.). With this analysis of cross-cutting issues, GRACE aims to contribute novel insights to sustainable resource use and to inform policymaking by emphasizing co-beneficial measures and highlighting potential deadlocks by conflicting policy targets.