The U.S. Department of Energy is intensifying efforts to secure critical minerals as global supply risks rise. In a new collaboration, the DOE’s Ames National Laboratory and the Critical Materials Innovation Hub have joined hands with Amazon to recover high-value materials from waste.
The partnership focuses on extracting battery-grade graphite and key minerals from discarded textiles and electronic waste. This move reflects a broader U.S. strategy—reduce import dependence, build domestic capacity, and create a circular supply chain for critical materials.
Assistant Secretary of Energy (EERE) Audrey Robertson, leading DOE’s Office of Critical Materials and Energy Innovation, said:
“At scale, the recovery of critical minerals from end-of-life technologies and textile waste has the potential to transform our domestic critical materials supply chains. This pioneering work, made possible by an exciting new partnership with Amazon, supports the Trump Administration’s efforts to reduce our reliance on foreign imports and strengthen our national security.”
U.S. Aims for Domestic Graphite Supply
The collaboration combines materials science with artificial intelligence. Ames Lab and CMI bring decades of expertise in metals refining and advanced materials. Amazon contributes AI, logistics, and large-scale supply chain capabilities.
Ames Laboratory Director Karl Mueller also noted,
“This is an excellent match for Ames National Laboratory’s deep expertise in materials science. For decades, Ames Lab has led the nation in metals refining, purification, and critical materials research—and applying that strength to real-world challenges.”
Turning Textiles into Battery-Grade Graphite
A major project aims to convert discarded textiles into battery-grade graphite. This is significant because graphite is essential for lithium-ion batteries used in electric vehicles (EVs) and energy storage systems.
Today, the U.S. remains heavily dependent on imports for graphite. In fact, more than 90% of global battery-grade graphite processing is concentrated in China, creating a major supply risk.
- As of 2024, the U.S. imported about 60,000 metric tons of natural graphite, down from roughly 84,000 tons in 2023.
- China remained the largest supplier, accounting for around 67.6% of all natural graphite imports by value.
This is worth roughly $375 million. It represents a slight decrease in volume but still a dominant share of the market.
By extracting graphite from waste, the U.S. can reduce both landfill pressure and foreign dependence. This approach aligns with the DOE’s push to secure materials from “secondary sources” such as waste streams.
AWS Powers AI-Driven Mineral Recovery
A second initiative focuses on recovering minerals like gallium from end-of-life IT hardware. Gallium is a critical input for semiconductors, power electronics, and defense technologies.
The importance of this effort is clear. In recent years, China has restricted exports of gallium and germanium, disrupting global supply. These restrictions effectively removed up to 90% of global gallium supply from international markets, exposing major vulnerabilities.
Here, Amazon Web Services will deploy AI tools to map supply chains, identify recovery opportunities, and assess economic feasibility. At the same time, CMI researchers will develop efficient extraction and refining methods.
This fusion of AI and materials science could transform recycling. Instead of being discarded, old electronics could become a reliable domestic source of critical minerals.
A Fragile Supply Chain: Why the U.S. Is Acting Now
Critical minerals are the core of modern industries—from EVs and renewable energy to semiconductors and defense systems. However, U.S. supply chains remain highly vulnerable.
According to recent industry analysis:
- The U.S. is 100% import-reliant for at least 13 critical minerals
- Over 20 additional minerals have an import dependence above 50%
- The country exports much of its raw materials for processing overseas due to limited domestic capacity
China dominates refining and processing, backed by decades of industrial policy. This concentration creates risks of supply disruptions, price spikes, and geopolitical leverage.
To address this, the U.S. government is mobilizing large-scale investments. In 2025, the DOE announced nearly $1 billion in funding to strengthen domestic critical mineral supply chains, with a strong focus on battery materials processing and recycling.
Additionally, new initiatives such as strategic stockpiles and international partnerships are being developed to secure long-term supply.
CMI Hub Leads the Shift to Circular Supply Chains
The Amazon–DOE partnership reflects a major shift in strategy. Traditionally, supply security depended on mining new resources. Now, recycling and “urban mining” are becoming equally important.
The CMI Hub is leading this transition through research in:
- Expanding material supply sources
- Developing substitutes for scarce minerals
- Recovering materials from waste
- Accelerating the commercialization of new technologies
Recycling offers several advantages. It is faster to deploy than mining, less environmentally damaging, and often more cost-effective in the long run. For example, the U.S. has already committed funding to advanced graphite recycling projects to build domestic battery supply chains.
CMI Hub Director Tom Lograsso
“This collaboration is a natural extension of the expertise that CMI Hub was created to deliver. CMI’s mission is to move breakthrough materials technologies from the laboratory into real-world applications on timelines that meet industry’s needs. Working with Amazon gives us the opportunity to apply our capabilities at scale—combining CMI’s materials science expertise with Amazon’s AI to turn innovations into practical solutions that strengthen the nation’s critical materials supply chains.”
Public–Private Partnerships Drive Scale
This collaboration also highlights a broader trend—closer ties between government research institutions and private companies.
Amazon brings AI, data analytics, and global logistics. Ames Lab and CMI contribute scientific expertise and research infrastructure. Together, they aim to move solutions from the lab to real-world deployment at scale.
Such partnerships are critical because the challenge is not just technical. It also involves economics, infrastructure, and supply chain coordination. By combining strengths, these collaborations can accelerate innovation and reduce risks.
Conclusion: A Strategic Shift With Global Impact
The U.S. is clearly redefining its critical minerals strategy. Instead of relying only on mining, it is tapping into waste as a new resource base.
This approach offers strong advantages:
- Waste streams are abundant and underutilized
- Recycling reduces environmental impact
- Domestic recovery improves supply security
However, challenges remain. Domestic processing capacity is still limited, and scaling recycling technologies will require sustained investment and policy support.
At the same time, AI is emerging as a key enabler. It can optimize recovery processes, improve efficiency, and reduce costs. As adoption grows, it could become a critical tool in securing mineral supply chains.
And the partnership between the DOE, Ames Lab, CMI, and Amazon marks a turning point in how the U.S. approaches critical minerals.
- READ MORE: DOE Launches $500M Funding Drive to Strengthen U.S. Battery Supply Chains and Critical Minerals Processing
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More and more small and medium-sized businesses are hearing the same question from their larger customers: What is your carbon footprint? That question now travels down entire supply chains, and it arrives next to tender requirements, certification criteria, and rising customer expectations.
The accounting differences that decide whether your nature investment shows up in inventory, in BVCM, or nowhere at all.
The question reaches a procurement team about three weeks before the next sustainability committee meeting. Someone has read about insetting. Someone else has just signed off on an offset purchase. The CSO wants to know if the two are interchangeable. The answer is no, and the GHG Protocol Land Sector and Removals Standard is the reason why.
This article walks through what each term means at audit-grade specificity, what the standards actually say about how each gets counted, and how to decide which tool fits which target. The insetting vs offsetting question is one of the most-searched in corporate climate strategy, and one of the most poorly answered. By the end of this piece, you should be able to brief a committee on the difference without notes.
The two definitions, in plain English
Offsetting means buying carbon credits generated outside your value chain and retiring them against your residual emissions. The reduction happens somewhere else, financed by you, and the credit is the receipt.
Insetting means investing in emission reductions or removals inside your own value chain, typically with suppliers, where the reduction is directly linked to the products and services you buy. The reduction happens inside the boundary of your Scope 3 inventory, and the accounting treatment is fundamentally different.
The shorthand from the University of Oxford’s Nature-based Insetting Initiative is useful: insetting is what you do with the supply chain you have; offsetting is what you do with the supply chain you do not have.
What the GHG Protocol Land Sector Standard actually says
The GHG Protocol Land Sector and Removals Standard, finalised in 2024 after a multi-year pilot, sets the rules for how land-based emission reductions and removals enter corporate inventories. The Standard distinguishes between inventory accounting (Scope 1, 2, and 3) and project or intervention accounting (a separate methodology for crediting).
For insetting, the practical implication is that supplier-level interventions, when properly measured and attributed, can reduce your Scope 3 category 1 (purchased goods and services) emissions in your inventory. The reduction is not a credit retired against the inventory; it is a lower inventory number, period.
For offsetting, the credit is retired separately. It can be reported as a contribution toward a net-zero claim under the SBTi Beyond Value Chain Mitigation framework or as part of a VCMI Carbon Integrity claim, but it does not lower the inventory number.
A practical consequence: if your Science Based Target requires a 50% absolute reduction in Scope 3 emissions by 2030, insetting moves you toward the target. Offsetting does not. This single point of difference reshapes the procurement decision.
When insetting counts toward Scope 3 (and when it does not)
Insetting counts toward Scope 3 only when several conditions are met:
- The intervention must occur with an entity in your value chain.
- The emissions reduction or removal must be measured against a defensible baseline.
- The reduction must be attributed to your share of that supplier’s output, not double-counted with other buyers.
- It must follow the inventory accounting rules in the GHG Protocol Land Sector Standard, not the project accounting rules used to generate credits.
The most common failure mode is double counting. If your supplier sells the same reduction as a credit on the voluntary market and also reports it to you as a Scope 3 reduction, the math breaks. The Standard requires you to address this risk, typically by purchasing and retiring the supplier-issued credit as part of your inventory or by contractual provisions that prevent the supplier from selling the reduction twice.
When insetting does not count toward Scope 3: when the intervention sits with a supplier you do not buy from, when the baseline is not defensible, when the attribution is unclear, or when the documentation does not survive audit. Those cases default to Beyond Value Chain Mitigation, which is still useful but operates on a different ledger.
The procurement and supplier engagement question
Insetting is harder than offsetting. That is the unfashionable truth most buyers eventually confront. Offsetting is a transaction; insetting is a relationship.
To run an insetting program, you need supplier mapping precise enough to know which farms or facilities sit at which Scope 3 boundary. You need an engagement model that gets suppliers to participate, which usually requires multi-year commitments and shared economics. You need an MRV architecture that measures the right things and produces audit-ready documentation. And you need a contractual structure that prevents double counting and protects both sides.
The trade-off you receive in return is significant. Reductions count against your inventory rather than your residual. Supplier relationships deepen, which protects sourcing continuity. Yield and quality improvements often follow regenerative interventions, which reduces your input cost over time. And the regulatory file, under CSRD, CSDDD, EUDR, and the SBTi FLAG Guidance, is materially stronger.
Choosing the right tool for the right target
A practical decision rule. If your target is a science-based Scope 3 reduction and you operate in a FLAG sector or source FLAG commodities, insetting is the structurally correct tool. If your target is a net-zero claim that includes neutralising hard-to-abate residual emissions outside your value chain, BVCM via high-integrity offsets is the structurally correct tool. Most companies with material Scope 3 exposure need both, in different proportions, sequenced over time.
The sequencing matters. Insetting takes longer to stand up but produces a permanent reduction in the inventory. Offsetting can be transacted faster but does not change the inventory and now sits under tighter claim restrictions. Treat them as complementary tools with different jobs, not as substitutes. The Accountability Framework Initiative and the IUCN Global Standard for Nature-based Solutions both provide useful guardrails for the insetting side, with biodiversity, human rights, and benefit-sharing requirements that go beyond carbon math.
If you are mapping a Scope 3 reduction roadmap and need to scope which interventions count toward your inventory versus which sit in Beyond Value Chain Mitigation, the carbon and sustainability experts at Carbon Credit Capital can help you structure a nature-based supply chain investment program that fits your FLAG exposure, your target architecture, and your audit horizon. Schedule a consultation.
Net zero is often described as a balancing act: cut what you can, account for the rest, and reach zero on the ledger. That framing is useful, but it leaves something out. It treats every tonne of carbon as interchangeable and every route to zero as equally sound, while the science tells a more specific story.
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