Tag Archives: green energy

Mining the Earth to Save it

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The rush to secure green-energy metals is bringing new life to one of the world’s oldest mining hubs. Like the United States, Europe is worried that it is too reliant on China for supplies of once-obscure natural resources, such as lithium and rare-earth metals, that are seen as climate-friendly successors to oil and gas…. 

On both sides of the Atlantic, one of the best answers to long-simmering worries about green-energy security is to look north…, for example, to the “Canadian Shield,” a vast band of rock encircling Hudson Bay. The “Baltic Shield” that stretches across Scandinavia to western Russia is similarly mineral-rich. It helps explain why Sweden in particular has such a long mining heritage. In the mid-17th century, the country’s “Great Copper Mountain” near Falun provided two-thirds of the world’s copper. Even today, 80% of iron ore mined in the EU comes from a site near the Arctic town of Kiruna that Swedish state operator LKAB has exploited for well over a century.

The energy transition is an opportunity for Sweden’s mining complex. LKAB said in January 2023 that it had identified Europe’s largest body of rare-earth metals close to its existing Kiruna operation…Digging up the planet to save it is an awkward pitch. The only way for miners to counter accusations that they are adding to the problem they want to solve is by decarbonizing operations. Here Sweden is again helped by the geology of the Baltic Shield, whose river valleys are favorable for green-energy production. Roughly 45% of the country’s electricity comes from hydroelectric power, with much of the remainder provided by nuclear and wind. It is also cheap, particularly in the Arctic, where many mines are located. Against a favorable geopolitical backdrop, the biggest risk for investors is political. Mines, which can bring a lot of noise and relatively few jobs to an area, don’t tend to be popular locally.

There is a reason the West relies on autocracies for a lot of its oil.

Excerpts from Stephen Wilmot, For Mining EV Metals, the Arctic Is Hot, WSJ, Feb. 14, 2023

The Limits of Green Energy: Wind Blades of Wood and Plastic

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What does the deforestation of balsa wood in Ecuador’s Amazon region have to do with wind power generation in Europe? There is a perverse link between the two: a drive for renewable energy has boosted global demand for a prized species of wood that grows in the world’s largest rainforest. As Europe and China increase the construction of blades for wind turbines, balsa trees are being felled to accelerate an energy transition driven by the need to decarbonize the global economy.

In the indigenous territories of the Ecuadorian Amazon, people began to notice an uptick in international demand for balsa wood from 2018 onwards. Balsa is very flexible but tough at the same time, and offers a light yet durable option for long-term wind power production. The typical blades of a wind turbine are currently around 80 meters long, and the new generation of blades can extend up to 100 meters. That means about 150 cubic meters of wood are required to build a single unit, according to calculations by the United States National Renewable Energy Laboratory.

Ecuador is the world’s main exporter of balsa wood, holding 75% of the global market. Major players include Plantabal S.A. in Guayaquil, which has around 10,000 hectares dedicated to the cultivation of balsa wood destined for export. With the boom in demand starting in 2018, this company and many others struggled to cope with the quantity of international orders. This increase has led directly to the deforestation of the Amazon. Irregular and illegal logging has proliferated by those who have reacted to the scarcity of wood grown for timber by chopping down the virgin balsa that grows on the islands and riverbanks of the Amazon…

The impact on the indigenous people who live in the area has been as devastating as mining, oil and rubber were in their day…The Amazon’s defenders are calling for the wind turbine industry to implement strict measures to determine the origin of the wood used in turbine blades, and to prevent market pressure leading to deforestation. Ultimately, they say, balsa wood should be replaced by other materials…

In 2019, Ecuador’s balsa exports were worth almost €195 million, 30% more than the previous record from 2015. In the first 11 months of 2020, this jumped to €696 million.

Wind turbine blades are mainly made from polymethacrylamide (PMI) foam, balsa wood and polyethylene terephthalate (PET) foam…But The Spanish-German company Siemens-Gamesa..has  introduced blade designs using PET only, other competitors soon followed. Wood Mackenzie, a consultancy firm, forecasts that this “will increase from 20% in 2018 to more than 55% in 2023, while demand for balsa will remain stable…”

Today’s blades also present a problem for recycling. The first generation of wind turbines are reaching the end of their lives, and thousands will need to be dismantled… “But the blades represent a challenge due to their composite materials, as their recycling requires very specific processes…

Excerpts from How the wind power boom is driving deforestation in the Amazon, ElPais, Nov. 26, 2021

An Impossible Made Possible: the Green Energy Revolution

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Since the cost of renewable energy can now be competitive with fossil fuels. Government, corporate and consumer interests finally seem to be aligning.  The stock market has noticed. After years of underperformance, indexes that track clean-energy stocks bottomed out in late 2018. The S&P Global Clean Energy index, which covers 30 big utilities and green-technology stocks, is now up 37% over two years, including dividends, compared with 18% for the S&P 500.

This year’s Covid crisis will delay some renewable projects, but could speed up the energy transition in other ways. Alternative-energy spending has held up much better than spending on oil and gas. Globally, clean-energy investment is now expected to account for half of total investment in the entire energy sector this year, according to UBS.  Moreover, the crisis has pushed governments to spend money, including on renewable technologies. The massive stimulus plan announced by the European Union last month is decidedly green. The German government increased electric-car subsidies as part of its pandemic-related stimulus package rather than rolling out a 2009-style “cash-for-clunkers” program. China’s plans include clean-energy incentives, too.

Solar and wind are now mature technologies that provide predictable long-term returns. Big lithium-ion batteries, such as those that power Teslas, are industrializing rapidly. More speculatively, hydrogen is a promising green fuel for hard-to-decarbonize sectors such as long-haul transport, aviation, steel and cement.  Many big companies—the likes of Royal Dutch Shell, Air Liquide and Toyota —have green initiatives worth many hundreds of millions of dollars. They are, however, a relatively small part of these large businesses, some of whose other assets may be rendered obsolete by the energy transition… Early-stage electric-truck maker Nikola jumped on its market debut this month to a valuation at one point exceeding that of Ford.

Investors might be better off looking at the established specialists in between. Vestas is the world’s leading manufacturer of wind turbines. Orsted, another Danish company, has made the transition from oil-and-gas producer to wind-energy supplier and aspires to be the first green-energy supermajor. More speculatively, Canadian company Ballard has three decades of experience making hydrogen fuel cells.

Rochelle Toplensky, Green Energy Is Finally Going Mainstream, WSJ, June 24, 2020