 Good morning, everybody. It's great to see such a good crowd this morning. I'm David Pumphrey. I'm a Deputy Director and Senior Fellow with the Energy and National Security Program. And it's really a great pleasure to welcome David Sandelow to come back to CSIS to give this presentation on the recent really released critical material strategy that the Department of Energy has done. As many of you know, David has been a real leader in the administration's efforts to transform the way in which the United States produces and consumes energy and put us on a lower carbon path. And in other parts of his job, the other side of his job as the Assistant Secretary of Policy International is working internationally to develop strategies moving forward. And it comes towards this lower carbon future. And it really, I think this presentation and the study the Department's doing is showing some of the new dimensions to thinking about a lower carbon world. And that is that there are critical materials that will play a role in these new technologies that we will be relying on. So last year in December, I guess actually a little over a year ago, December 2010, David was here and presented DOE's first report on critical materials. And it was an important effort to identify the criticality of the technologies as well as putting in place a framework for understanding what's critical, what's critical in the medium term and then the longer term. So we're very pleased that David's willing to come back and present this update and give us some sense of how things may have changed and what remains the same. So David, why don't you go ahead? Oh, administratively, please turn off your cell phones and we'll do questions and answers at the end of the session. Good morning, everybody. Happy New Year. Thank you, Dave, for hosting us and thank you for all of your leadership on these issues over the years. Dave used to work at the office I'm at at the Department of Energy. He left before I arrived. But he's been a real leader on these energy issues for many years, both inside government and outside government. Thanks to Frank Verastro, who I see in the back of the room for the same. And to CSIS for hosting us here. We greatly appreciate it. The critical material strategy that I am presenting today is really the product of a big team effort. Big team effort within the Department of Energy and a big team effort around the US government. Before I start, I want to thank the team that put it together from the Department of Energy and they are mostly here, particularly Diana Bauer, who's our team leader, who's right here, Dave Diamond, Brent Wanner, Mike McKittrick, and Jenny Lee. Many, many thanks for everything that you've done to help make this strategy possible and they helped coordinate a pretty big effort within the Department of Energy. And let's see, does that work? Great. So I'm going to spend a while going into some detail about our report, which is a pretty technical report. I tell you about our methodology, our findings, and then I'm happy to take questions. And here's the outline of today's presentation. I'm going to start by talking, just give some basic background, talk about some of our activities in the past year, and then get into the content of our report, talking about supply, demand, and criticality. We did three technology case studies I'll talk about. We talked about market dynamics, talked about our new R&D plan in this area, and then talk about next steps. So here just as basics on our project scope, for those who aren't familiar with this topic, the rare earth metals in particular, the lanthanides, or this column right here. And that was the core of our analysis. We also looked at a number of elements that are not rare earth metals, gallium, indium, tellurium, cobalt this year. We actually added two elements, manganese and nickel, that are used in electric vehicle batteries and were not looked at in last year's report. The focus of this report is looking at the use of all these elements, these rare earth elements and the others I just mentioned, in clean energy technologies, in wind turbines, in electric vehicles, in solar cells, and in lighting. This year we added an analysis of the use of rare earths in petroleum refinery, petroleum refinery partly because of increased gasoline prices that got a lot of national attention in the past year. We wanted to focus in particular on that issue, and I'll talk about our findings there. Some other basics here, just for those who don't know this issue well, rare earth metals are not, in fact, rare. They are found all over the world. And that said, 95% of current production of rare earth metals is in China, and that presents a number of challenges. But rare earth metals are actually more abundant than number of other kind of leading metals and are found all over the world. And here we have, you see on this map, minds that we anticipate will be coming online over the course of the next years and decades, roughly ordered in kind of chronological order, roughly numbered in chronological order by when they're anticipated to come online. You see number one is in the southwestern United States. That is the mountain pass mine owned by Mali Corp, which this year is anticipated to reach a production capacity of 20,000 tons and another 20,000 tons in a couple of years, I believe. A second mine in, you see in southwestern Australia, and then number of other mines coming online. I'll talk about that later. So here's a quick project history, which Dave already began to relate. In March 2010, we began work on our first strategy. It's actually the first time that Department of Energy had ever done the critical material strategy when we arrived. When I arrived in 2009, I surveyed and did an inventory of DOE's work in this area, and there was work going on in different offices around the Department of Energy complex, but it had never been pulled together into a single strategic framework. And we actually did a public request for information last year, and in 2010 released our first critical material strategy. And here's the basics of that report. We examined the role of rare earth metals and other materials in the clean energy economy. We identified five rare earth metals in indium as the most critical. And we'll go into a little bit more detail on this methodology as I talk about this year's report, but you see there on the Y-axis here, we have importance to the clean energy economy, and on the X-axis is supply risk. And the higher the numbers, the more serious the issues are. So the place that's the most critical is in the upper right hand quadrant there, and we identified dysprosium that's the most critical in the short term, and then bottom in the medium term as well. And that was last year. We also looked at research priorities and policy options last year when we kind of tried to lay a foundation for further dialogue and action in this area. I think really key, we identified three strategic pillars for our work in this area. For any critical materials, it's really a three-fold part of our strategy. The first is to diversify global supply chains. It's a century ago, famously Winston Churchill said with respect to oil, that security lies in variety and variety alone. And the same applies for any type of critical materials. Global supply chains are vital. Within global supply chains, the most secure supply is domestic supply, which is why I think the opening of the mountain pass mine and its production in Southern California is particularly important. But diversifying global supply chains is key. Developing substitutes is also key. And then reducing, we're using in a recycle, minimizing use, very important. And we also, in our report last year, talked about the material supply chain, which really goes from extraction to processing to putting the elements into components to end-use technologies and then recycling when you use. And I find, actually, often in the public dialogue on this, there's a lot of focus on the extraction end and on the supply side that's extremely important. But so are some of the other parts of the supply chain as well. So let's say a little bit about what DOE has done in the past year in the wake of this report, held a number of workshops over the course of last 13 or 14 months, a number of international workshops with the Japanese, Australians, EU, and ARPA-E held a workshop on this. We've invested considerable funds in research in this area with respect to permanent magnets for motors and wind generators, more than $40 million. And the ARPA-E React program is specifically focused on this. It's a $30 million program, and this is just on the permanent magnets part of this piece. And it's looking at material level substitutions. That means making permanent magnets that don't have or have reduced content of rare earth metals. And then also what we call component or system level substitutions, such as switch reluctance motors or other types of motors that don't require the use of rare earth elements. Here's an example with lots of text on it of one of our projects. This is an ARPA-E project looking at using cerium in magnets and reducing use and a number of players, including Mali Corp. The Ames Laboratory and a couple of companies, including General Motors, are working in this area. I should mention that the Ames Laboratory, which is part of the DOE National Laboratory Network, has really been the historic leader in research on rare earth metals over the course of many, many years, over the course of decades. In our DOE's technology research in photovoltaic cells, PVs, and batteries, we invest in a broad technology portfolio with diverse materials. And that's what one of our objectives is to diversify the supply chain in this area. And here you see on the left for photovoltaic cells. We're looking at the concurrent technology is based on cadmium, telluride, SIGs, and silicon, moving to a variety of different materials and minerals. Cadtel and SIGs rely upon some elements that are in short supply. So this is net moving towards more abundant earth materials. And the same thing with respect to battery research, moving towards materials that are more abundant is part of our strategy. It's not the only part of our strategy, but work in this area. It's partly designed to move towards more earth abundant materials. Really important point that I want to stress, because it's been such an important part of our life within the federal government over the course of the past year, is the extensive interagency coordination. And I see colleagues from the Department of Defense and others here in the audience. But what I'm presenting today is the Department of Energy's critical material strategy. This has been nested within coordinated work around the federal government on this topic, led by the Office of Science and Technology Policy out of the White House. And it's brought together the agencies whose logos you see here, which include not just DOE and DOD, but EPA and USTR and alphabet soup of agencies. And here are the topics that we've discussed, critical material, criterion prioritization, R&D prioritization, global supply chains, and transparency of information. So that's a quick summary of some of DOE's work over the past year, and then our interagency coordination on this topic. And so let me then go to the critical material strategy. For the Michigan Wolverine fans among you, I hope you appreciate how we managed to get blue and gold into this presentation. It was a great game the other night. So here's our timeline. In spring of 2011, we put out a public request for information. We got over 30 responses, very helpful from industry stakeholders, from others, some of which were submitted on a business confidential basis. In summer and fall, we'd analysis, drafting, and consultations by our DOE-wide team. And everybody I recognized at the beginning, I hope they got good rest over the holidays because they deserved it after a lot of hard work. And then we, right before the holidays, released our report. Our 2011 strategy does a few things. It provides an updated criticality analysis, and I'll talk about that. It sets forth several case studies, including on oil refining. It discusses critical materials, market dynamics, and it presents our R&D plan. And here are our main messages, our main results. First, critical supply challenges for five rare earths may affect energy technologies in the years ahead, and dysprosium, neodymium, terbium, europium, and yttrium. They are the same five rare earths that we identified last year. Last year, I identified indium in this category, and it became, we think, somewhat less critical in the past year. In the past year, DOE and other stakeholders have scaled up work to address these challenges. I've already talked about what DOE has done. Work has begun to really increase in this area, and that's a good thing for the nation, I believe. Here's a critical point. Building workforce capabilities through education and training will help realize opportunities. I'll come back to this, but one of the things that we have found in our work in this area is that it's not just mines, M-I-N-E-S, but it's also mines, M-I-N-D-S, that matters in this area. Having the human capital and human capability in rare earth metals and in materials processing is extremely important for our nation. And much more work is required in the years ahead. So let me talk about our supply, demand, and criticality analysis. A lot of numbers here. Here's what this really is. This chart, with all the mines that are opening up, we did a very detailed analysis, collecting the best information that we could, and put it into a chart looking at the different elements in each mine and the time that they were expected to come online. So we did a rather detailed supply analysis for what's anticipated over the course of the next 10 or 20 years. So there's real limitations in the data set here, but we got the best estimates that we could from mines around the world. That's on the supply side. Then on the demand side, we used the same methodology we did last year, which are four different demand trajectories. And it gets a little complicated to present to an audience. It'll be much simpler when you sit down and read our report, I'm sure. But we looked at two factors, market penetration and material intensity. Market penetration is really simply stated how much of this stuff is out in the marketplace. And material intensity is how much each individual unit uses of the materials we're talking about. And over the course of 10 or 20 years, these are extremely hard to project with accuracy. So we did a number of scenarios. And they are just that they're scenarios, they are not predictions. And we did a high market penetration, high material intensity scenario that's lots of those products out there, lots of stuff being used in each one. For example, trajectory D might be lots and lots and lots of solar panels out there using lots and lots and lots of cadmium or tellurium or other types of elements. And then a high market penetration, low material intensity and then low, high and low, low. And we produced fascinating graphs like this, which I'm sure you can absorb instantly. But here's what they are. This is for neodymium, which is a critical material particularly for the use of magnets. Used for permanent magnets. And the red line on the bottom is the supply today. The dotted red line just above it is when the mountain pass mine opens up its first phase this year. That's the extra supply that will come online. The dotted line just above that is when Mount Weld in Australia comes online. And above that is the estimated 2015 supply reflecting additional mines coming online. And so you'll see in 2015, we estimate ballpark, it looks like 32 or 33,000 tons of neodymium in the marketplace. And then you see the different demand trajectories trending up over the next number of years. And you see the green is the, just the trajectory D at the top is the high, high scenario. So by 2025, we're gonna need significant additional supply. And what that suggests is a lot of pressure to bring on additional supply, a lot of price pressure in the marketplace. If it's a lower scenario, probably less than that. So that's neodymium. Here's lithium, which I thought was useful to look at by way of contrast because it's the same analysis you see in 2015. The estimated supply is the top red line, dotted red line. But much less critical. You see by way of comparison, in 2015, if you look at that line for neodymium, we assess real problems with neodymium supply in 2015, much less in terms of lithium. The world, according to most experts, really has adequate supplies of lithium. This is an issue that's sometime raised in the context of lithium ion batteries, which are gonna be in widespread use in electric vehicles. But lithium supplies are not nearly as big an issue as some other materials. So here's how we summed it all up. We did criticality assessments. This is the methodology that we adopted from the National Academy of Sciences. It's a measure that combines quick clean air inch demands, substitutability limitations, and risk of supply disruption. And we did the timeframe for the short term and the medium term. And then, I already talked about these charts a little bit for last year's report, but here's what we found this year. We found the most critical supply situation to exist with respect to dysprosium, europium, and terbium. Itrim and neodymium also significant issues, and those are five rare earth metals used in permanent magnets and in lighting phosphors. Slightly less near critical issues for some other rare earth metals, and less critical for others. And in the medium term, we did the same type of analysis over 25, 15 to 20, 25 timeframe. Here's a graph that shows, a little bit hard to absorb, but it shows the change between 2010 and 2011 between our analysis, last year analysis, this year, and what it shows, I mean, I think one sum is the summary statement here is the critical, the elements that were critical last year, the elements that were critical last year, we assess this critical again this year. There's been some movement. Indium, probably less critical, and gallium has some movement as well, but some movement, but roughly the same. So let me talk about, and I know it's hard to absorb these things in a presentation like this, but I should emphasize that our report is posted on the Department of Energy website and welcome everybody to go take a look and review it and work through the tables to the extent that you're interested. So we did three technology case studies. One is on fluid catalytic cracking and petroleum refining, a second on permanent magnets, and a third on lighting. And let me talk about each of those and what we found. First on petroleum refining, I've already mentioned that our interest was peaked on this in part because of rising gasoline prices. We knew that rare earth metals play a role in oil and petroleum refining. We wanna take a look at it. So lanthanum, which is a rare earth metal, does play a role in fluid catalytic cracking and it increases the gasoline yields from a barrel of oil. That's the reason that it's used. We found that recent lanthanum price increases have likely added less than one penny to the price of gasoline. That's for a couple of reasons. Partly lanthanum supplies are less tight than for some other rare earth. So I'm gonna talk about some of the price increases in a while, but and then fluid catalytic cracking manufacturers have also been developing substitutes essentially that have improved performance. So there's been movement on substitutes in this area. And then another point that was relevant here we found from talking to the refiners is that lower gasoline yields, if they have lower gasoline yields as a result of using lanthanum, that can mean more production of other products, other distillates and offsetting some of the lost gasoline revenues. So all in all, our conclusion here based upon consultations with industry groups and other experts is that rare earths play an important role in petroleum refining, but the sector's vulnerability to rare earth supply disruptions is limited, not zero, but it's limited. A second case study was magnets in magnets. And here we found just in some ways just as with petroleum refining where the catalyst manufacturers are developing substitutes. There's move towards development of substitutes here as well. We've got two charts here. One of them is alternatives to rare earth motors in electric vehicles. And there's motors like the one on top an induction motor there or a switch reluctance motor are both technologies that do not use rare earth metals and which are used less. And there's a lot of attention looking at how to move away from the use of magnets in motors. And here's a research program on the right funded by ARPA-E to look at dysprosium-free permanent magnet wind turbines. Dysprosium is used in particular for thermal management in the magnets and we have research underway in this. So there's real move towards finding substitutes in this sector, very encouraging. And then we look at lighting phosphors. This is an interesting area. Many countries are moving to energy-efficient lighting, increasing demand for phosphors that have with heavy rare earths, terropium, terbium, yttrium, or the key here. We found that supply of these elements is tight and additional supply is limited in the short term. The graph on the left there is from the International Energy Agency and shows increasing demand for this worldwide as a result of the world's move towards more efficient lighting. US lighting standards will likely increase demand for rare earth phosphors. There's actually two sets of lighting standards. One of which is from the 2007 Energy Act and that applies to general service bulbs. A second set of lighting standards is actually from an older statute and that applies to linear fluorescent lights. Both of those are coming in effect and they're gonna increase the efficiency of US lighting stock and save Americans money and energy costs, but they are gonna increase the demand for rare earth phosphors. And then, and this is discussed in more detail in our report, but LED market share is expected to grow which will reduce pressure on rarer supplies. There's a number of different types of lighting technologies out there for those who aren't familiar with them. The ones that we use today, they're called incandescent. Really, it's a technology that dates back to essentially it's a technology that Thomas Edison discovered in 1879. It's still in widespread use in a lot of places. It's the most inefficient. The first transition stage is to compact fluorescent bulbs which people are familiar with. They're kind of squiggly bulbs. And those are the ones that use the most rare earth phosphors with current technology. The next step beyond that are called LED lights. And LED lights use very little or no rare earth phosphors. Today, they're more expensive, but the prices are coming down. And as the market transitions to LED lights over the course of the next years ahead, there will be reduced demand for rare earth. So what we really see is a shorter-term issue for these heavy rare earths used in lighting over the course of the next couple of years. There we go. So we have a section of this report which talks about market dynamics because we got a lot of expressions of interest in that when we released last year's report with questions about the market dynamics in this area. And we asked questions about this in our public request for information and summarized some of this in our report. We hope it's useful to experts in this area and to the public at large. I just pulled out a few points of this that I thought might be of interest to those who are working in this area that we talked about in the report. And all this is in more detail there. First interest, this is a demand graph. And on the y-axis, you see it's global production relative to 1980. So 200 represents two times 1980 production, 400 represents four times 1980 production. And then you see the years coming out. And what this graph shows is that the increase in demand for the specialty metals that we're talking about has been very significant over the course of the past 30 years. Much more significant than the growth of iron and steel and some other base metals. And that in part relates to the use of these in electronics and other technologies, flat screen TVs and a variety of other consumer technologies that use these type of specialty metals as well as in the clean energy technologies that we're talking about in our report. Partly as a result of this, there have been significant price increases, including actually a fair amount of volatility. So these are, it looks like all rare earth metals. And this is a price chart on the y-axis. You see US dollars per kilogram. And the x-axis there is time. You see a price spike in the 2006 to 2008 period coming down into fall of 2008 with the financial crisis. And then trending back up very significantly in the past year. In fact, the price increases for some of these rare earths over the course of the past year have been dramatic. 10 and 20 x increase. Here's neodymium oxide, which is a, looks like at least a 10x price increase over the course of two years. So tremendous price volatility with some of these rare earth metals. And by the way, you see that neodymium prices are coming down from their peak. There's experts have different views as to why exactly, but certainly there's been moved towards developing substitutes and that could, there's more production coming online, but they've come down from their peak. We talk a lot about rare earth market carriers. I think I'm gonna skip over this slide. Just cause we're running short on time, but we talk about different characteristics of the rare earth market, which I commend you in the report. We also, we have a section that summarizes government policies around the world or the policies of some leading governments around the world, Japan, the European Union, Australia, Canada and China. They're really, this issue is receiving lots of attention in governments at high levels among technical ministries and otherwise. We've done a number of workshops with our counterparts that I said earlier with the Japanese, with the European Union, with the Australians and others. And we have a section which we hope is a good resource, summarized in those policies. And one of the things we've found is, we believe is that cooperation among countries can help to advance mutual goals. We can accelerate global innovation on key topics, improve transparency in critical materials markets and advance environmentally sound mining and processing. As I said earlier, one of the things we've found is that there is a shortage of trained personnel in the United States in this area. And rare earth and mineral processing and refining and use requires a wide range of different disciplines, concentrations and transdisciplinary skills, skills across different discipline sets. We've found experts saying, we just aren't training enough people in this area, that's gonna be a competitiveness issue for the United States. We need to be doing more in this area. And it really is a range of disciplines. And so one of the things we hope that our report will do is encourage interest in this area, encourage young people working in a broad range of areas to pay attention and encourage researchers to look in this area and funders to put money into research in this area. We're looking at this slide as we were preparing this presentation. And I asked, don't we have a visual to go with this slide? And we said, we don't have any pictures of rare earth professionals. And then somebody said, yeah, but we're rare earth professionals. So we decided to take a picture of our team. So there we are, rare earth professionals. We announced in this plan or we set forth in this plan in our strategy, DOE's first R&D plan in this area. It aligns with our three strategic pillars, diversification of supply, with separation processing and substitutes for magnets, motors, and generators, PV batteries, and phosphors, and then recycling. And we already talked about some parts of our plan which were already launched last year and substitutes for permanent magnets and PVs and batteries. In addition, looking forward, we're looking at opportunities for efficient and environmentally friendly processes for mining, which is really key. New separation processes that could apply to recycling. There's tremendous potential here in recycling, but lots of products that currently use rare earth metals are not designed with recycling in mind. And you need to get in from the beginning to design them for the opportunities for recycling as well as then put in place the supply chains that will allow recycling and a lot of important research in that area. And then substitutes for lighting phosphors, particularly important. A really important initiative is our critical materials energy innovation hub, which we spent time developing and proposing last year in which we're very grateful Congress funded in the appropriations bill in December for $20 million. So an important piece of work going forward is gonna be developing the critical materials hub and the idea we will be launching in the year ahead. We have an innovative manufacturing initiative and small business innovation research, both of which focus in this area as well. And I already talked about recycling, which includes kind of made these points, availability, material, technology, infrastructure. And here's just some opportunities here for compact fluorescent bulbs. 30% of these bulbs are actually already being recycled. For mercury removal, there's trace mercury in these bulbs. But the phosphors that are in these bulbs, the terbium, the European, the atrium end up in landfills. And there's real opportunities if we can figure out the right way to do it to extract some of the rare earth metals from these bulbs. So they don't end up in landfills since they're in such short supply. And particularly in manufacturing, in the manufacturing stage, there's a lot, we're told a fair amount of loss of these materials in the production of magnets and there's a lot of work underway to look at how to reduce the loss in the manufacturing phase as well. So getting to the very end, our next steps, implement our research plan, strengthen information gathering capacity. This, we're gonna continue to work closely with our interagency colleagues, with international partners, Congress and the public on all these issues. And we're doing this to help inform stakeholder community in this area and provide guidance where we particularly wanna be responsive to what stakeholders broadly believe is useful. And update this strategy periodically in the years ahead. So with that, thank you very much for listening and happy to take questions. Sure. Thank you, David. It was a great presentation. So a few ground rules. Many of you are familiar with our ground rules in terms of questions and answers, but it would be helpful if you, please identify who you're with, more than helpful. Yes, please identify who you're with when you're asking your question. If you can also make it in the form of a question rather than necessarily an intervention, I think that we can carry on dialogues at other times and then also wait for the microphones to coming because we are webcasting this presentation. So we wanna make sure we capture your questions. But I thought I would go ahead and start with one that's of particular interest to me given my background in the international side, that you're mentioning the international cooperation you're having with the Japanese and the Europeans, but I was wondering how does this factor into the clean energy collaboration with China? Because that's been such an important part of the activities you have underway, but yet the Chinese are in many ways really, everyone's pointing their finger at them on this topic, but yet it's, how do you handle that in the clean energy collaboration? So far we haven't had discussions on this specific topic in the course of some of those clean energy dialogues that you've been talking about. The issue of rare earth metals in particular with China has been contentious over the course of the past, over the course of the past year. China as many people here will know has export restraints in this area. They've actually reduced the amount of exports that are allowed pretty steadily over the course of the past couple of years. That's been a significant cause of concern to the US government, to other governments around the world. Those trade issues are not the Department of Energy's main responsibility. Our colleagues in the interagency arena, the USTR in particular and the Department of Commerce have really been in the lead on those issues and they've raised them in the JCCT which is a forum with China on trade issues in a pretty high profile way, actually as is Secretary Clinton in some of her dialogues. Our strategy is really not focused on the trade issues as per say, but is focused on how we respond to the evolving situation here, diversifying global supply chains so that no one country controls the export or the supply of any of these elements, developing substitutes and reducing use so that we're not dependent on. Thanks. Okay. We can start here, Jim. Jim Bartis. One, just stand up, stand up. Mike's there, okay now I get it. Jim Bartis with Rand. To what extent is your strategy of concern about US manufacturing? Because we import these materials as finished products and to what extent would China be willing to, if it had its way, sell us all the wind turbines, sell us all the solar photovoltaic devices. And if that's the case and if it's about manufacturing, then why aren't we looking at other important critical materials such as tungsten, which is used for cutting tools? We can't manufacture if we don't have cutting tools and tungsten is controlled by China also. Yeah. Thank you for the very, very good question. The answer is yes, this has a lot to do with US manufacturing. And at the end, I noted one particular manufacturing initiative that DOE has underway in which we're looking at this issue in particular. But American economic growth, I believe, has as its core growth in the manufacturing sector and these materials are important in a number of different manufacturing applications. One of the reasons that we're doing this report is to promote American competitiveness in these areas. A second part of your question had to do with tungsten and make a broad point on this. I'm not familiar with the particular dynamics around tungsten, maybe some of our experts are. But one of the things we did in our 2010 report was ask broadly to the public what elements that we haven't addressed yet, would you like us to look at? And that's why we added nickel and manganese to the report. We're open to additional kind of areas of interest. We obviously have resource limitations of what we can look at, but very interested if tungsten or other elements that are particularly interested to the public to look at it further. Thank you, I'm Margaret Ryan with AOL Energy. I wonder, you mentioned substitutability and research that's proceeding on that. That seems to me a very key element if you can substitute something plentiful for something rare. Have there been any specific breakthroughs or are there any that things you can point to where there's been success in this area? No, broadly if I should say to my team here, if I get really hard questions, I'm gonna ask you if you have any ideas. I don't have any breakthroughs to point to but I hope we're gonna see them in the years ahead. I think with concentrated attention, with funding and with initiatives like the Department of Energy's Critical Materials Hub, I hope we're gonna see real breakthroughs in this area. I know that there is a lot of interest in some of the substitutes for dysprosium, for example, in permanent magnets, real hope there, hopes in motors and moving to switch reluctance motors and other types of technologies but I think there's real opportunities but it's going to take sustained concentration, it's gonna take sustained funding and it's gonna take developing the human capital as I talked about in my talk. Diane, are there's anything you wanna add to that? All right, Mitzi. I'm Mitzi Wertheim with the Naval Postgraduate School. I wanna ask about the human capital because I remember when Sputnik went up, there was this enormous thrust to get people into engineering. I mean, it really changed the game and what I'm struck by is we haven't found a way to have a narrative that changes the game on this. I mean, clearly interdisciplinary education in colleges and universities needs to be a component of this but very few of them do it. The newer schools do it. Arizona State University does it but most of them are stovepipe so they come out and they don't have these integrating capabilities and so I guess my question is how do we create the narrative so we get the response from the public wanting to go into chemistry and engineering and all of these really tough, hard sciences? It's a great question, Mitzi. Thank you very much for it and just, I mean, two thoughts. First, I hope that this report helps to lay the foundation for a narrative of the type you're talking about. It's probably too technical to be a kind of narrative in the sense you're talking about this but I hope it helps to lay the foundation for that. Second, as you were talking, I was thinking of my boss who, for whom, Secretary Chu, for whom this is a passion, the issues you're talking about, getting talented young people into engineering and science and I think the President's appointment of Secretary Chu reflects the President's commitment along these lines as well. I mean, we have, I wasn't at the Department of Energy back when Dave was on, I know you had a number of extraordinary secretaries and not to sell, who you work for, not to sell any of them short. It's very, very talented people but having a Nobel Prize winner running the U.S. Department of Energy I think is really, it's inspirational and I sometimes sit in these budget meetings and feel sorry for the people who've been cross-examined by a Nobel Prize winner who knows more about their area of expertise than they do and it really is, I think, part of a broader effort to really raise the profile of science and technology in our country that the President has launched. I'm gonna stand up here to see about the questions on this side. There's one in the back. Were there any over? Okay, and then we'll follow along to the other. Then here. What if you wait just for a second? I remember in my own background as a chemist, my first professional job was with a DuPont company with a Ph.D. It was assumed that I didn't know much and that I would learn a lot about the business over the first couple of years. Right now, the unemployment rate among chemists is about the highest it's been in decades. There are a lot of scientists, trained scientists around the country who are either unemployed or underemployed and yet when we have these kinds of discussions it always focuses on how do we attract more people into the universities. Do you have any programs for recreading scientists that are looking for work? It's a great question and I'm not a chemist, but one of the comments that I've heard a lot in working on this issue is that we have a number of actinide chemists in our country whose expertise would be particularly applicable for lanthanide chemistry and because of similarities between actinide and lanthanides. And I hope that initiatives like the Critical Materials Hub that DOE is now funded to launch and the other programs that I was discussing will one provide opportunities for chemists and at all levels, including the ones that you were just asking about and to encourage others to fund in this area as well. That's the hope. But very open to ideas in this area. It's really, I just want to emphasize again, this is one of the areas that we've identified as particularly critical within the limits of a difficult federal budget situation overall. We're trying to provide the resources to help encourage work in this area and we're very open to ideas or suggestions about how we provide the exact type of opportunities you're talking about. George Handy, Activity for Innovation and Economic Growth. I wonder if you would comment on your plans for joint research with other countries, particularly areas that you think would be a priority for international collaboration and any countries that you're particularly looking at for collaboration. Thank you for the question. And it's a very important one. There has been enormous interest in this issue from our partners in Japan, I'd say in particular at the top of the list, the European Union equally very strongly in and Australia as well. And we've had a number of workshops over the course of the past year with those countries focusing on actually the range of technologies that I just spoke about. I think certainly with Japan, magna production is in permanent magna production extremely important in finding substitutes for railways in that area has been a real priority. In Europe, Europe has very strong lighting standards, energy efficient lighting standards. And so shortages there are particularly important so finding ways of moving towards substitutes in that area is particularly important for the Europeans. Part of the effort here is, I guess you called situational awareness, I mean understanding what different research is happening in different countries is helpful in terms of avoiding duplication. Sometimes this actually leads to researchers getting together in the lab and producing joint innovations. But this type, getting global scientists together to understand what each other is doing is extremely important. And governments can play a helpful role, I think of providing a platform for that right here. Hi, I'm Barb Karn from NSF. And I was curious in the changes in criticality from last year to this year. And I was wondering if that's because you got new knowledge about supplies or if indeed there were some substitutions in the products? I think it's, to some extent, both. And I might, Diane, you want to elaborate on this? So in terms of, for example, neodymium in particular, I think that that change was a result of substitution, that sort of notch down in supply risk. In terms of the indium and gallium shift down in importance to clean energy, that was a result of sort of a revision of our outlook for SIGs in PV. The shift upwards in importance to clean energy for yttrium, europium, and terbium was due to sort of a growing recognition of the various transitions to energy-efficient lighting globally, how that could sort of lead to an increase in demand as the supplies are tight in the short term. Does that answer your question? Okay, please go to our report, last more in the report. So we're getting close to the time that David has to go back and actually get engaged in the day-to-day, so I think it's time for one more question so if we can see right there where the microphone is, that's good. Hi, Lauren Gardner from Congressional Quarterly. It seems that the executive branch has taken a lot of the initiative with trying to study this area and there have been some piecemeal directives from Congress, but nothing comprehensive. What in particular do you think you need from coming out of Congress to further resources concentrating on this particular issue? Yeah, thank you for the question. I've testified on this issue several times in 2010 or 2011. There's really substantial interest in this issue on Capitol Hill and I make this observation as we start an election year and my observation from testifying is this is an issue that has a lot of bipartisan agreement. It's not complete, it never is, but I think in this area, members of Congress agree on much more than they disagree. There's numbers a piece of legislation and there's many of them have lots of similarities, they have lots of bipartisan support. We have considerable authorities in this area. The appropriations that we received are especially important to be able to support the work in this area and we're very grateful for those appropriations. So continued support in that area would be particularly useful but I think this is an area where I think people from different parts of the ideological spectrum can really come together and work together towards results that are better for our country. Well, David, thank you very much for joining us. It was a great presentation and really appreciate you taking the time. So please join me in thanking David for his presentation. Thank you. Thank you. Very good. Have a good chat.