climate change: the world is running out of time, no minerals for technologies that preserve the climate

The world is not reducing greenhouse gas emissions with the speed needed to avoid the most dangerous effects of climate change, as claimed in the latest United Nations climate report released this month. Despite this, it has become something of a trope to warn that we risk going too fast.

The overlapping drivers and effects of the Russian invasion of Ukraine, Covid-related supply chain disruptions and rising inflation have all fueled a set of random narratives that the transition to a clean energy will be highly inflationary or, on the contrary, it will stagnate.

Concerns generally focus on the implications of the growing demand for products such as cobalt, lithium, nickel and copper that are used for electric vehicles, photovoltaic solar cells, wind turbines and power grids. Isabel Schnabel of the German Bundesbank spoke in January about the inflationary effects of green energy; although she later acknowledged that this had to be considered alongside the inflationary effects of fossil fuels and climate change itself.

These warnings usually cite a fact about the resources needed to build new energy infrastructure. The IEA points out, for example, that an electric vehicle consumes six times more metals than a fossil-fuel car and that wind farms consume nine times more than a gas-fired power station. The shock value of this analysis does not entirely stand up to scrutiny. On the one hand, he fails to recognize the absence of fuel in the equation; an internal combustion pickup truck will use $25,000 of fuel in a decade, according to the Energy Information Agency’s Low Gas Price Scenario.

It also has to deal with economics 101: more demand and higher prices will lead to more supply. Scarcity of raw materials is a popular fear, but the last two hundred years have seen humans develop increasingly efficient ways to find the things we want underground and extract them.

The examples are plentiful. Consider America’s shale oil boom over the past decade: The country’s oil production more than doubled between 2008 and 2018. Peak oil supply – or at least a secular shift to a higher crude price – was a credible threat just over a decade ago. Economically recoverable “resources” and “reserves” of transition minerals have tended to grow over time, even as production continues. “Economically viable reserves have increased despite continued production growth,” the IEA notes. Data from the United States Geological Survey confirms this:

Bloomberg

Innovation also helps on the demand side. Electric car batteries today use much less cobalt than a decade ago, and researchers are confident in the prospects of doing without this rare mineral altogether.

There is also recycling to consider. Australian researchers have projected the demand for minerals in a scenario to meet Paris Agreement targets that includes a 100% renewable energy system. They found that plausible improvements in technology and recycling can cut cobalt demand by two-thirds, putting it well within the range of current resources, and not too much above current reserves.

386773958Bloomberg

It is true that some metal and mineral mines used in zero-emission energy systems will take years to come online. The IEA estimates four to seven years for lithium, depending on whether it is in Australia or South America. Copper mines can take over a decade. It’s easy to see that this could be a problem if demand increases unexpectedly quickly.

Despite all this, when IMF staff attempted to model the price effects of booming demand for minerals, the results were not so dramatic. Looking at copper, lithium, cobalt and nickel requirements to achieve net zero emissions by mid-century, they found that actual prices would generally not exceed levels reached during price peaks. previous ones, although they may persist at higher levels for longer.

Finally, as the IEA points out, there are “significant differences” between oil and mineral supply shortages: an interruption in oil supply affects everyone who drives passenger cars, diesel trucks, etc. ., while a shortage of mineral supply only affects the supply of new electric vehicles. — not those who already use them.

The pitfalls of reducing emissions need to be seen in a broader context. The rush for minerals to build new energy infrastructure is only a temporary problem. The IMF estimates the minerals crunch at 15 years; the IEA considers it to be nearly a decade long. The warmer climate, on the other hand, is likely to be irreversible on any timescale that humans can plan.

Transitioning to a non-warming world means betting that human ingenuity can optimize the relatively familiar challenges of extracting material from the ground, using and reusing it, and distributing the benefits. These are the kinds of challenges with which modern economics is very familiar.

Ignoring the transition means embracing a descent into an increasingly unstable climate. It’s something that our modern society has very limited experience with – but what we do know is dire.

(The one-stop destination for MSMEs, ET RISE provides news, views and analysis on GST, exports, finance, policy and small business management.)

Download the Economic Times News app to get daily market updates and live business news.

About Kristina McManus

Check Also

Trans woman offers message of inclusion aimed at saving lives – Knox County VillageSoup

WALDOBORO – Rachel Genthner of Waldoboro argues that denying who you really are and fighting …