21 Stats About The Global Bitcoin Market


Which countries fight when green energy dominates?

(Bloomberg) – The Rand Corporation has been designing war games with the Pentagon since the 1950s, modeling stubborn security scenarios like a two-front US war with China and Russia. Now the think tank is turning its realpolitical toolkit on a question that is more often associated with environmental dreamers: How will clean energy change the world? Rand is among the small but growing number of research organizations, universities, and at least one European government that have begun to exploit the gritty geopolitical implications of a green energy dominated globe. It is the latest sign that the once curious idea of ​​replacing fossil fuels with renewable energies has become mainstream. The last year was a turning point. China, the world’s largest polluter, eventually joined the cascade of nations and companies setting target dates for carbon neutrality. For the first time, the European Union has generated more electricity from carbon-free sources than from environmentally harmful sources. Joe Biden won the US presidency and brought an ambitious climate change agenda to the White House. British Prime Minister Boris Johnson spoke to the United Nations Security Council last month on those who still see climate change as “green stuff from a group of tree-hugging tofu munchers” who are unsuitable for serious diplomacy. Read more: The New Energy Giants Are Renewable Companies Some experts even predict that the end of an era marked by uneven access to fossil fuel deposits will bring a safety dividend similar to that after the end of the Cold War. After all, a later Saddam Hussein would have little reason to invade Kuwait to confiscate its solar parks, as he did for his oil wells in 1990, because Kuwait’s desert area would no longer be anything special. It would be cheaper to buy panels to build yourself. “Anyone can now become an energy company, that is the nature of renewable energies,” says former Icelandic President Olafur Ragnar Grimsson, who chaired an international commission on geopolitics for the US Energy Transition. Grimsson has already seen the green future. Iceland’s energy mix is ​​85% renewable and all electricity is generated from clean sources. The last time his island nation saw a conflict with another country over resources, it was about fish. “You need a new geopolitical model, you can’t just build renewable energies into the old coal and oil model,” says Grimsson. By the time renewables dominate, oil could have a long and destructive tail. For about three centuries, access to fossil fuels has shaped the rise and fall of great powers. Numerous well-located coal mines helped set fire to Britain’s industrial revolution and the expansion of her empire. Oil and gas fueled the military might of the former Soviet Union and shaped the “American Century,” including US alliances and naval operations. “We’re not even close to a world that is dominated by renewable energies,” says Andreas Goldthau, head of research at the Germany Institute for Advanced Sustainability Studies on the Systemic Effects of Switching to Clean Energy. Changing such a fundamental driver of the global pecking order could have several consequences. Vladimir Putin may have trouble sustaining Russia’s rise as an “energy superpower”. An implosion of the US shale industry coupled with China’s dominance in renewable energy production could determine the great superpower competition of the 21st century. The reasons for American alliances and military bases in the Middle East would weaken. A sudden loss of oil revenues could spark Arab Spring-style revolts against the brittle petrostatic autocracies. The only thing we know about transitions, says Goldthau, is that “they are never, never linear.” Think of the Yugoslav conflicts after the Cold War or the departure from planned economies that the former communist bloc in the late 1980s saw started . Many ex-republics, from Ukraine to Turkmenistan, are still in turmoil 30 years later or are on the verge of market democracy. Transitions don’t necessarily end with a neatly bound bow, either. Canadian scientist Vaclav Smil has mapped the decline in coal from 95% of primary energy consumption in 1900 to just 26% a century later. In absolute terms, global consumption rose from an estimated 800 million tons per year in 1900 to around 5.5 billion tons today. While the same may not happen with oil, the fuel will likely burn much longer than most climatologists would prefer. Read more: Peak Oil is Suddenly Coming It’s hard to see a smooth, fast energy transition taking place in the current competition and on a national environment, says Eirik Waerness, chief economist at Norwegian state energy giant Equinor ASA. He served on Grimsson’s commission and generally agrees with the optimistic conclusions. “In order for the energy transition to take place in full, we probably need a relatively favorable geopolitical climate,” says Waerness. “There is, to some extent, a virtuous circle that we need to create here.” While the sources of clean energy are available to all, there will be a battle over who will benefit from the products with which they are used. Solar panels, wind turbines and batteries will be in such demand that countries are already rushing to make sure they get their share of the pie. Many will be left behind. About 60% of the solar panels are made by Chinese companies, a level of market influence that the organization of petroleum exporting countries can only dream of when it comes to oil. This creates a huge trade advantage, but not a single President Xi Jinping can easily be used for geopolitical purposes. “What are you worried about? You buy it, you run it and when you have what you have, they can’t take it away from you, ”says Karen Smith Stegen, Professor of Political Science at Jacobs University in Bremen, who has examined the potential of 165 countries emerge political winners and losers from transition. Global inequalities and rivalries are instead likely to focus on access to technology and finance, setting standards, and controlling key raw materials. China controls more than 90% of some rare earth metals used in electric vehicles and offshore wind turbines. It took advantage of that monopoly power once before, cutting Japan’s supplies after a 2010 clash near islands that both nations claim to own. Japan has since reduced the proportion of its rare earth imports from China by more than a third to reduce its exposure. In November Johnson’s UK will host the COP26 climate summit in Glasgow, Scotland, where countries will negotiate the rules for the road ahead. The heads of state and government want to ensure that everyone else is doing their fair share of reducing emissions and that their countries do not lose. This fear could lead to what the German economist Hans-Werner Sinn called the “green paradox”. He argues that the transition could push oil producers – especially those with high production costs or low reserves – to start pumping as soon as possible, as long as demand persists. The increased supply would increase CO2 emissions and also lower the price of crude oil, increase competitiveness against renewable energies and slow the transition to cleaner energy. Cheap oil could also decimate the budgets of fragile regimes before they have time to find other sources of income. A February study by the UK think tank Carbon Tracker found that 40 fossil fuel-dependent governments would suffer an average decline in oil and gas revenues of 51% if global climate goals were met. This could destabilize governments and prevent Nigeria or Iraq from affording the security to deal with threats from terrorist organizations like Boko Haram and Islamic State. A report by the European Council on External Relations last month concluded that rich countries must help fill the financial gaps. In particular, the EU’s Green Deal could have as strong an impact on regional geopolitics as it does on the earth’s climate. The bloc causes less than 10% of the world’s CO₂ emissions, but neighbors like Algeria, Azerbaijan, Russia and Turkey rely on its market to buy a large part of their exports. Many of them are carbon intensive and vulnerable to the EU’s planned carbon border tax. And there is no guarantee that reducing the energy supply to nations will reduce conflict. Oil is the most actively traded commodity on the planet, and a sharp fall in demand would reduce these interactions. “We know that trade is a good thing,” says Goldthau from the Institute for Advanced Sustainability Studies. “When states are interdependent, they have less appetite for conflict.” Back at Rand, senior policy researcher Benjamin Preston divided the world into three categories. The first is made up of countries like Iceland that have already transitioned and have little more at stake. The second are the export-dependent petrostats, which have the most to lose. The third and least studied cohort is the set of countries in between that are both producers and consumers of fossil fuels. The temptation for these hybrid cases will be to decarbonize their own economies while maximizing revenues from exports of oil, gas and coal, Preston says. This is a wild card that can affect both international politics and the duration of the transition. Take China, which has installed more solar capacity than the rest of the world combined, but also exports more coal-fired power plants. In one case, an aging facility in Hunan Province was literally dismantled to be rebuilt in Cambodia. Another solar success story, Australia recently opened a new coal mine to serve India and gave green light to the development of another $ 1 billion asset for the Asian market. The US closing the fracking industry for more than a decade has hardly boosted its economy. Meghan O’Sullivan, director of the Harvard Initiative on Geopolitics of Energy, has argued that shale also gives the US significant foreign policy freedoms. The additional supply reduced the potential for setback due to oil price effects as America imposed sanctions on Iran and blocked its oil from the world market. As renewables expand, jobs and revenues in the US and other hybrid countries will increasingly depend on decisions other countries make to keep importing their fossil fuels, Rand’s Preston said. A more peaceful renewable future is unlikely to accelerate. The trick, he says, will be “to allow safe landings for all countries that have this kind of dependency on existing fossil fuels without ending the transition altogether”. More articles like this can be found at bloomberg.com. Sign up now to stay up to date with the most trusted business news source. © 2021 Bloomberg LP

Recent articles

Crypto exchanges struggle as El Salvador adopts Bitcoin

Today, Bitcoin is becoming an official currency in El Salvador, and the markets and crypto exchanges seem to be struggling. On...

Schools are back – and time to comply with the ICO’s Age Appropriate Design Code

As of September 2, 2021, the United Kingdom's Information Commissioner's Office ("ICO") expects organizations to use their Age Appropriate Design Code ("AADC"). The...

the ICO wants input on when personal data goes international

You don't have to be a data-focused IT service provider to realize that the UK was lucky enough to receive an adequacy decision from...