119-s596

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 596 Introduced in Senate

    (IS) ]

<DOC>

119th CONGRESS
 1st Session
 S. 596

 To establish a pilot program to support domestic critical material 
 processing, and for other purposes.

_______________________________________________________________________

 IN THE SENATE OF THE UNITED STATES

 February 13, 2025

 Mr. Hickenlooper (for himself, Mr. Graham, Mr. Coons, and Mr. Young) 
introduced the following bill; which was read twice and referred to the 
 Committee on Energy and Natural Resources

_______________________________________________________________________

 A BILL

 To establish a pilot program to support domestic critical material 
 processing, and for other purposes.

 Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

 This Act may be cited as the ``Critical Materials Future Act of 
2025''.

SEC. 2. DEFINITIONS.

 In this Act:

    (1) Country of risk.--The term ``country of risk'' has the 
 meaning given the term in 

section 10114

    (a) of the Research and 
 Development, Competition, and Innovation Act (42 U.S.C. 
 18912

    (a) ).

    (2) Critical material.--The term ``critical material'' has 
 the meaning given the term in 

section 7002

    (a) of the Energy Act 
 of 2020 (30 U.S.C. 1606

    (a) ).

    (3) Domestic.--The term ``domestic'' means facilities 
 operating within the United States or within any territory or 
 possession of the United States.

    (4) Eligible project.--The term ``eligible project'' means 
 a project that refines and processes or recycles raw critical 
 materials into purified forms suitable for first-use 
 applications.

    (5) Entity of concern.--
        (A) In general.--The term ``entity of concern'' has 
 the meaning given the term in 

section 10114

    (a) of the 
 Research and Development, Competition, and Innovation 
 Act (42 U.S.C. 18912

    (a) ); and
        (B) Inclusion.--The term ``entity of concern'' 
 includes an entity that the Secretary has determined, 
 using a risk-based approach, is subject to the control 
 or influence of a foreign nation whose strategic 
 interests concerning critical materials does not align 
 with the strategic interests of the United States.

    (6) Innovative financial tools.--The term ``innovative 
 financial tools'' means financial instruments to support 
 demand-side economic mechanisms, including--
        (A) pricing support mechanisms, such as contracts 
 for difference and price floors, advanced market 
 commitments, and forward contracts; and
        (B) other transactions that the Secretary may enter 
 into under 

section 646 of the Department of Energy 
 Organization Act (42 U.S.C. 7256).

    (7) Pilot program.--The term ``Pilot Program'' means the 
 Domestic Critical Material Processing Pilot Program established 
 under 

section 4

    (a) .

    (8) Reliable sources.--
        (A) In general.--The term ``reliable source'' has 
 the meaning given the term in 

section 12 of the 
 Strategic and Critical Materials Stock Piling Act (50 
 U.S.C. 98h-3).
        (B) Inclusions.--The term ``reliable source'' 
 includes facilities owned by, controlled by, or subject 
 to the jurisdiction of any country--
            (i) with which the United States has a free 
 trade agreement in effect; and
            (ii) designated a major non-NATO ally under 
 

section 517 of the Foreign Assistance Act of 
 1961 (22 U.S.C. 2321k).

    (9) Secretary.--The term ``Secretary'' means the Secretary 
 of Energy.

SEC. 3. PURPOSES.

 The purposes of this Act are--

    (1) to support domestic critical material processing with 
 innovative financial tools to reduce supply chain 
 vulnerabilities and enhance energy and national security; and

    (2) to evaluate the effectiveness of innovative financial 
 tools in supporting investment in and expanding domestic 
 critical materials processing, including the impact of 
 different support mechanisms on project development for various 
 critical materials and fostering more liquid, transparent, and 
 predictable markets for critical materials.

SEC. 4. DOMESTIC CRITICAL MATERIAL PROCESSING PILOT PROGRAM.

    (a) Establishment.--Not later than 180 days after the date of 
enactment of this Act, the Secretary shall establish a pilot program, 
to be known as the ``Domestic Critical Material Processing Pilot 
Program'', to support not fewer than 3 domestic critical material 
processing projects.

    (b) Objectives.--The objectives of the Pilot Program are--

    (1) to provide financial stability and attract private 
 investment in eligible domestic critical material processing 
 projects;

    (2) to analyze how different financial tools influence 
 critical material market dynamics and projects and the 
 estimated level of financial support needed to secure reliable 
 United States supply chains for various critical materials and 
 support a sufficient domestic critical materials processing 
 industry; and

    (3) to reduce supply chain vulnerabilities and enhance 
 energy security and national security.
            (c) Requirements.--

    (1) Implementation.--
        (A) Regulations.--Not later than 180 days after the 
 date of enactment of this Act, the Secretary shall 
 issue regulations to implement the Pilot Program.
        (B) Other transaction authority.--In carrying out 
 the Pilot Program, the Secretary shall have the 
 authority to enter into other transactions in the same 
 manner and subject to the same terms and conditions as 
 transactions that the Secretary may enter into under 
 

section 646 of the Department of Energy Organization 
 Act (42 U.S.C. 7256).
            (C) Flexible hiring authority.--The Secretary may 
 appoint and fix the compensation of such temporary 
 personnel as may be necessary to carry out and 
 implement the Pilot Program, without regard to the 
 provisions of subchapter I of chapter 33 of title 5, 
 United States Code, governing appointments in 
 competitive service and compensation of personnel.
            (D) Consultation.--The Secretary shall consult 
 outside stakeholders and experts, including mining and 
 critical material processing industry representatives, 
 financial experts, and academic researchers, during 
 development of the Pilot Program for purposes of 
 improving the effectiveness and efficiency of the Pilot 
 Program.

    (2) Diversity.--
        (A) In general.--Subject to subparagraph
        (B) , the 
 Pilot Program shall provide support for the processing 
 of not fewer than 3 different critical materials in 
 order to gain insight into the impact of innovative 
 financial tools on different critical material markets.
        (B) Limitation.--Support provided under 
 subparagraph
        (A) to a single critical material shall 
 not exceed 50 percent of any funding provided to the 
 Pilot Program under subsection

    (h) .

    (3) Sunset.--The Pilot Program shall terminate on the date 
 that is not later than 5 years after the date the Pilot Program 
 is established under subsection

    (a) .
            (d) Applications.--

    (1) In general.--Applications under the Pilot Program for 
 eligible projects shall be submitted to the Secretary at such 
 time, in such manner, and containing such information as the 
 Secretary may require.

    (2) Eligibility criteria.--
        (A) In general.--The Secretary shall review and 
 select applications under the Pilot Program for 
 eligible projects based on--
            (i) the potential of the eligible project 
 to enhance the economic, energy, and national 
 security of the United States;
            (ii) the economic competitiveness of the 
 eligible project;
            (iii) the economic and financial 
 sustainability of the eligible project, using 
 information such as--
            (I) the potential for the applicant 
 of the eligible project to secure an 
 offtake agreement if the eligible 
 project is selected; and
            (II) an analysis of the estimated 
 production costs of the eligible 
 project and prevailing or anticipated 
 market prices;
            (iv) the potential of the eligible project 
 to mitigate risks associated with importing 
 critical materials from entities of concern;
            (v) the prioritization requirements 
 described in subparagraph
        (B) ; and
            (vi) other factors, as determined by the 
 Secretary, in coordination with the agencies 
 described in subsection

    (e) .
        (B) Priority.--In selecting applications under the 
 Pilot Program for eligible projects, the Secretary 
 shall prioritize eligible projects--
            (i) that use feedstock from domestic or 
 reliable sources, with higher priority given to 
 eligible projects that have greater use of 
 feedstock from domestic sources;
            (ii) the selection of which would support 
 the ability of the applicant to secure an 
 offtake agreement with domestic or reliable 
 sources; and
            (iii) that are the most economically 
 competitive, as determined by the Secretary, 
 based on factors including--
            (I) the potential for the applicant 
 of the eligible project to secure an 
 offtake agreement if selected; and
            (II) the difference between the 
 estimated production costs of the 
 eligible project and prevailing or 
 anticipated market prices.

    (3) Timeline.--The Secretary shall select applications 
 under the Pilot Program for eligible projects not later than 1 
 year after the date of enactment of this Act.

    (e) Coordination.--

    (1) In general.--To ensure the efficient implementation and 
 operation of the Pilot Program, the Secretary shall coordinate 
 with--
        (A) the Secretary of Commerce;
        (B) the Secretary of Defense;
            (C) the Secretary of the Interior;
            (D) the Secretary of State;
        (E) the Director of the United States Geological 
 Survey;
        (F) the United States Trade Representative; and
        (G) the heads of other Federal departments and 
 agencies, as determined by the Secretary.

    (2) Security research and development.--When selecting 
 applications and determining the level of financial support for 
 each project under the Pilot Program, the Secretary shall 
 coordinate with the Secretary of Defense to incorporate 
 insights from the Open Price Exploration for National Security 
 research and development program of the Defense Advanced 
 Research Projects Agency.

    (f) Study.--

    (1) In general.--Not later than 2 years after the date on 
 which the Pilot Program terminates under subsection
            (c) (3) , the 
 Secretary shall conduct and publish a study on--
        (A) the impact of innovative financial tools on the 
 critical materials sector and the relative cost-
 effectiveness of those tools in supporting domestic 
 critical materials processing projects and developing 
 more liquid, transparent, and predictable markets for 
 critical materials;
        (B) the estimated level of financial support needed 
 to secure reliable United States supply chains for 
 various critical materials and support a sufficient 
 domestic critical materials processing industry;
            (C) the potential of critical material recycling to 
 support the domestic critical materials market;
            (D) the effectiveness of the Pilot Program, 
 including an evaluation of each eligible project 
 supported by the Pilot Program; and
        (E) whether the models of the Open Price 
 Exploration for National Security research and 
 development program of the Defense Advanced Research 
 Projects Agency allowed the Pilot Program to better 
 anticipate market trends, optimize resource allocation, 
 and provide the appropriate level of support based on 
 current and future critical material market needs.

    (2) Insights.--The study under paragraph

    (1) shall include 
 insights into concerns of private investors in different 
 critical material markets and the impact of innovative 
 financial tools on catalyzing final investment decisions.

    (3) Stakeholder engagement.--The study under paragraph

    (1) shall be carried out in consultation with relevant 
 stakeholders, as determined by the Secretary, including mining 
 and critical material processing industry representatives, 
 financial experts, local governments hosting critical material 
 processing projects, and academic researchers.

    (4) DARPA open program.--The Secretary shall share the 
 results of the study under paragraph

    (1) with the Open Price 
 Exploration for National Security research and development 
 program of the Defense Advanced Research Projects Agency to 
 inform ongoing research and development of tools to support 
 transparency in domestic critical materials markets.

    (g) Report.--

    (1) In general.--The Secretary shall submit to the 
 Committees on Energy and Natural Resources, Foreign Relations, 
 and Armed Services of the Senate, and the Committees on Natural 
 Resources, Energy and Commerce, and Armed Services of the House 
 of Representatives, an annual report for each year that the 
 Pilot Program is carried out.

    (2) Contents.--The report under paragraph

    (1) shall 
 include--
        (A) activities, expenditures, and outcomes of the 
 Pilot Program;
        (B) recommendations to Congress on the continuation 
 or expansion of the Pilot Program; and
            (C) recommendations for how the Federal Government 
 should use innovative financial tools--
            (i) to increase domestic critical materials 
 processing capacity;
            (ii) to strengthen domestic critical 
 material supply chains by increasing United 
 States processing capacity using domestic 
 feedstock;
            (iii) to mitigate market volatility;
            (iv) to boost price transparency in 
 critical materials markets;
            (v) to leverage market indices in countries 
 other than those designated as countries of 
 risk;
            (vi) to ensure long-term adequate supplies 
 of critical materials for the economy of the 
 United States; and
            (vii) to increase the domestic recycling of 
 critical materials.

    (h) Funding.--

    (1) Financial mechanisms.--
        (A) In general.--In establishing and carrying out 
 the Pilot Program, the Secretary shall enter into 
 agreements, including contracts, grants, and 
 cooperative agreements, and other transactions, as 
 determined by the Secretary, to enable the use of 
 innovative financial tools to support domestic critical 
 material processing projects.
        (B) Authority.--In carrying out subparagraph
        (A) , 
 the Secretary may use innovative financial tools, 
 including price support such as contracts for 
 differences, and leverage functions to develop and 
 drive critical materials processing to entities that 
 are not entities of concern, under such terms and 
 conditions as the Secretary determines to be necessary 
 or appropriate.

    (2) Reinvestment of revenue.--
        (A) Establishment.--There is established in the 
 Treasury of the United States a fund, to be known as 
 the ``Critical Materials Revolving Fund'' (referred to 
 in this paragraph as the ``Fund'').
        (B) === Purposes ===
-The Fund shall be available to the 
 Secretary as a revolving fund--
            (i) to reinvest amounts generated from 
 eligible projects into new critical materials 
 processing projects under the Pilot Program; 
 and
            (ii) to further enhance the objectives of 
 the Pilot Program.

    (3) Authorization of appropriations.--There is authorized 
 to be appropriated to the Secretary to carry out this Act 
 $750,000,000, to remain available until expended.
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