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The US Department of Energy is giving $120m (£75m) to set up a new research centre charged with developing new methods of rare earth production.

Rare earths are 17 chemically similar elements crucial to making many hi-tech products, such as phones and PCs. The Critical Materials Institute will be located in Ames, Iowa.

The US wants to reduce its dependency on China, which produces more than 95% of the world’s rare earth elements, and address local shortages. According to the US Geological Survey, there may be deposits of rare earths in 14 US states. Besides being used for hi-tech gadgets, the elements are also crucial for manufacturing low-carbon resources such as wind turbines, solar panels and electric cars, said David Danielson, the US assistant secretary for renewable energy.

Rare earth elements are also used for military applications, such as advanced optics technologies, radar and radiation detection equipment, and advanced communications systems, according to a 2011 research report by the US Government Accountability Office. From the 1960s until the 1980s, the Mountain Pass mine in California made the US the world leader in rare earth production, but it was later closed, largely due to competition with the elements imported from China.

At the moment, the regulations surrounding rare earths mining in the US are very strict, an expert on the materials from Chalmers University of Technology in Sweden told the BBC. “The Mountain Pass mine was [also] closed down for environmental reasons,” said Prof Ekberg.