Dave Hakes' – Island Mode

The US Inflation Reduction Act (IRA) promises $369 billion for climate and clean energy policies, but also sets the untenable task of extracting and processing key battery minerals locally. “Locally” being the operative word here. The bill says that at least 2/5 of the critical minerals used in electric vehicle batteries should be extracted and processed locally in the U.S. or with a free trade agreement (FTA) partner, or recycled in North America.

To date, no one in the U.S. is recycling these minerals in any quantity that would be quantifiable in any way (nor is anyone planning to), so we can simply drop the idea of recycling from the equation (and from this post).

An EV battery is typically made of nickel, cobalt and manganese (the three main elements of the cathode), graphite (for the anode), lithium and copper. The mining and refinement of these six minerals is controlled predominantly by China. Under the IRA, any EVs made after 2025 that contain ANY materials coming from China will be excluded from federal tax credits.

At bare minimum, the top three required minerals for “clean energy technology” are Lithium, Cobalt and Nickel. The demand for these materials will go from 7 million tons per year (today) to 42 million tons per year by 2040 – add Copper, Graphite and Manganese to the equation and it’s very simple to see the task is not possible.

Australia, Chile, and China produce the world’s lithium supply
Congo produces about 1/2 the world’s Cobalt supply
Indonesia produces about 1/3 of the worlds nickel (most of it for stainless steel – about 6% for batteries)
If you add to this that Chinese state-owned firms own (throughout the world) about 80 percent of global cobalt refining operations and more than 90 percent of refineries that produce nickel, manganese and graphite – it really makes you wonder if any actual thought went into the IRA at all. It’s very apparent that no thought went into the last 50 years as we allowed this to happen.

S&P Global says that even if every lithium project around the world came online by 2030 there is still going to be a minimum 220,000 ton shortage versus demand in 2030 – possibly as much as 2 million tons short per year. The cobalt shortage will begin in 2024. These mineral shortages will actually effect the economy in various ways. Of course, no one mentions that these are finite materials – what happens when we run out?

According to Benchmark analysts, unless 384 new mines are up and running in the next ten years, the EV transition will be “indefinitely transitional”. The world will have to open AT MINIMUM:
74 lithium mines,
62 cobalt mines,
72 nickel mines,
97 natural graphite mines and
54 synthetic graphite plants.

Just to give you an idea of where the U.S. stands today, there is ONE EV battery-grade cobalt mine in the U.S. (it is in Idaho) and one lithium mine in the U.S. (it is in Nevada).

Was there any calculation on how much the existing mines could produce? Was there any calculation on how much planned (on the drawing board to open in the near future) mines could produce? Was there any calculation on anything other than the tabulation of votes to pass something that looks and feels good to the press and public…?

I would assume that our representatives are given material to read before they vote on a subject. I often wonder if they read the material or simply vote how they’re told to vote. If they did read it, I wonder if they understand it. Do they question it? Do they try to find the answers to the questions they have before they vote?

There is not enough thought, planning, time, resources or money to phase out fossil fuels and open up the 359+ mines needed to fulfill the “climate agenda” by projected target dates (if ever). It takes a bit of time to find where to mine the minerals, a few years to get the right people into office so you can bribe them to bypass the legalities of destroying that particular local watershed and around 7 years to build a mine and refining plant – so each mine will take about 10 years to get up and running from the date of someone gathering the funds for one.

Either no one did the math on this or it is simply put in place to redirect our attention away from something else (until everyone realizes it is untenable).

There is no way in hell Americans are going to allow their local ecosystems to be stripped away, allow more species dependent on these ecosystems to disappear, allow our water supply to become even more contaminated and allow our sacred indigenous lands pilfered – long story short, this will kill our food supply. Mining for rare earth minerals generates large volumes of toxic and radioactive material. The transition to climate neutrality cannot mean leaving large tracts of the earth uninhabitable. Environmentally, everything depends on everything else. To put it simply, Big things eat little things and so on and so on and so on down the food chain – and everything needs clean water…

When I was a kid, it was all about the trees. Trees take in CO2 and breathe out Oxygen. For 50+ years we simply couldn’t regulate this. For 50+ years we couldn’t bribe these folks into doing the right thing. For 50+ years we never came up with a plan to use other materials for home construction, retrain workers how to use these materials and rework our county systems to allow for such construction.

How about a simply rule: Every tree you cut down has to be replaced and tended to maturity.

How much would it cost to pay people to plant trees and grow their own gardens? How much would it cost to bribe people and companies to stop cutting down trees for construction? How much would it cost to retrain them? How much would it cost to bribe our construction industry into using materials other than wood? I’m sure it’s a hell of a lot less than it would be to bribe ALL industry and local government into trashing our environment (and the coming “sad attempt” of cleaning THAT up after they do their thing) – does it really make sense trashing the environment to save it?

When the cure is worse than the disease where do you go from there?

I am absolutely positive that if you directed $369 billion dollars to planting trees and gardens and using something other than wood to build houses, it would get done – not only that, it would save our environment and our economy at the same time…

Here’s some simple math for you. If we directed $369 billion dollars to the above paragraph we could pay the following people for the next ten years:
We could pay 100,000 people a salary of $184,500 for ten years to do nothing but plant and tend to trees, gardens and crops
AND
We could pay 1,000 companies $1,845,000 for ten years to support the individuals planting and tending (with seed, tools, machinery, etc)
AND
We could pay 2,000 companies $1,845,000 for ten years to produce the wood replacement for home building
AND
We could pay 3,000 companies $1,845,000 for ten years to retrain construction workers on how to build with the new materials
AND
We could pay 4,000 companies $1,845,000 for ten years to stop cutting down tress for construction and to replant what they have cleared

As I write this, I think about earthbag homes. Look them up – I don’t want this post to go too off topic, so take the time to look up earthbag homes/barns/sheds/domes…

Guillaume Pitron wrote in his book “The Rare Metals War” that over the next three decades “we will need to mine more mineral ores than humans have extracted over the last 70,000 years”. This cannot end up costing the Earth. China established its dominance over the rare earths industry because of lax environmental regulations and a cheap workforce. It has paid a high price. Today, 10% of its arable land is contaminated by heavy metals, and 80% of its groundwater isn’t fit for consumption.

Do we really want to go there…? Does anyone…?