DRC: With better governance, considerable benefits could be reaped from the energy transition
Enormous profits could be drawn by the Democratic Republic of Congo (DRC) within the framework of the energy transition if and only if the country demonstrated good governance. This is revealed in a report published on March 25, 2022 by the Natural Resource Governance Institute (NRGI), entitled “Taking advantage of cobalt in the Democratic Republic of Congo within the framework of the energy transition requires better governance”.
According to the report, the Democratic Republic of Congo (DRC) and other countries rich in critical minerals could benefit significantly from the opportunities presented by the energy transition and play an important role in accelerating it.
To do this, the report indicates that it is necessary to “strengthen the governance of the extractive sectors” of these countries as soon as possible.
According to the NRGI researchers, the DRC has placed itself in a unique position, but limited in time. Thus, they note, cobalt, of which it has the largest deposits in the world, is an essential element for the production of batteries for electric vehicles.
Demand for these batteries, says the report, is growing at the rate of increased demand for electric vehicles, but will only last as long as the energy transition takes place, or even less if poor governance of cobalt induces producers of electric vehicles to reduce their dependence. against this metal.
Reforms, a sine qua non
“As part of the energy transition, the DRC does not have much time to maximize its potential revenues from cobalt and attract the necessary additional investments. Accelerating governance reforms from the allocation of licenses to the management of revenues and environmental and social impacts is a key condition for this”, said Hervé Lado, Regional Manager for West Africa and of the Center (francophone) of NRGI.
NRGI argues in its report that since 2002, the country has embarked on major reforms of the extractive sector in order to take full advantage of its natural resources. And the mining policies already in place, he continues, provide a framework for ensuring good governance of cobalt mining. It also notes that the Government of the DRC could “enhance these existing legal frameworks by ensuring their effective implementation, particularly in the areas of licensing, taxation and the fight against corruption”.
Electric batteries, major element
In addition, the report highlights that Governments and their advisers in mining countries, such as the DRC, could support their companies to strengthen their presence in the electric battery supply chain.
The report also emphasizes the importance of considering the environmental and social impacts of mining.
Given that some of the DRC’s largest sources of cobalt are in sensitive areas, with the risk of further deforestation, the report highlights the importance of ensuring environmental protection and respect for human rights , especially in artisanal mining.
For Roger Vutsoro, NRGI manager for the DRC, “the DRC government must ensure that populations suffer less and less from the negative effects of cobalt mining, including by removing children and women from the mines , and above all that they benefit from it in a substantial way. In addition, the impacts on the environment, in particular forests, must be better controlled and minimized”.
Net zero carbon
The report also recalls that the planet has 28 years left to reach the net zero carbon objective by completing the transition to clean energies.
In view of the long delays in the development of mining projects and legislative processes, experts believe that this period is not long.
If the DRC and its neighbors remain too risky to invest in, they believe, the powerful global supply chains will find a way out of cobalt, as already observed and as has been the case for several critical minerals by the pass.
With this in mind, the new report from NRGI offers concrete actions to bring about the changes necessary for the good management of cobalt.