 the state of clean energy. I'm your host, Mitch Ewan. Our underwriter is the Hawaii Energy Policy Forum. That's a program of the Hawaii Natural Energy Institute. I'm very pleased to welcome our guest, return guest, Peter Sternlich, of Sustainable Energy Hawaii. And today we're going to be talking story about our global energy reality and its implications for humanity. So Peter, welcome to the show. Thank you. Pleasure to be here. Yeah. So just to get us calibrated and get going on this, how important is energy? I mean, we all know what energy is, I think. What is the relationship between energy and our economy and our way of life and how we live? Well, I mean, there's, you know, there are those that say energy is everything or everything is energy. But within the context of our economy, energy really is the master resource. So what you see here is a chart that graphs GDP and energy consumption against each other. And just so people just tell them what GDP is. That's a gross domestic product. The pressure. It kind of measures how well our economy is. Yeah, the pressure was on. So what the historical data in this chart shows us is that there's a direct correlation between the two and that the deviation between energy consumption and global GDP over 50 years has been less than 1%. So at the bottom, excuse me, at the bottom, we have a quote from Robert Ayers where essentially he describes or explains that everything that takes place in every economy requires energy. And so what we do is we actually transform that energy into products and services. So that, I mean, without energy, we don't do anything. Yeah, somebody once told me, if you're going to sit on a park bench or you're waiting for your bus and you look at everything around you and say, gee, how much energy is in that? There's everything in the roads and the steel for the seat you're sitting on, the buildings, everything took energy, the clothes you're wearing. It's there. So we're hearing a lot about climate change these days. Every time we have a new storm or a new disaster, we talk about climate change. And there seems to be a desire to reduce and eventually eliminate the use of fossil fuels. What are your thoughts on how this is influencing policy? We are the policy forum here. Yeah. Well, today, we're definitely deeply involved with climate change. But I think the reality is that what we're doing is we're involved in an energy transition. We're changing how we power our economy. What we're trying to do is literally is to electrify the global economy. We're going from fossil fuels to electricity. And the way we are explaining or justifying doing that to ourselves is that we're trying to decarbonize everything. So anyhow, I think it is fair to say that decarbonization is the primary goal around which global energy policy is being conducted. We want to decarbonize our energy consumption. But if we look at the big picture of energy consumption, as I look at that big picture of energy consumption, I find myself asking some questions. Like, is decarbonization really the best metric for setting policy? I mean, carbon is an issue. And I'm not suggesting it isn't. But is it the only issue surrounding energy that needs our attention today? So one of the questions to begin with is, are we being effective at this strategy? Are we reducing the amount of fossil fuels we're using? And are we reducing the amount of carbon we're emitting into the atmosphere? So given today's economy and the population that we have on the planet, do we actually think we can eliminate fossil fuels from our energy mix at any point in the future and keep the system, the economy, the way that we live going consistently? Well, let's look at some data now and to show the impact, the percentages of fossil fuels versus the upcoming renewables. Sure. So what you have here is a graph that tallies global energy consumption since 1800. And it runs through 2022, which is the last year that we have a complete annual set of data. And it includes both fossil fuels and renewables. And what we've done here or what the people who created this chart have done is they've converted everything into a common metric, which is electricity terawatt hours. And so from there, we can compare oil to solar panels or wind turbines or hydroelectric plants. So if you look at the graph, you can see that the three sources with the highest energy output are oil, coal, and natural gas. And towards the bottom are all the renewables that are electrical power, hydro, biomass, nuclear, wind, solar, etc. And if we look at the vertical index there, we see that oil alone provides 50,000 terawatts of power in the year 22, if you look at the far, far right hand side. Coal is right behind it, about 45 natural gases at 40. All the renewables sit at about 12,000 or less. That's pretty low. So just to... We're getting there. Take it to the last 20 years. Let's drill down further and pull up the next slide. There you go. And we've got some nice little red circles there. So why don't you explain what we're seeing there, Peter? So this is the same chart, but it's stretched out horizontally to only cover the range of the year 2022. And I think this is the time frame we really want to look at, because that's where the majority of our decarbonization efforts have taken place. And we see that hydro to additional biomass, nuclear have maintained a relatively constant level or contribution to the energy mix. But that wind, solar, and renewables are really just coming into play. This is not looking very good, Peter. So... Well, I mean, realistically, you've got to start somewhere. But I think the point of this is that we're trying to... That we're looking at what is driving our strategy. And what's driving our strategy is the idea of decarbonizing our atmosphere because of climate change. And so the question is, are we actually doing that? We can actually take some of the data that was pulled off these charts and drill down into it. So what we have here is on the left, we have a chart that represents the energy consumption during the year 2000. And on the right, we have the year 2022. We can also see that what we've done is broken the data into subcategories of fossil fuels and no or low carbon fuels. So the nuclear and biomass... I was going to say, yeah, nuclear and biomass aren't really renewables. But for the ease of discussion, I'm just going to, as we go on, I'm going to refer to them as renewables, even though they're labeled as no and low carbon. So in the year 2000, we consumed about 94,000 terawatts of fossil fuels and about 28,000 terawatts of renewables. And that mix calculates out to be about 77% of the energy mix was fossil fuels and 23% renewables. So if we look at 2022... Which is 22 years. Yeah, it's actually 23. But if we look at 2022, we see that we consumed 137,000 terawatts of fossil fuels, which is an increase of 45% in that period of time. So we're consuming... I thought we were supposed to be going down. Yeah, we were, but we went up 45% since 2000. And with renewables, it grew also about the same amount, 46%. And so between the two overall, the increase in energy was 46%. You can see that at the very bottom of this slide. And what really shocked me was to look at the relationship between renewables and fossil fuels over that, the 2020-22 time frame. And it didn't change at all. It's exactly the same. It's amazing. So not only are we consuming more fossil fuels, we're logically emitting more carbon and greenhouse gases. So this focus on decarbonization goes back to the question I asked a little earlier. Why do we believe that this is something we can achieve? And is carbon... And this is something that I'm not meaning to suggest that pursuing these other renewables is a waste of time. But the way we describe what we're doing and what's motivating us in the goal we're seeking may not be properly assessed. It may be, but it may not be. I'm looking at the historical data and I'm going, where's the progress? So what's the connection between fossil fuels and renewable energy? Are renewables truly fossil-free? I guess that's how you define it. Yeah. And the thing is, as far as the general public goes, as far as just our community and how we look at this, we think about renewable energy and we think about solar panels and we think about wind turbines and batteries and all the stuff that we're using to to transition away from direct use of fossil fuels. But there's a difference between a renewable energy source. Sunlight is a renewable energy source. The heat under our feet with geothermal is a renewable energy source. But the systems that we use to transform that energy into something that can do work for us requires fossil fuels. To do the mining of raw materials, the processing, the manufacturing, the assembly of the systems and the distribution, the global distribution of everything that we produce in the world in a global economy, that is exclusively done with fossil fuels and in particular liquid fossil fuels. Petroleum is what powers all this stuff. Yeah. You've got to get all this stuff from the mine to the factory and, like you said, take ships and trucks and everything else like that. And they all run it right now. They all run on fossil fuels. Yeah. So I think it's important that as a society, as a culture, we have a proper picture of what it is that we're attempting to do and also what we're actually doing and succeeding at. Because if we focus on carbon and we have other situations, which we'll get to into a little bit later in this presentation, are we picking our battles? Are we verbalizing it in the proper context so that we approach it with the right expectations? Because people don't like to be disappointed. All of these systems start with mining. And it's not something that we think about, but everything is made from stuff we dig up out of the ground. And that includes oil and coal and all of the metals and minerals that we use to manufacture all this stuff, the silicon, the polysilicon that goes into our solar panels, that comes out of the ground. I think having an understanding that that's what's happening, I think is important again so it sets our expectations in a proper way. So where do we get all this stuff that we dig out of the ground? This is an illustration of the mining productivity around the world and the size of the circles is relative to the volume of minerals that are specified by the little colored pie slices around there. And I think it's pretty clear that the largest contributor to mining raw materials and here's CRM and SRM are critical raw materials and strategic raw materials. So these are all things that, as the names suggest, are critical and strategic to our national security and also the way we want to live. So if we go to the next slide. Before you do that, I just want everybody to focus on the China pie. Look how big that is compared to everybody else. That's our good friend. It's our good friend. No geopolitics there at all. Yeah. So okay, now we can move on to the next. And this next slide is also kind of overwhelming. Yeah, because it's also, it has to do with where all of these things are processed. When you dig materials out of the ground, it comes out as, you know, like it's all mixed up with dirt and rocks and all this other stuff. And so it's got to be filtered and processed and purified so that we can make stuff out of it. And as that slide illustrates, the vast majority of processing and in particular for critical raw materials, China again is the number one. It's dominant. It's absolutely dominant. I think that paints the picture is that there is in addition to a supply chain issue, one of the things that affects the supply chain is geopolitics. And it's also going to be economics. So if for any reason, you know, the supplies are curtailed in any way at all, who's going to get them? Who makes that decision? How much does it cost? These all have implications in our desire to decarbonize. So that's a prime example of that is the solar industry. So if we go to the next slide, it's really staggering. We're really relying on, you know, just solar panels, solar panels, solar panels. I mean, I don't know. I mean, one of the things that I suppose I could have pointed out in that chart that showed the comparison between 2000 and 2022 was that the deployment of solar globally in that period of time was 110,000% increase. So that's an 1,100 times what we were doing in 2000 is what we were doing in 1,100 times that much. That's a lot. In 2022 is a lot. And it made zero difference in the mix. And we still increased how much possible. So yeah, I mean, so anyhow, yeah, if we go back to this, you know, to the slide with the map about the polysilicon. So that is, yeah, that one. So China is, again, dominant. They control 75% of the global polysilicon supply from which panels are made. And they manufacture 80% of the finished panels. So, you know, again, it's like, you know, we look ahead 20 years and they're selling economic oxygen. And we're dependent on that. How do we become, you know, looking at the solution, which is something that probably will take a whole program in and of itself, the world needs to become locally self-reliant, self-sufficient. And that, yeah, that's a whole another subject. So anyhow, we're fabricating or we're creating quite a level of dependency in addition to the carbon we're putting into the atmosphere. So let's have a look at some of the critical materials. So let's pull up the next slide, slide 12. I think we'll spend a little bit of time on this slide because this is a very important description of what we need. All right. I'm pulling this up on a different screen so that I can see it. So a colleague of mine who works with the Geological Survey of Finland, Simon Michele, has done some pretty groundbreaking work and done some, he's done an analysis of, okay, if we want to replace fossil fuels, what's it going to take? So he's looked at the constituent portions of copper, nickel, lithium, cobalt, graphite, bonadium that will go into not only the generation systems, but also the storage systems that we have to use because all of these things wind and solar are intermittent. They don't, they're all, you know, they're affected by weather and of course, whether the sun is shining or not. So in the leftmost column of numbers, he's calculated the amount of metals that would be required to produce just one generation of what he's referring to as technology units to phase out fossil fuels. So with copper, he's come up with this number of 4,730,000,000 metric tons. But in the middle column, what we see is that what all the geological surveys around the world estimate as being the total reserve on planet earth is only 18% of that. So the, so our ability to build this from those mined materials may not exist at the level we're targeting. And is that part of, part of the discussion that we're, we're having when we formulate policy that is the economy, energy and the economy are one and the same. So when we make policy involving energy, we're making economic policy and economic policy affects how all of us interact with the grocery store. Well also, you know, if we say we're going to electrify every car, every car is going to be a battery electric vehicle. And then you've got to re re conductor your grid. You're gonna have to add a lot more copper to that grid. In addition to the copper that goes in all these electric vehicles. Well, so, you know, that's, that's pretty scary. Yeah. And we need to move on because I know we're running short on time. But they hit in the history of mankind, we've mined 700 million tons of copper. And that goes back 6000 years. We still need to come up with another 880,000 tons. But and we need to do it by 2050, right? That's what 20 years. So but I also want to look at the where you've got the circle. Let's talk about actual mines. Yeah. So I mean, that's really, that's really stunning. Yeah. So my colleague, Simon, his PhD is in mining. And he spent decades in the mining industry. And so this is an important thing, because, you know, people, let's just go look for more economists go, well, we'll just go get more. We'll find more as if it's infinitely replaceable. And that's traditional economics. So a stat that he's come up with is that for every 1000 deposits you discovered, only one or two become mines. And the ones that do become mines take 20 years to develop. And then out of 10 out of the 10, so that so if you get 10 out of what 500 or 1000 discovery or 5000 deposits that you discover, you know, 20 to 30% go bankrupt. Right. So this is not as it's not as easy as just let's go dig up more. It's more complicated than that. Right. Well, let's have a look at the oil situation. We're coming down to the finish line here. Well, yeah. So with petroleum, which is really used for industrial transportation, that is a finite resource. And there's been a lot of discussion for many years about the fact that the amount that we use, which is now about 100 million barrels a day. Okay. So we're using 37 billion barrels a year. Wow. Right. So we're using over, you know, so in 30 years. So anyhow, it's a trillion barrels. And then they're just, we're using it at an incredible rate. So that's that's the flow rate of petroleum. So this company, which is one of the most respected, highly regarded energy analytical companies in the world, rice and energy in 2021 and 2022, determined that the recoverable reserves and when we say recoverable, that means economically and technically recoverable. I mean, if it costs $500 a barrel to recover oil, you're looking at a global recession or a depression. So you can't, the economics are really important. So what they're forecasting is that, and this is what's in the red, is that the global production of oil and natural gas liquids is going to contract by 50% by 2050. So that's in 26 years. Right. Okay. That we'll have half of what we have today. And that's the stuff that moves the global economy. It's, it is what moves things from China to the United States to India, everywhere around the world. So this is something that we need to consider too. What does this ultimately mean? Are we, we, I come to the conclusion that we're looking at it at an irreversible contraction in the in the economy, because there's just simply going to be less energy for many. We're running out of time. We're running out of time. So we can't be continuing to use fossil fuels. So we may, we may be forced into stopping in cutting back on fossil fuels because of the supply issue. So we need all those scientists to come up there and find some unobtainium to fuel our economy. But it could be a number of other things. But we're running out of time too. So I want to go quickly to the last slide, which is gives an idea. Just quickly, Peter, just show how. Yeah, very, very quickly. I mean, you look at the lower left or the lower right hand corner and essentially what this is a graph of is the transition time for traditional biomass, which is that large gray portion. And the darker gray is coal. And then you have the rise of oil and you have a timeline running along the lower, lower portion. But basically the purpose of this slide is to go energy transitions. Take a long time at the transitions that we're looking at here took place when the global population was a billion, billion and a half people were over eight now. So making that transition is, is it a reasonable expectation? Is it a reasonable goal that we can tell ourselves after we got discovered? So these are questions I want to ask. And I think they are very relevant when it comes to formulating our public policy. Absolutely. So anyway, we've run out of time on the show. And this is really a fascinating set of information that you gave us, Peter. So thank you so much. And I know you worked like all week putting this together. So it was really nice, really good of you to do it. I think we have enough material to maybe come back and have a round two, but we can kind of zero in on one or two specific areas. What we do is important. You know, we got to figure out what to do. What do we do now? Exactly. What's next? So we'll have to leave it there. As I said, we're running, we've run out of time. So we've been watching Hawaii, The State of Clean Energy on Big Tech, Hawaii. We've been talking history about our story about our global energy reality. We've been looking at reality on this show and its implications for humanity. And I wish we had lots of good solutions. With Peter Sternlich, who has shared his insights on this important topic. So thank you so much, Peter. I really appreciate it. And thanks to our viewers for tuning in. I'm Michio and we'll be back in two weeks with another edition of Hawaii, The State of Clean Energy.