What's the alternative? If we want to electrify, it means more resource discovery and mining than we're already doing, plus likely mining more non-renewable fuels to power the intermediate infrastructure we will need to mine or recycle metals for renewables or EVs.
Degrowth, using less of everything, only keeping what we truly need instead of producing insane amount of next to useless junk, stop shipping bananas to the other side of the planet to have half of them end up in a trash anyways, &c. Basic common sense stuff that we won't do because we need that sweet sweet "growth" at all cost.
Producing less and electrifying a grid are not mutually exclusive, ideally we will do both. Even in a "degrowth" future, we have to power critical infrastructure, which means large infrastructural changes and a bunch of raw materials.
One use of rare earths is for permanent magnet motors. Induction motors don't use permanent magnets, but they tend to be significantly less efficient.
Permanent magnets can also be made without rare earths, but I expect the result would be a physically larger/heavier and/or less powerful motor. So, it's a trade-off.
What's the alternative? If we want to electrify, it means more resource discovery and mining than we're already doing, plus likely mining more non-renewable fuels to power the intermediate infrastructure we will need to mine or recycle metals for renewables or EVs.