The energy transition highlights the urgency in “knowing thy supply chain”

Something came to me on my weekly beach week yesterday. 

Incidentally, the summer in SoCal has been quite temperate and the ocean is often colder than normal – just makes you realize the factors that impact our weather are highly complex, but I digress. 

I speak and write about the need to take a holistic approach to deliver on the primary goal of delivering affordable, reliable, and accessible energy that is as clean as possible to all people. This is in the context of the shift from a fossil fuel-based energy system to one that is minerals/materials-based. And, what I have labeled the looming ‘Minerals Famine,’ places at serious risk the chance of any company or government meeting their 2035-2050 transition goals.

I then read an excellent recent paper from Samantha Gross at The Brookings Institution on Reducing US Oil Demand, and it made me realize that activists and Western governments are caught in this kind of dichotomy:
 

1. On the one hand, they seem obsessed with reducing the supply of fossil fuels in the USA (oil, gas, and coal) via any mechanism, including canceling projects without any real regard to maybe first reducing demand (the theme of Samantha’s paper).
2. Conversely for renewable energy, they are obsessed with switching energy to renewable sources and increasing demand for electricity, with little to no regard to the upstream supply of minerals (esp. copper and nickel) needed for all those EVs and major wind and solar projects. In fact, many of these folks are actually anti-mining as well!
    

Economics 101 is all about ‘know thy supply chain’ and the need to focus both upon demand and supply at the same time to avoid massive dislocations and unintended consequences. In this time of Climate Week in NYC, these are serious considerations where we need to better understand the risks and the implications.