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OPEC Secretary General: Theses that rely on renewable energy are “incomplete”

02-07-2024

Secretary-General of the Organization of the Petroleum Exporting Countries (OPEC), Haitham Al-Ghais, said on Monday that the theses that say that important minerals will provide the world with a future that depends on renewable energy sources and electric cars only are “incomplete.” In an article published on the organization’s official website, Al-Ghais emphasized OPEC’s orientations, as the organization believes in multiple future energy paths for countries and peoples around the world, pointing out the importance of the world looking at this matter realistically. He stressed that sustainable energy paths are vital for people around the world. When this issue is taken into consideration, it is necessary to realize the realistic impacts resulting from scenarios and policies aimed at promoting renewable energy sources and electric vehicles. He added that there are many elements involved in this matter, and one of these main elements is the role played by important minerals. He stated that minerals such as copper, cobalt, silicon, nickel, lithium, graphite, and rare metals support the development of renewable energy sources and electric vehicles, noting that the International Energy Agency believes in the zero neutrality scenario by 2050 that it published, that the demand for important minerals will quadruple by 2040, and this is an unprecedented growth pace. Unprecedented in history. Al-Ghais explained, “The purpose of shedding light on this issue should not in any way be interpreted as a detraction from the importance that OPEC attaches to renewable energy sources and electrification in the future of energy. The member states of the organization are investing heavily in renewable energy sources and in all stages of energy chains.” It supplies its own and is also involved in the development of electric vehicles. Al-Ghais raised several questions about the form of expansions in demand for important minerals in the future, and if this type of expansion is truly possible, and what are its implications and the extent of its sustainability, as well as the extent of the importance of oil and gas in expanding the use of important minerals, as well as renewable energy sources, electric vehicles, and electrical networks. Al-Ghais continued, saying that, given the International Energy Agency’s scenario (zero neutrality by 2050), by 2040, the demand for copper will rise by 50 percent, the demand for rare metals will almost double, the demand for cobalt will more than double, and the demand for nickel will nearly triple and will grow. The demand for graphite has approximately quadrupled, and lithium will witness an increase in demand for it by approximately nine times, emphasizing its important role in the battery industry. He pointed out that this will require the construction of many new mines, recalling what the International Energy Agency said in 2022 that by 2030 the world will need to build 50 new mines for lithium, 60 new mines for nickel, and 17 for cobalt. He believed that it must be taken into account that important supply chain projects throughout history for such types of goods require long periods of time for their development, especially in the period between discovery and the start of production. Here, Al-Ghais raised another important question: Is this growth rate realistic and what might be the impact if growth is weak? The most important question is what if policy makers stop investing in new oil and gas projects. Al-Ghais stated that the development of important minerals includes difficult extraction and processing activities, which shows the severity of the world that will depend on them, noting that electric cars, wind turbines, solar panels, and modern electrical networks all depend heavily on precious metals. He explained that an electric car contains about 200 kilograms of metal. In contrast, a traditional car uses only 34 kilograms. Also, producing one megawatt of electricity from offshore wind turbines requires about 15 tons of metal and 7 tons to produce one megawatt of solar energy, while that is the case for gas. Normally, it requires a little more than one ton. Al-Ghais added that mining important minerals is an activity that consumes huge amounts of energy, and it is an activity that currently depends on hydrocarbons, and there is no other alternative. He pointed out that the use of coal and gas is necessary to refine minerals through various thermal and chemical processes such as mixing to help remove other minerals and heating to high temperatures to produce more pure samples, while petroleum products also use excavators, bulldozers and trucks in these sites in addition to various forms of transportation to transport minerals. From supply centers to demand centers. Al-Ghais pointed to an article he had published at the beginning of the eighth session of the United Nations Climate Change Conference in 2023, entitled (COP28 on the Horizon: Focus on a Comprehensive Approach to the Energy System), in which he highlighted the impossibility of producing wind turbines, solar panels, and electric vehicles without using vital oil products. The oil industry, renewable energy, and electric vehicles are not separate from each other. Regarding energy consumption, Al-Ghais said that mining activities could witness an increase of more than five-fold by the middle of the current century, and it is expected that the need for infrastructure in order to build new electricity networks, such as power lines and transformers, will be one of the most important reasons for the high demand for metals, especially copper, as it is in... The zero neutrality scenario issued by Bloomberg News indicates that the electricity networks will extend for about 152 million kilometers, which is approximately equivalent to the distance of reaching the sun. In light of these data, Al-Ghais raised a number of important questions, namely: Is it realistic to believe that renewable energy sources alone will be able to meet the expected expansion in the electricity sector, especially since the world has invested more than 9.5 trillion dollars in the energy transition over the past two decades, and yet wind energy is still... Solar energy provides only less than 4 percent of the world's total energy, while the spread of electric cars around the world ranges from only 2 to 3 percent. Here, Al-Ghais mentioned that Bloomberg, in its new report (New Energy Prospects), indicated that the zero-neutrality scenario would cost $250 trillion by the year 2050. “Therefore, we see that many policy makers have begun to pay attention to the enormous requirements for minerals in zero-neutrality scenarios, as they have begun to ask many questions.” About how easy it is to increase the production of important minerals in the required and sustainable manner, as the percentage of increase in global investments in 2023 decreased from what it was in 2022.