Democrats Plan Reform to 1872 Mining Law to Reach Clean Energy Goals

By Anjali Joshi

While the Biden Administration seeks to spur the production of critical minerals used in EV batteries, Biden’s Democratic Party is addressing what it considers outdated mining permit issues.

The Mining Law of 1872 allows mining of different critical minerals on federal public lands at no cost once the permit is provided to mining companies. Unlike other extractive industries like coal, and oil & gas, mining companies are exempted from paying royalties for mining activities on federal lands. The current mining law does not hold any strong environmental protection or consultation with tribal communities. The current law also does not make mining companies accountable for the pollution caused by mining activities, thus affecting communities and the environment.

The U.S. House Natural Resources Chairman Raúl Grijalva of Arizona and U.S. Sen. Martin Heinrich of New Mexico have each introduced bills aiming to modernize and reform the unchanged, 150-year-old mining law. Both legislations require mining companies to take the responsibility of cleaning up abandoned mines, consult with tribal communities throughout the mining project, and pay royalties for the revenue from using federal lands.

Under these legislations, miners would be required to pay a 12.5% royalty rate for operations on federal lands and 8% royalty rate on existing lands. One quarter of the total royalty would direct toward the state where the mine is located. The remaining amount would go to the Hardrock Mine Reclamation Fund created under the US$1.2 trillion infrastructure law in 2021 to clean up abandoned mining sites.

On May 11, the Biden Administration unveiled an action plan to improve the permitting process for large infrastructure projects under the Bipartisan Infrastructure Law. This includes the upgradation of the outdated permitting laws and regulations, including the Mining Law of 1872, to establish stronger environmental, sustainability, safety, tribal consultation, and community engagement standards.