This is part 6 of the serialization of Mark Mills’ report, New Energy Economy: An Exercise in Magical Thinking.
A discussion of batteries being proposed as backups for renewables is an important topic. So, I have chosen to bring together that which Mills has written about them in one posting, making it somewhat long. Consider the recent threat by the Chinese that they would withhold, from the US, the mined products that are necessary to make these batteries.
Batteries Cannot Save the Grid or the Planet
Batteries are a central feature of new energy economy aspirations. It would indeed revolutionize the world to find a technology that could store electricity as effectively and cheaply as, say, oil in a barrel, or natural gas in an underground cavern.47 Such
Jump-starting Frankenstein’s monster
electricity storage hardware would render it unnecessary even to build domestic power plants. One could imagine an OKEC (Organization of Kilowatt-Hour Exporting Countries) that shipped barrels of electrons around the world from nations where the cost to fill those “barrels” was lowest; solar arrays in the Sahara, coal mines in Mongolia (out of reach of Western regulators), or the great rivers of Brazil.
But in the universe that we live in, the cost to store energy in grid-scale batteries is, as earlier noted, about 200-fold more than the cost to store natural gas to generate electricity when it’s needed.48 That’s why we store, at any given time, months’ worth of national energy supply in the form of natural gas or oil.
Battery storage is quite another matter. Consider Tesla, the world’s best-known battery maker: $200,000 worth of Tesla batteries, which collectively weigh over 20,000 pounds, are needed to store the energy equivalent of one barrel of oil.49 A barrel of oil, meanwhile, weighs 300 pounds and can be stored in a $20 tank. Those are the realities of today’s lithium batteries. Even a 200% improvement in underlying battery economics and technology won’t close such a gap.
Nonetheless, policymakers in America and Europe enthusiastically embrace programs and subsidies to vastly expand the production and use of batteries at grid scale.50 Astonishing quantities of batteries will be needed to keep country-level grids energized—and the level of mining required for the underlying raw materials would be epic. For the U.S., at least, given where the materials are mined and where batteries are made, imports would increase radically. Perspective on each of these realities follows.
How many batteries would it take to light the nation? A grid based entirely on wind and solar necessitates going beyond preparation for the normal daily variability of wind and sun; it also means preparation for the frequency and duration of periods when there would be not only far less wind and sunlight combined but also for periods when there would be none of either. While uncommon, such a combined event—daytime continental cloud cover with no significant wind anywhere, or nighttime with no wind—has occurred more than a dozen times over the past century—effectively, once every decade. On these occasions, a combined wind/solar grid would not be able to produce a tiny fraction of the nation’s electricity needs. There have also been frequent one hour periods when 90% of the national electric supply would have disappeared.51
So how many batteries would be needed to store, say, not two months’ but two days’ worth of the nation’s electricity? The $5 billion Tesla “Gigafactory” in Nevada is currently the world’s biggest battery manufacturing facility.52 Its total annual production could store three minutes’ worth of annual U.S. electricity demand. Thus, in order to fabricate a quantity of batteries to store two days’ worth of U.S. electricity demand would require 1,000 years of Gigafactory production.
Wind/solar advocates propose to minimize battery usage with enormously long transmission lines on the observation that it is always windy or sunny somewhere. While theoretically feasible (though not always true, even at country-level geographies), the length of transmission needed to reach somewhere “always” sunny/windy also entails substantial reliability and security challenges. (And long-distance transport of energy by wire is twice as expensive as by pipeline.)53
Building massive quantities of batteries would have epic implications for mining. A key rationale for the pursuit of a new energy economy is to reduce environmental externalities from the use of hydrocarbons. While the focus these days is mainly on the putative long-term effects of carbon dioxide, all forms of energy production entail various unregulated externalities inherent in extracting, moving, and processing minerals and materials.
Radically increasing battery production will dramatically affect mining, as well as the energy used to access, process, and move minerals and the energy needed for the battery fabrication process itself. About 60 pounds of batteries are needed to store the energy equivalent to that in one pound of hydrocarbons. Meanwhile, 50–100 pounds of various materials are mined, moved, and processed for one pound of battery produced.54 Such underlying realities translate into enormous quantities of minerals—such as lithium, copper, nickel, graphite, rare earths, and cobalt—that would need to be extracted from the earth to fabricate batteries for grids and cars.55 A battery-centric future means a world mining gigatons more materials.56 And this says nothing about the gigatons of materials needed to fabricate wind turbines and solar arrays, too.57
Even without a new energy economy, the mining required to make batteries will soon dominate the production of many minerals. Lithium battery production today already accounts for about 40% and 25%, respectively, of all lithium and cobalt mining.58 In an all-battery future, global mining would have to expand by more than 200% for copper, by at least 500% for minerals like lithium, graphite, and rare earths, and far more than that for cobalt.59
Then there are the hydrocarbons and electricity needed to undertake all the mining activities and to fabricate the batteries themselves. In rough terms, it requires the energy equivalent of about 100 barrels of oil to fabricate a quantity of batteries that can store a single barrel of oil-equivalent energy.60
Given the regulatory hostility to mining on the U.S. continent, a battery-centric energy future virtually guarantees more mining elsewhere and rising import dependencies for America. Most of the relevant mines in the world are in Chile, Argentina, Australia, Russia, the Congo, and China. Notably, the Democratic Republic of Congo produces 70% of global cobalt, and China refines 40% of that output for the world.61
China already dominates global battery manufacturing and is on track to supply nearly two-thirds of all production by 2020.62 The relevance for the new energy economy vision: 70% of China’s grid is fueled by coal today and will still be at 50% in 2040.63 This means that, over the life span of the batteries, there would be more carbon-dioxide emissions associated with manufacturing them than would be offset by using those batteries to, say, replace internal combustion engines.64
Transforming personal transportation from hydrocarbon-burning to battery-propelled vehicles is another central pillar of the new energy economy. Electric vehicles (EVs) are expected not only to replace petroleum on the roads but to serve as backup storage for the electric grid as well.65
Lithium batteries have finally enabled EVs to become reasonably practical. Tesla, which now sells more cars in the top price category in America than does Mercedes-Benz, has inspired a rush of the world’s manufacturers to produce appealing battery-powered vehicles.66 This has emboldened bureaucratic aspirations for outright bans on the sale of internal combustion engines, notably in Germany, France, Britain, and, unsurprisingly, California.
Such a ban is not easy to imagine. Optimists forecast that the number of EVs in the world will rise from today’s nearly 4 million to 400 million in two decades.67 A world with 400 million EVs by 2040 would decrease global oil demand by barely 6%. This sounds counterintuitive, but the numbers are straightforward. There are about 1 billion automobiles today, and they use about 30% of the world’s oil.68 (Heavy trucks, aviation, petrochemicals, heat, etc. use the rest.) By 2040, there would be an estimated 2 billion cars in the world. Four hundred million EVs would amount to 20% of all the cars on the road—which would thus replace about 6% of petroleum demand.
In any event, batteries don’t represent a revolution in personal mobility equivalent to, say, going from the horse-and-buggy to the car—an analogy that has been invoked.69 Driving an EV is more analogous to changing what horses are fed and importing the new fodder.
I like the last paragraph as it puts batteries in perspective.
Part 7 will be “Moore’s Law Misapplied”