From the World of Energy: Reality Will Trump Narratives On The Energy Transition Path
Why fantasy-based energy policies cannot overcome real-world limiations.
A reader asked me in an email this past week why I am so opposed to renewables and electric vehicles? His question arose from his reading of the piece I wrote here a few days ago about a company that is developing technology that has the potential to speed and increase the production of lithium, one of the array of critical minerals that the world will need vastly more of in the coming years if the “energy transition” is to really take place.
I’ve researched and published a series of stories during 2021, profiling several companies that are working to address this piece of the renewables/electric vehicles puzzle. These sectors of our energy mix rely on these minerals, which are key to the production of lithium/ion batteries that are an integral part of their growth path for the future. Given that those stories have all taken a relatively positive outlook, the question initially surprised me a bit. But then, a piece of each of those stories has contrasted the realities these various companies are facing versus the energy transition narratives currently prevalent among various governments in the U.S. and around the world, as well as the bulk of media reporting on them.
For example: U.S. President Joe Biden recently issued an executive order stating his goal that 50% of U.S. automobiles manufactured in 2030 - just 9 years from now - will be electric vehicles. Wait, it isn’t 9 years, it’s just 8, since the 2030 car models will begin to be introduced in September of 2029, unless Ford, GM, Chrysler and all the rest change their traditional marketing strategies.
That’s the narrative. This is the reality: Achieving this aspirational goal, along with Biden’s other goals related to a vast expansion of renewables in power generation, would, according to the International Energy Agency, increase demand for lithium and other critical minerals by as much as 1000%.
If that seems like a huge increase to you in such a short period of time, that’s only because it is. One tungsten mining company CEO I interviewed told me that it takes 7 to 10 years just to permit and kick off operations in a typical tungsten mine.
His company’s mine is in South Korea: In the NIMBY-obsessed United States, it can take even longer. A U.S.-based antimony mining company I profiled has been working for 7 years just to obtain a federal permit under the National Environmental Policy Act (NEPA), a process that it does not expect to be complete until sometime in 2022. Once that is done, the company will then spend several more years obtaining an array of state and local permits in time to meet its current first production date goal of 2027.
Obviously, these reality-based timelines do not line up with the aspirational narrative. Biden and congressional Democrats appear to believe that they can just earmark a couple hundred billion dollars in their $1.2 trillion infrastructure bill to provide subsidies for the renewable and EV sectors and everything will just magically speed up. But the real world does not work that way.