"Global security requires a completely new view on waste"

Madeleine Ljunggren, Chief Financial Officer and Lars Lindén, CEO.

As we look back on 2023, it is obvious how war and conflict have dominated the news. For all those suffering from armed conflicts, the year was a disaster. For those of us fortunate enough to observe the deeply concerning development from a position of safety and stability, we must reflect on our role in conflicts around the world.

It is well established in the field of peace and conflict studies that access to raw materials has long been one of the foremost forces driving armed conflicts. According to the United Nations Environment Programme (UNEP), natural resources have been linked to at least 40 percent of intrastate conflicts in the last 60 years.

The competition for scarce natural resources is a significant contributor to tensions affecting people's safety and health. Although it this does not necessarily lead to invasion, conflicts often arise in countries that are rich in natural resources but built on weak institutions. These conflicts frequently result in human rights violations and are often driven by the consumption of raw materials by wealthier countries.

All indications point to the increasing intensification of the race for strategically important raw materials. This trend is partly driven by the shift towards renewable energy sources, electrification, and digitalisation, all necessary to counter climate change. A few examples:

• The demand for lithium in the EU is forecast to increase by over 1,000 percent by 2030 due to the fast-paced development of batteries for electric vehicles and energy storage. According to the European Commission, the demand for lithium is predicted to be more than 20 times higher by 2050 than it is today.
• So-called rare earth elements are an essential component in electric vehicles that will eventually replace today's fossil-fueled fleet, and play a crucial role in the production of wind turbine magnets. Europe's demand for these elements is expected to increase by at least 400 percent by 2030.
• Accelerating climate change also increases the risk of water scarcity, and many of the countries hardest hit by the climate crisis are located in regions that are already unstable or plagued by conflict.
• On top of these developments, the Earth's population is expected to reach ten billion people in just a few decades. With so many people to feed, agriculture will require an enormous amount of fertiliser nutrients such as phosphorus, nitrogen, and potassium to produce enough food.

Approximately half of the world's climate emissions are caused by the constant extraction and processing of virgin raw materials, according to the UN. This constant search for new resources is also responsible for 90 percent of the threat to biodiversity and 90 percent of the increasing scarcity of water. All of these factors contribute to a more insecure world. Obviously, simply carrying on sourcing raw materials like we do today is not an option.

However, wealthier nations have become mired in unsustainable systems that rely on virgin extraction and imports to secure the supply of many raw materials. China completely dominates the market for rare earth elements, which creates an almost incalculable strategic risk. The Democratic Republic of Congo produces two-thirds of the world's cobalt, a crucial material for battery production, but the region has been plagued by armed conflict, human rights abuses, and child labor for decades. We buy phosphorus from mines in Western Sahara, under Moroccan control, although the issue of Morocco's right to the territory remains unresolved. In addition, the EU continues to import millions of tonnes of phosphorus and other fertilisers from Russia every year, despite the attempts to curb Vladimir Putin's war in Ukraine through sanctions.

If we are serious about creating a sustainable society, we have to use the raw materials we have already extracted, over and over again, as often as possible. However, the majority of laws, taxes, and other instruments that we have today are based on the linear economy, which assumes that virgin raw materials are almost limitless and which don't account for the emissions and other impact caused by their extraction and processing. This makes it very difficult to achieve a circular society.

For instance, we can produce large quantities of phosphorus from sewage sludge, but it cannot be legally used in organic farming or animal feed in the EU, since its source is classified as waste. As a result, we remain dependent on importing phosphate from problematic sources like Russia. Similarly, bottom ash from waste-to-energy facilities in Ragn-Sells’ home country, Sweden, contains significant amounts of copper, but tax rules designed to minimise waste mean that extracting all of it comes with a net loss. There are countless examples of these restrictions on circularity.

We need a profound paradigm shift in our view on waste, turning waste into the primary source of sustainable raw materials. We see the need for the following measures:

• Change the basic principle. Rather than myopically focusing on reducing waste that goes into landfills, we should adopt a strategy for sustainable raw material supply and base all policy on it. The EU can set an example for the rest of the world by implementing forward-thinking le
• Tax-exempt waste that can be a valuable source of raw materials. Today, it is generally cheaper to extract new raw materials than to use those that already exist. Sources of sustainable raw materials should not be minimised through misguided taxation, but used in large-scale production.
• Enable strategic storage of waste. In the future, when new technology will make it possible to extract more raw materials from waste, these materials need to be readily available and not dispersed because they could not be stored. Legislative changes and tax exemptions are necessary to prevent the short-sighted dispersion of waste.

A world where we use critical raw materials over and over again, instead of resorting to weapons in the hunt for increasingly depleted virgin sources, is a safer world. Let 2024 be the year when this paradigm shift change takes off.

Madeleine Ljunggren, Chief Financial Officer of the environmental company Ragn-Sells

Lars Lindén, CEO of the environmental company Ragn-Sells