Wind, Solar, and EVs Are Just Part of the Solution

Climate change has and will continue to affect everyone on earth, and the challenge to arrest this process – while operating within the constraints of a modern economy – falls on all of us. Electric Vehicles and renewable power sources like Wind and Solar undeniably create cleaner energy over the long run. However, the process of manufacturing wind and solar farms, as well as the batteries used in electric vehicles, are significant sources of Greenhouse Gas emissions as well as causing other environmental, national security, and labor issues.

Even when the science behind electric vehicles, wind turbines, and solar panels has sufficiently progressed, access to cleaner liquid fuel alternatives to petroleum-based fossil fuels for the transportation sector in particular, will remain essential. Louisiana Green Fuels (“LGF”) will create this cleaner liquid fuel alternative. Not only is LGF creating a drop-in renewable diesel that would reduce emissions by 80% in the US if it was used in all diesel engines, but by sequestering carbon dioxide at source at the plant, it is estimated to have the same environmental impact as removing 110,000 cars from the roads each year.

By using wood waste to create renewable fuel combined with Carbon Capture and Sequestration at source, LGF is expected to produce the most net negative Carbon Footprint renewable diesel fuel on the market in the US i.e., the fuel produced at LGF will be better than carbon neutral, it will be deeply carbon negative.

The IPCC Report

On August 9, 2021, the Intergovernmental Panel on Climate Change, a body of the United Nations, delivered a stark warning to the entire globe: even if all nations were to sharply cut emissions today, the earth’s average temperature would still likely rise around 1.5 degrees Celsius within the next two decades.

That is to say, we are now almost certain to see a 1.5 degrees Celsius increase in the next couple of decades, no matter what we do. At 1.5 degrees of warming, scientists have found that environmental dangers increase considerably. For example, nearly one billion people worldwide would be affected by more frequent life-threatening heat waves, and hundreds of millions would have difficulty finding water because of severe droughts. However, while a 1.5 degree Celsius warming will create significant challenges the world over, a 2-4 degree Celsius increase would be, quite simply, catastrophic. That is what we must all now fight to avoid.

Finding ourselves so close to the point of no return, the United States is trying to do its part. On August 5, President Biden announced an executive order to make half of all new vehicles sold in 2030 electric vehicles.

Electric Vehicles

According to Bloomberg, in 2017, 35% of the country’s total, or 1.8 billion, tons of greenhouse gases were produced by transportation in the United States. Of this amount, 58% of the 1.8 billion came from passenger cars and light-duty trucks, while an additional 23% came from heavy-duty trucks.

Even before the administration’s announcement, investors had been keen to invest in electric vehicles e.g. Tesla, the most popular electric car company, has seen its stock price rise over 700% since the beginning of 2020 and according to CB Insights and the Dow Jones Market Data Group, at least $28 billion was invested in public and private electric vehicle companies in 2020 alone. Driven by investor interest, automakers have steadily increased their R&D budgets and continue to innovate more energy-efficient electric vehicles. However, on closer inspection, the production of these vehicles may not be as socially responsible and environmentally friendly as one might suspect.

Today’s electric vehicles rely on rechargeable lithium-ion batteries which are also common in laptops, cellphones, and many other smart technologies. These lithium-ion batteries must use raw materials found in mines such as cobalt and lithium. Almost 70% of the world’s raw supply of cobalt comes from the Democratic Republic of the Congo; according to Amnesty International, children as young as seven are at work in these mines, which can leave them with chronic lung disease from exposure to cobalt dust.

In addition, even though electric vehicles do not emit any carbon dioxide while driving, the production of electric vehicles does generate a significant amount of greenhouse gases. A study done by the Massachusetts Institute of Technology Energy Initiative found that the process of battery production for an electric vehicle alone generates higher emissions than the manufacturing of an entire gas automobile. Florian Knobloch, a fellow at the Cambridge Centre for Environment, Energy and Natural Resource Governance, came to a similar conclusion: “Producing electric vehicles leads to significantly more emission than producing petrol cars. Depending on the country of production, that’s between 30 to 40% extra in production emissions, which is mostly from the battery production.”

Given President Biden’s announcement, the US will need to go from the approximate 230,000 electric vehicles sold in 2020 to a projected total of at least 8.5 million sold by 2030. While higher environmental costs of producing electric vehicles are somewhat offset by their superior energy efficiency over the life of the vehicle, the environmental impact of producing millions of additional electric vehicles by 2030 should not be underestimated.

One must also consider that geopolitical forces will also play an important role in the future production of electric vehicles due to the location of these factories. Once the materials are mined out of the ground, they are sent to mega factories to produce the physical batteries and a large number of these mega factories are in China. In fact, by 2030, China is expected to have 140 mega factories compared to just 17 in Europe and 10 in the United States. Having such a high concentration of the world’s mega factories in China leaves the United States dependent on China for most of its battery supply. Despite no recent retaliation by the Chinese, relations between the two countries are turbulent.

In 2019, the NDRC, a State-Run Chinese Agency, released a document stating that China could cut rare earth exports to the United States as a retaliatory measure to tariffs. Although China has yet to impose this kind of sanction on the U.S., the fact that China has threatened this as retribution is concerning for the future production of electric vehicles and meeting the goals set by President Biden’s executive order.

Wind and Solar Power Generation

Solar and wind power are environmentally friendly alternatives to fossil fuels once fully completed. However, much like electric vehicles, the production and upkeep of these panels and turbines uses energy that creates a great deal of greenhouse gasses.

Steel, concrete and plastic must all be used in the production of wind turbines. On top of that, heavy diesel-powered machinery is necessary throughout the manufacturing process to clear sites, dig foundations, transport components, and ultimately assemble the turbines. Furthermore, wind turbines are typically installed in areas with low population density and away from major cities. As a result, more infrastructure is necessary to connect these turbines to power lines than is required for a single power plant.

Similarly, installing solar panels has adverse effects on the environment due to high energy consumption during production. For example, to produce solar panels, quartz is mined and then combined with various other components. Heating quartz during the processing stage requires an immense amount of heat, and the manufacturing process requires incredible precision to produce high-efficiency panels. Along with high energy usage, solar panels also create a fair amount of waste. According to the International Renewable Energy Agency, in 2016, it was estimated that there was around 250 thousand metric tons of solar panel waste in the world and, by 2050, that number could reach 78 million metric tons. With the United States recently rejoining the Paris Climate Agreement, the number of wind turbines and solar panels needed to meet the goals would double the demand for metals used in wind turbines and solar panels. More importantly, the current number of batteries produced, to store energy produced by wind turbines and solar panels is not nearly enough. To meet the goals of this agreement, the necessary number of batteries that need to be produced to store the energy created would require over 1,000% more metals than are currently being used today.

Conclusion

Wind, Solar power generation as well as electronic vehicles will be part of the US’s solution to get to net-zero carbon emissions. However, even though these solutions produce less emissions than typical hydrocarbon-based fuels, they are not a panacea and there are still both environmental and social costs associated with their production.

As the Financial Times noted in its recent article on the IPCC report: “As the planet hurtles toward 1.5C of warming, activities that remove carbon dioxide from the air will become more important.”

The Louisiana Green Fuels plant will use waste material from managed forests. Because this feedstock is a natural carbon sink (trees absorb Carbon during photosynthesis), and the LGF plant will sequester the carbon dioxide produced from the process, the fuel they will generate will actually be significantly carbon negative.

If you would like to find out more about how you can invest directly with impact in a project that is expected to generate significant economics by making the most carbon negative renewable diesel in the US market, please contact us.