Highlights

• Rep. Meuser introducing federal tax incentive legislation to jumpstart U.S. rare earth extraction from coal ash, oilfield brine, and wastewater
• Proposed tax credits range from $3-$20 per unit for rare earth materials extracted from unconventional sources
• Legislation aims to counter China's control of global rare earth supplies and support domestic critical minerals independence

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In a direct response to China's tightening grip on global rare earth supplies, Rep. Dan Meuser (R-PA (opens in a new tab)) is preparing to introduce sweeping federal tax incentive legislation aimed at jumpstarting domestic rare earth production from U.S. waste streams. The bill—set for release next week—would target critical materials recovered from coal ash, oilfield brine, and wastewater, with the goal of accelerating rare earth independence.

At a House Small Business Committee hearing on Tuesday, Meuser previewed the bill’s provisions:

• $9 per ton of coal ash containing rare earths
• $20 per kilogram of rare earths extracted from coal
• $3 per barrel of rare-earth-bearing brine water
• $20 per kilogram for lithium and rare earths extracted from brine

Meuser is also co-sponsoring the Rare Earth Magnet Security Act of 2025 (H.R. 1496), (opens in a new tab) which would offer tax credits for domestically manufactured rare earth magnets, a key bottleneck in the supply chain for electric vehicles, wind turbines, and defense systems.

REEx Analysis: A Long-Overdue Market Signal

The move signals a significant shift from talk to action, delivering direct price support to counter China’s predatory pricing and providing U.S. firms with an opportunity to de-risk investment in extraction and processing. It also finally recognizes the vast potential of unconventional sources, particularly coal waste and oil brine, which could bypass traditional permitting delays.

Yet no production mandate or federal procurement guarantee currently backs these credits, meaning capital markets may still hesitate without downstream demand certainty. As always, tax credits without offtake contracts may fall short of industrial impact.

Rare Earth Exchanges™ Bias Meter™

Source	Bias Rating	Justification
POLITICO	Objective Reporting	Clear, timely policy coverage with minimal editorialization.
Meuser’s Framing	Nationalist Economic	Focuses on domestic production without integrating global partnership.

Verdict: Promising. But production needs buyers, not just credits. And America (and its allies need industrial policy)--for deeper analysis, contact: info@rareearthxchanges.com