Unless something changes very dramatically, the green movement will be an immense wealth transfer to China.
The government via "Capitalism with a Chinese face" has locked up the market for cobalt and as that element becomes less necessary for batteries the Chinese domination of the lithium supply chain will become more apparent.
The Chinese approach to rare earths is a slightly different example: twice in the last forty years they have flooded the market to bankrupt any other producer who tries to challenge the dominance of the Mongolian mines while at the same time accepting a level of pollution in the processing chain that would be unacceptable in the West, a very important cost advantage.
In end products the Chinese boast eight of the ten largest solar cell manufacturers and though I haven't done the comparison recently, back when the subsidies were really flowing the Chinese wind turbine manufacturers equaled the combined output of the Europeans: Siemens Gamesa, Vestas, Nordex and Enercon.
Regarding that Capitalism with a Chinese face schtick, in 2018 we had the dénouement of a story that we first posted on in 2011, "Chinese Company Sinovel Wind Group Convicted of Theft of Trade Secrets" (AMSC)AMSC got so screwed by the Chinese the damage may be irreparable....
"Clean Energy, China-Style: Sex, Cash and Stolen Technology" (AMSC)
For what it's worth Sinovel is now the largest wind turbine manufacturer in China and I think, #2 in the world.
So, no matter how this plays the money is going to flow to China.
And they will use it to buy Western politicians, and academics, and businesspeople.
From UnHerd, February 17:
The age of empire is back
Later this year, a Royal Navy carrier group centred on the fleet’s new flagship, HMS Queen Elizabeth, will leave Portsmouth for the Far East, on a mission to fly the flag in Britain’s new Indo-Pacific area of strategic focus and, we are told, to “confront” China. With its complement of new British-made F-35 jets, the Queen Elizabeth will be Britain’s most significant asset for projecting power overseas. It is darkly ironic then that, like the global economy more generally, the F-35 itself is dependent on Chinese manufacturing to function.
Chiefly, the F-35 relies on rare earth elements, or REEs, to operate. Its jet engines are coated with yttrium-enhanced ceramic to achieve supersonic speeds, and it requires powerful magnets made from neodymium for its weapons systems to function. Each F-35 jet contains 417kg of rare earth elements, of which between 90% and 95% of the world’s supply is sourced from China. Between 60% and 75% of the world’s supply of finished rare earth magnets is also produced in Chinese factories.
So fragile is this supply chain, and so dependent on continued free trade with China, that the Pentagon has begun to stockpile a six-month supply of rare earth magnets in case of an emergency, with experts urging the US to invest in domestic manufacturing capacity “so if we go to war with China, we’re not calling them up asking for supply”. America’s new “National Defense Authorization Act” now calls for urgent action from the Pentagon to ensure that the majority of its REEs are sourced from countries other than China within five years.
Rare earth elements are not especially rare — they are more common than gold, for example — but they are present in the earth in microscopic concentrations, making it laborious and costly to extract and refine them. It takes between ten and fifteen years to establish the infrastructure to mine and process them: left to the logic of the free market, there is no case to do so, as it is simply cheaper to import REEs from China. The Chinese government, thinking in strategic rather than narrowly economic terms, has ploughed huge sums into developing the country’s domestic REE production infrastructure, and in doing so has established a system of Western dependency.
Surveying the global scene just a few years ago, any sensible observer would have noted that there were three potential stumbling blocks to the continued smooth functioning of the globalised economy: a global pandemic, the eruption of great power competition edging into conflict, and catastrophic climate change. The Covid crisis, as a worldwide but not especially lethal pandemic, has raised awareness of the fragility of global supply chains and the strategic necessity for domestic manufacturing capacity in multiple sectors. Yet it is the intersection of the two other risks, climate change and great power conflict, that will shape the world of our near future.
With the great industrialised power blocs now redirecting their economies towards the “green transition”, with some form of Green New Deal now the dominant medium-term economic model for Britain, the United States, China and the EU, the supply of rare earth elements and other minerals strategically vital to the new economy will become a new arena for global competition. Just as the wars of the 20th century saw wrangling for control of oil resources, the conflicts of the 21st century will seek to establish control of the elements necessary for the new technologies to function.
Green politics seems inextricably tied, in the popular imagination, with a form of utopian optimism derived from the unworldly idealism of the parties who promote it. Yet perhaps we are looking at the various Green New Deal proposals the wrong way: there is already a great deal of scepticism about their capacity to meaningfully arrest catastrophic climate change. But if we reinterpret the Green New Deal as primarily a means to restart a sluggish global economy after decades of stagnation, a gigantic form of Keynesian stimulus analogous to the New Deal after which it is named, or to the Trente Glorieuses during which a shattered post-war Europe rebuilt itself, its appeal to global policymakers compared to the alternatives of either degrowth or the status quo makes sense....
....MUCH MORE
