There just aren’t enough minerals to make it happen
By Karen Bufka
I have a crush on a man named Mark Mills. Why? Because of his remarkably lucid, down-to-earth, information-packed presentation Energy Transition Delusion: Inescapable Mineral Realities.
For me, apparently, clear-thinking and well-informed is the new sexy.
Mr. Mills, Senior Fellow at the Manhattan Institute for Policy Research and Faculty Fellow at Northwestern University McCormick School of Engineering is addressing investment professionals at the Skagen Funds’ New Year’s Conference 2023 but we can attend with them on Youtube.
I consider it foundational for any discussion of S.5, the Affordable Heat Act or any other proposed public policy regarding the implementation of renewable energy technologies here in Vermont.
His thesis: whatever our aspirations, the world’s mining can not and will not be able to supply us with the required quantities of the two dozen or so minerals needed to make the machines of our world’s “Energy Transition”.
He briefly acknowledges the social and environmental problems associated with mining these minerals, the political and economic challenges, too, but his very simple message is that all of those pale in comparison with the simple issue of getting enough of these minerals out of the earth to supply the anticipated, skyrocketing demand.
In the mining world, problems are solved over decades. The world needs hundreds of new mines to supply the minerals for batteries and solar panels, but mines take 16 years to get going. Investment in mining globally is less than 10% of what it needs to be, so how are those hundreds of new mines going to happen? And are they going to happen immediately? Unlikely.
The video is 46 minutes long, but if you want to get the point and have limited time, start @9 minutes in and go as far as you can. He notes that an EV requires 400% more minerals (and different minerals) to build than a conventional car. It takes 1000-2000% more minerals to deliver the same unit of power as that conventional car.
If you shift from talking about power to talking about delivering energy with EVs, solar panels or wind turbines—actual miles driven, or the heat, light or computing time they produce— then it takes 2000-7000% more minerals per unit of energy delivered for us humans to use. The point: you need lots and lots—and lots!— of these specific minerals to get the intended jobs done.
Copper is one of the necessary minerals, one that doesn’t have a substitute. A shortage is expected in the next 2-3 years. Demand will outstrip supply and guess what will happen? Inflation. The price will go up. Mr. Mills proposes that this will happen for all of the minerals fairly soon. 70-80% of the cost of batteries, solar panels, and wind turbines is in the purchase price of the materials used to make them.
He explains that we can anticipate rising costs for all of the minerals of the Energy Transition because of the global push to increase the use of the technologies, and the mining industry’s inability to keep up with the demand.
Prices for batteries, solar panels, wind turbines will rise dramatically. This needs to be carefully considered before passing any bill which will make it more difficult to use our existing cars and furnaces or which will assume that we will be able to easily or affordably replace them with the technologies of the Transition. Even with incentives, we might not be able to.
Please contact your senator, or all of Vermont’s senators, to share your thoughts/concerns about S.5, the Affordable Heat Act, and to encourage them to consider relevant realities—like what is discussed above— before they vote on it. You can call the Statehouse (802)828-2228 and leave a message or call or email them directly. Find your senator’s contact info here.