A few weeks ago, whilst doing some research, I stumbled across an article by Craig Canine of On Earth Magazine, called “Renewing our Dependence”. In it, he talks about how China has positioned itself to regulate and charge us for our high-tech, “green energy” future.
How are they going to do this? China has large deposits of what are called “rare-earth” metals, for use in car sensors, Prius batteries, and every iPod in existence. They managed to pressure US companies out of the market during the 80’s, by dropping prices to unsustainable levels. US environmental regulations finished off the rest of the domestic mines. We now import 100% of our rare earth metals. There is literally no domestic production whatsoever, although we will be back online with smaller amounts in 2011.
The major problems that we are going to have are twofold: Increased demand for “green energy”, and the always nagging problem of Chinese domestic consumption. According to Mr. Canine, a modestly-sized wind turbine takes at least 700 lbs of the rare-earth metal neodymium. The average Toyato Prius battery requires 25 lbs of the same metal. It’s a requirement. That doesn’t include smaller amounts of various other REMs. Now, think about your cell phone, computer, vehicle frames, and other technologically superior devices. Ask yourself if demand is growing or shrinking over time.
Remember when I wrote a month or two ago about the growing Chinese middle class? Do you think their appetites are growing or shrinking for tech devices, especially since most of our electronic devices are produced there? Do you think that maybe, just maybe, Beijing has a “green” strategy as well? It turns out,they do. 100 Gigawatts of wind-generated electricity by 2020. That, according to an article by a Mr. Jack Lifton of SeekingAlpha.com, will require nearly 100,000 metric tonnes of neodymium. Bottom line, China doesn’t have it. Australia does. To wit, China has made two very strategic acquisitions: Australia’s Arafura and Lynas companies.
The bottom line of Mr. Lifton’s piece states the obvious: Prices will rise dramatically in the rare earth sector over the next few years. This is going to be the new boom sector (my words, not his). The good news is that American mines may be able to snap back into action as a result. The bad news is that China is going to be using both its own supplies of REMs, and those that used to belong to Australia as well.
My bottom line is this: The cost of so-called “green energy”, in environmental and monetary terms, is going to very steep in the near future. As usual, the people who push these agendas have no concept of the actual costs of implementing such policies. We’ve seen this with the failure of ethanol-based biofuels. Who knew the costs in water, diesel, soil depletion, and their impact on costs at the supermarket? Anyone with half a brain, that’s who. It’s an inefficient process, and the average farmer could have told you so before you started.
The same holds true for windpower. 700 lbs of neodymium for a turbine. You know, they are called “rare-earth” metals for a reason. When extracted, they have to be extensively processed. This uses quite a bit of electricity. The electricity costs were so high, that Japan all but stopped processing 3-5 years ago. These costs also must include fuel for the heavy equipment, water, and other onsite chemical agents, along with other miscellaneous resource expenditures.
Basically, this creates a huge problem for the “green” crowd. Let me frame the inherent problem like this: If they want to protest a rare-earth mine re-opening, they have to drive their Prius (with it’s Chinese REM based battery) to the protest. Then, they have to post their outrage online using their MacBook (manufactured in Shanghai, China using Chinese REMs). From there, they drive to a protest over dirty coal, when the environmental impact from the manufacturing of their wind turbine possibly has a greater impact per watt produced. At least they will feel like they did something for the environment. That’s what matters, feelings…of smug superiority.
Well, thanks to the wonderful feelings of these activists, and the lackeys over at the EPA, we will have yet another reason to be beholden to the Chinese. You know, in addition to the Trillions in T-Bills that they hold, along with real estate, and various other holdings. Congratulations, we have gone from subjection to OPEC, to Chains from China. Now, every time we make a noise about human rights, or some kind of garbage like that, all they have to do is give the chains a good shake. But, hey, at least those chains will be Carbon Neutral.
That’s all for today. Stay tuned for the latest news affecting the tire and mining industries.
Until then, we’ll be…
Signing off..
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{ 2 comments… read them below or add one }
So, what is your suggestion for people, planet and pocket to have a safe and secure energy future?
Alex, I notice you are from a Zero Emissions vehicle site. I personally, that we are going to have to rely on something besides battery technology for cars. I am heartened by the progress of Tesla Motors, and I really liked the EV-1, believe it or not.
I personally would drive an electric car. However, I don’t believe anyone could call such a car “environmentally friendly”. A vast technological improvement over current vehicles, yes.
As far as pocket, planet, people go….unless there is a major, world-changing development in how energy is produced, stored, and re-supplied, the future is pretty bleak.
I am a firm believer in building more nuclear reactors in the short term. As far as pocket goes, we are reaching a point at which we are going to pay more for everything. The die has been cast.
So unless America develops, owns, and is able to protect a new energy source, we’re out of the running 10 years from now.
That’s all I’ve got.