Building the new order Entry 14

You already know that I try to make each entry independent of the previous one, but that I have a common thread: I seek to deduce how the new world order is going to be organized after everything that is happening.

My new context selection.

For some time now, I have been starting all my entries with this “new context” heading in which I summarize what has happened since the previous entry regarding the evolution of the new order. My selection today is as follows:

Germany has problems to continue financing the Ukrainian War, as well as the energy transition. Its Constitutional Court has blocked the possibility of continuing to use funds for this as they have been doing (news here).

In addition, the European Union is also finding it difficult to help Ukraine because of Hungary’s position (news here).

Nor is it easy for the USA to continue supporting Israel in its WAR in Gaza (news here). Although, yes, the USA has voted in the UN against the ceasefire in Gaza (news here). In other words, they are making difficult trade-offs.

The bombing of commercial ships in the Red Sea has caused several shipping lines to avoid passing through the Suez Canal and prefer to turn around to Africa. This increases transport costs and time consumed. In other words, greater problems of supply of products, and higher inflation. Serious matter (news here).

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COP 28- Dubai.

The UN Climate Change Conference has been held in Dubai. It was supposed to end on December 12, but has been extended for another day.

After much discussion, an agreement has been reached on the objectives for the future. An agreement that many criticize as unambitious, and others see as difficult to achieve.

The main discussion centered on a specific paragraph. Some countries wanted it to be stated directly that there is a commitment to end fossil fuel-based energies. Evidently, the oil-producing countries (including the conference organizer) did not readily agree to this commitment. The final agreement is as follows:

“Transitioning away from fossil fuels in energy systems, in a just, orderly and equitable manner, accelerating action in this critical decade, so as to achieve net zero by 2050 in keeping with the science”.

The full text of the final agreement can be viewed here.

What they say in points 67 and 68 of this agreement is indicative of the economic effort required. There, with a very convoluted exposition, and full of nuances, they end up saying that investments of about 5 trillion dollars per year will be needed until the year 2050 in order to reach zero emissions in that year. And these figures are only for developing countries. It is therefore clear that the need for funds is immense.

They have also made calculations of the necessary investments in Mc Kinsey. They estimate them at 275 trillion up to 2050 (news here). In the same report, they acknowledge how difficult it is to make these estimates, and the wide variation in figures for different countries. To get an idea of the size of these figures, it is worth remembering that the total value of all the buildings in the world is estimated at 380 trillion (data here), i.e. a figure of the same order of magnitude.

On the other hand, I was struck by the fact that the Pope of the Catholic Church participated in the conference. He gave a speech (not in person, due to illness), which can be seen here, and from which I highlight the following sentences:

“Climate change shows the need for political change. Let’s get out of the quagmire of particularisms and nationalisms, which are schemes of the past.”

“Let us leave divisions behind and join forces! And, with God’s help, let us emerge from the night of war and environmental devastation to transform the common future into a luminous dawn. Thank you.

It seems that the Catholic Church is joining the drive for this energy change.

My conclusion from all this is that, without being totally clear that it is really necessary, there is a global plan to educate governments and the population that we are on that path (that of eliminating fossil fuels). And, although not all participants have the same objective, the decision has been made. The impact on the economy will be very large, and so will the risks and opportunities.

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Conclusions on scarce raw materials.

After what was said about COP 28, I continue what I have been talking about raw materials for the energy transition.

In this entry I end my humble research, and I end it by saying, at the end of this entry, what I believe the West must do to reach the goal of energy model change,

As I have already said, I am looking for the countries that would be necessary to “sign” for the Western bloc with the aim of making that bloc self-sufficient in raw materials for the energy transition to renewable energies.

I have already looked at electric cars (entry 8), solar photovoltaics (entry 9), and geothermal energy (entry 13).

Also, I warned in entry 10 that I had come across a study carried out by IMDEA (news here) in which they address the same issue. They do so in terms of identifying the scarce materials in the world for this energy transition, not in terms of their countries of origin and their block of ascription. I also said that I have great confidence in this Institute because I know its high technical quality.

So, that saves me work, and it saves you readers time.

The conclusion of the study is that the globally scarce raw materials to make the energy transition are: zinc, nickel, lithium, cobalt, silicon and vanadium (glad to know that I had already identified most of them in my previous entries).

I will now discuss these raw materials from the point of view of their specific usefulness, as well as the countries that the West should “sign up” in order to solve the supply problem.

Zinc.

The main use of zinc in renewable energies is to “galvanize” steels. That is, to make them more durable against corrosion.

This is done in the support structures of the solar panels (e.g.), which means that it is very useful, but not essential, since other types of supports could be considered.

Zinc is also used in some types of batteries, which is more “inherent” to energy production.

According to Statista (here), total world zinc reserves are estimated at about 210 million metric tons. Due to the high consumption of this metal, zinc reserves are expected to last only for the next 16 years. This means that it is time to start thinking about other types of support for solar panels (not so difficult).

Statista also tells us in that link that Australia is by far the country with the largest reserves, followed by China and Russia.

In view of the graph, it can be summarized that reserves are more or less evenly distributed among the foreseeable blocks of countries.

Of course, although it can be assumed that Australia belongs to the Western bloc, it should be noted that the agreements currently signed give much control of Australian zinc to Chinese companies, as can be seen in this news item.

Nickel.

I discussed nickel in entry 8, where I dealt with the issue of electric car batteries. The summary was that there is not as much as is needed. But there is not too little for the first few years, and there is technology to replace it later. So it should not be of too much concern.

Currently known reserves are primarily in Indonesia, Australia and Brazil, and to a lesser extent in other countries in the BRICS+ orbit, as can be seen here.

Therefore, the West must keep a close eye on its agreements with Australia, as well as improve the technology to replace nickel in batteries. I see little chance of “signing up” other countries with reserves.

Lithium.

I also talked about lithium in entry 8. There it was stated that its main use is for electric car batteries, as well as the fact that world reserves are more or less distributed among the blocks of countries that are being formed.

Therefore, lithium is not a problem in this respect. However, it is worth remembering that Argentina is one of the major producers, and it seems that it has just “signed up” for the West after Milei’s victory. In addition, Australia is the largest producer and seems to be in the same block.

Cobalt.

I also discussed cobalt in entry 8. It is another material for electric car batteries.

The summary was that there is clearly no cobalt in the world to make all the electric cars with these batteries. Moreover, reserves are concentrated in the Democratic Republic of Congo, which is considered a partner of the BRICS+ bloc.

It was also clear that there is technology to make batteries without cobalt. I cited the example that Tesla is moving to lithium-iron-phosphate ones, replacing nickel and cobalt.

Therefore, with respect to cobalt, the best thing for the West to do is to forget about it.

Silicon.

I discussed silicon in entry 9, because of its importance in the production of photovoltaic cells.

The result is that there is no shortage of silicon, but of the facilities to transform it into crystalline silicon, usable for solar panels. There are also no supply problems in the blocks of countries.

Therefore, with respect to silicon, the problem is one of investment in order to have large-scale operational industries.

Vanadium.

Finally, among the materials cited by IMDEA, the one I had not yet identified was vanadium.

The use of vanadium in renewable energies is focused on large batteries (they are called vanadium redox batteries). They have many advantages for their use, but one big disadvantage: they are very large and heavy. Therefore, they cannot be used in cars.

However, there is one very promising use for these batteries. It is about energy storage at the production site. The energy to be stored from the time it is produced (in wind farms, photovoltaic, geothermal, …) until it is required for use. They explain it well here.

According to Google, world vanadium ore reserves amount to 16.6 million tons of contained metal, which are distributed as follows:

South Africa (47.1 per 100)
Soviet Union (24.6 percent)
United States (13.1 per 100)
China (9.9 per 100)
And, other market economy countries (5.3 percent).

This distribution of countries is not the most convenient for the West. At best, it is possible to try to make a deal with China and its partners.

The good news is that there is a lot of vanadium in industrial landfills, because it is found in small proportions in many things. In other words, recycling can be a great source of vanadium for the West. We should invest in that industry.

ETC Report.

The Energy Transitions Commission (ETC) has published this report for those who want to learn more about all this. The following graph is worth extracting from it.

A clear conclusion from looking at the graph is the great effort needed to multiply the existing infrastructures in 2022 to reach the 2050 targets. For example, solar energy installations would have to be multiplied by 25 times, and battery installations for electric vehicles by 60 times.

As for the mining associated with these changes, we conclude that new mines have to be created in these orders of magnitude. Perhaps even larger, since these materials are very poorly concentrated in the usual rocks, which means that many cubic meters of rock have to be mined to extract a few kilos of the sought-after material.

In addition, we have to be very conscious that this mining issue is fundamental to achieve the goal of energy change. Without new mines there is not enough new renewable energy. In fact, … the speed of the energy transition is going to be determined by the speed of being able to open new mines. And, let’s remember that mines are not very well regarded in the West under the “environmental” criteria, nor do they have easy and quick administrative procedures for opening. If we want energy independence at the West, we have to open many new mines very quickly, and accept their environmental problems (new paradox).

Summary of the situation.

After all that has been said about renewable energies, the West must be clear that it is a nice attempt, but that it will not be able to achieve the total energy supply with them in a quick and “continuous” way (except in the case that the deep geotechnical project mentioned in entry 13 works at reasonable costs). However, it is good to try to do as much as possible, mixing different technologies.

It is also clear that it will not be possible to abandon fossil fuels completely in the short term. This implies that some of the major oil or gas producing countries will have to “sign up” for the West.

Moreover, given the foreseeable energy shortages, it is very important to insist that the cheapest and most accessible energy is the one that does not need to be used. We must remember that we have plenty of technology to make things much more efficient than they are today in terms of energy consumption. And that we can invest in further improvements along these lines. A clear example of what I say is the huge number of existing buildings with poor thermal insulation, which leads them to consume more energy in air conditioning. Another example would be the stupid habit we have of using large cars (weighing more than 1,500 kgs) to regularly move a single person weighing less than 100 kgs, which means unnecessary fuel consumption (which depends on the kgs. mobilized).

We should also bear in mind that, in the transition to renewable energies, we should not forget about “old” nuclear energy (fission one), since it does not create CO2 problems (although it has other types of problems). Moreover, there are already many existing infrastructures. It is logical to take advantage of them until the desired change is achieved. Perhaps, even to increase them a little.

Actions needed in the West.

Given what has been discussed in these entries, I believe these are concrete tasks for the West in its quest for future energy autonomy:

Ensure Australia’s continuity in its bloc of countries. And help it cut its current contracts with China. This is because of its zinc mines (needed for solar panels), and nickel (needed for electric car batteries).

As for electric cars, avoid batteries that need cobalt. And, if the West is not able to do so, it has to get an unlikely agreement with the Democratic Republic of Congo.

Also in relation to electric cars, batteries that do not use nickel should be encouraged, since there is not enough of it.

For solar photovoltaics, the West must make very large investments in “factories” to transform silicon from sands and clays into the necessary crystalline silicon.

Invest in vanadium recycling at existing industrial landfills, or seek some “hostage exchange” type agreement with China.

If none of these alternatives work, the West should forget about vanadium redox batteries.

Seek strong alliances with a country with large oil reserves. That may be the line it has started with Venezuela.

In general, the West needs to invest heavily in mining. Many more mines need to be brought into operation than exist. And it has to be done quickly, which means modifying the very slow permitting processes. And, to do so even if it generates rejection because of the environmental consequences. These consequences will be the price of the transition to “green” energies, which is contradictory (another great paradox).

Invest heavily in improving existing infrastructures so that they consume less energy (insulation of buildings, …). And in educating the population to do so (not by asking them to “go cold”, but by teaching them to use resources better).

Maintaining existing fission nuclear power plants, or even increasing them. Making many efforts to improve their safety.

Finally, the West must invest in continuing research and development of promising technologies that are not yet viable for commercial use. This is the case of deep geotechnics, nuclear fusion, or mimicking photosynthesis.

In view of the above, it can be concluded that, in terms of “signing up” countries, the matter does not seem so impossible. However, in terms of necessary investments, changes in regulations, and education of society, the challenge is not easy.

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Readings that have interested me.

In the process of writing this entry I have come across many issues of other subjects. I would like to share the following:

There has been “revolutionary” news in the sport of golf. John Rham has signed for the Arab league for a lot of money. There is talk about it, but less said about what I think is more important, and which may end up extending to other areas, even non-sporting ones: there is the beginning of a pact between the future blocks of countries to decide who controls golf and how it is controlled. The monopoly of the West is over (news here). Similar pacts may come later for soccer, or even for the UN and the World Bank, which I think is what will happen.

There is very interesting news about a potential breakthrough in the way solar energy is used. The idea is to convert sunlight into chemical reactions without first converting it to electrical energy. It’s not quite what I’ve said several times about “mimicking photosynthesis”, but it’s pretty close. I like it a lot. More research will have to be done and its cost-effectiveness will have to be encouraged (news here).

I highly recommend reading this article. It is not because I totally agree with it (which I quite agree), but because it is thought-provoking. It comes to try to convince us that all the attempts we make to achieve what we call “sustainable” (energy, or whatever) are self-deceptions.

Fernando del Pino has written again. This time he dares to deal with something almost untouchable: the usefulness of democracy. He focuses on the Spanish situation, but his ideas can be extrapolated to any place. I recommend reading it (here), and let everyone draw their own conclusions.

This is as far as I go for today. In the next entries I will try to deal with the issue of agriculture.

As always, I welcome comments on my email: pgonzalez@ie3.org