China Is The Biggest Winner Of The U.S. Renewables Boom

As the shift to renewable energy begins to gain serious momentum, the United States is now facing another conundrum: Being too dependent on China for the minerals used to build clean energy systems.

China accounts for around 80% of U.S. rare earths supply, materials used in many renewable energy and high-tech goods

Since the days of President Jimmy Carter and the 1970s oil crisis, the U.S. has relentlessly pursued the utopia of becoming energy independent. But with persistent oil crises and severe oil price shocks, it has become glaringly obvious that Washington will never achieve true energy independence by relying solely on fossil fuels, even if the United States finally becomes a net oil exporter.  The majority of America’s citizens also feel that the government should ‘‘…focus on developing alternative sources of energy over expansion of fossil fuel sources’’ in a bid to alleviate climate change.

Whether it’s in the pursuit of energy independence or in a bid to ameliorate climate change, there’s an undeniable shift to renewables going on in the U.S., with renewable energy accounting for 11.4% of total U.S. energy consumption in 2019 compared to only 4% two decades ago.

But as the shift to clean and renewable energy begins to gain serious momentum, the United States is now facing another conundrum: Being too dependent on China for the minerals used to build clean energy systems.

China supplies ~80% of the rare earths elements (REE) used by the United States to manufacture windmills, solar panels, electric car batteries, cellphones, computers, medical equipment, national defense systems, and even in oil and gas technologies.

Source: EIA

Depending on China

Back in 2018, the Interior Department released a list of 35 minerals it classified as being ‘critical’ to the U.S. economy. The alarming part: The U.S. entirely relies on imports from China for 14 of these minerals, and imports 75% of at least another ten. 

Those figures are not exaggerations: According to the U.S. Geological Survey, China supplied 80% of the U.S.’ REE in 2019. Yet another worrying statistic: Although the U.S. mined 18,000 metric tons of its own rare earths in 2018 and 26,000 metric tonnes in 2019, the U.S. Geological Survey has revealed that all domestic production of mineral concentrates was exported. Only three decades ago, the U.S. was the world’s number-one producer of these minerals but has slipped down to seventh place.

China’s vice-like grip on the U.S. REE supply chain would become as clear as daylight if Democratic presidential candidate Joe Biden ascends into the Oval Office and starts to implement his $5 trillion climate plan. 

Biden has pitched a highly ambitious $5 trillion-plus climate proposal that he says would be necessary if the U.S. is to match the EU by becoming a net-zero carbon emission country by 2050. Biden has proposed a staggering $1.7 trillion in federal spending over the next decade to achieve this goal, with the private sector expected to chip in with the balance. Biden says the taxpayer costs can be recovered by repealing the generous tax bonanza that Trump granted U.S. corporations and also by eliminating subsidies to the fossil fuel industry.

Becoming Self-Sufficient

With China being home to nearly half of the world’s known REE deposits, the U.S. will have little choice than to ramp up its imports of these minerals from the Middle Kingdom as it transitions to renewables, something not made easy by the fact that the entire globe is in the same race to shift from fossil fuels to cleaner energy. Further, the specter of China using its strategic control of REE’s in a trade war remains very real.

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The post China Is The Biggest Winner Of The U.S. Renewables Boom appeared first on The Global Warming Policy Forum (GWPF).

via The Global Warming Policy Forum (GWPF)

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August 18, 2020 at 03:53AM

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