De-Carbonising The Industrial Sector - Carbon Capture - Part D

Carbon Capture & Storage (CCS) is an integral part of the decarbonisation story but this strategy has not been well understood or publicised till date. CCS has also been grossly underfunded in the past decade as compared to solar or wind power generation or electric vehicles. Per some estimates, solar power has attracted annual investments of around US$ 80 -120 billion or more per annum in the last decade - CCS on the other hand has been struggling to secure capital (<US$ 5 billion per annum). 

Understanding the big picture

Before we jump into what CCS is, what its challenges are and its applications, it would be advisable to take one step back and appreciate a fundamental concept of decarbonisation. 

To achieve decarbonisation or net zero society there are two fundamental approaches. In common nomenclature the two are expressed as (a) conservation or prevention techniques (b) sequestration or capture techniques. 

Solar or Wind generation are good examples of conservation techniques. With conservation or prevention techniques, power is generated from wind or solar assets without the emission of CO2 or GHGs. This is one critical technique towards de-carbonization. On the other hand, there are sequestration or capture techniques that attempt to capture the CO2 being emitted into the atmosphere. 

The world needs both prevention AND capture to achieve net zero. There is no path that suggests one technique can be used exclusively. Both have vital roles to play. 

Conservation techniques especially in power generation are competitive on $/ton of carbon basis largely due to the fall in solar and wind generation costs. The cost of carbon is calculated by swapping solar for coal fired generation, determining the cost of swapping coal to solar and working out how much CO2 has been saved over the life of the assets after the swap. For wind and solar, the costs to switch are negligible and at times even negative (cash accretive to swap coal to solar). 

However,  conservation costs ($/CO2) rise sharply for sectors that are hard to abate such as CO2 emissions from cement, airlines, shipping etc. The alternatives to prevent CO2 generation for these sectors is very expensive. There is where sequestration comes in. 

Sequestration has three buckets. (A) Natural sinks - forests are prime examples. Plants and trees use CO2 from the atmosphere as part of photosynthesis and emit oxygen (B) CCS which we shall evaluate in more detail (C) DAC or direct air capture. Similar to CCS but unlike CCS which is associated with a particular emitter of CO2 (e.g. coal fired plant), DAC is about capturing CO2 from the air directly. 

Sequestration as a technique may not be competitive where coal fired generation can be swapped for solar. However, as we move into reducing CO2 emissions from industry (e.g. cement) or harder to abate sectors like airlines, sequestration could be more competitive than conservation. 

Summary

To understand the full picture around decarbonisation always consider both conservation (reduces or eliminates CO2 emissions) and sequestration (captures CO2 emitted). These two approaches have different applications across the CO2 emitting world and are best used as complimentary techniques rather than competing ones.  

The graph below gives you a very good sense how the two techniques interplay. Also note the tighter range of cost uncertainty around conservation techniques as compared to sequestration. 

CCS - Carbon Capture (Step 1)

The first step in CCS is capturing carbon. Capturing CO2 from industrial plants and power stations has been ongoing and is not a brand new technique. The challenge this decade is to expand and scale up its applications across the world beyond natural gas processing plants and power generation. 

Two principal methods to capture CO2 are (a) physical separation (b) chemical absorption. There are other techniques as well which are evolving like the use of membranes. 

Chemical absorption uses solvents. Solvents absorb the CO2 from the flue gas (CO2 emitting stream) column. The solvent is then heated at high temperature in another column to release the CO2 and the solvent can then be re-used. A relatively mature technique, has been used in power plants in the US, steel projects, waste to energy facilities. Physical absorption is based on absorption or adsorption. Adsorption takes place via a solid like activated carbon. Absorption on the other hand takes place via a liquid surface like solvents. After the CO2 has been captured, it is released separately via heat, pressure or vacuum. Physical separation has been used in natural gas processing plants, ethanol, methanol production facilities and is mostly used in the US. 

The appropriate technique used to capture CO2 depends on:

- Initial CO2 concentration: the higher the CO2 concentration, the easier to capture and more cost effective

- Final desired CO2 emission levels: as the target capture rates are higher naturally the cost increases 

- Temperature and pressure requirements and availability 

- Cost considerations : one of the key cost consideration is CO2 concentration levels. If the CO2 levels are high to begin with then it becomes economical and cost effective of a $ per CO2 captured basis. Thats why CCS has mostly been used in natural gas processing plants as of now where CO2 concentration is very high. It also explains why direct air capture (DAC) of CO2 from the air is so expensive as CO2 concentration in the air is very low. The graph below shows the cost of CO2 capture as depicted by IEA. 

That is why CCS is actively used in gas processing plants or ethanol production. Look at the $/ton cost to capture CO2 directly from the air in comparison.  

- flow rates of flue gas that contains the CO2 and finally 

- integration of the CCS with the source of emissions 

CCS - CO2 transport (Step 2)

Transport is the next step after capturing CO2. The captured CO2 needs to be transported to a safe and secure location for long term storage. Without transport CCS fails. The prime mode of transporting CO2 is pipelines although ships, trains and trucks can also be considered. As of now the cheapest mode remains pipelines especially when final storage location is onshore. North America where CCS is most common, benefits from the extensive pipeline network that exists for transporting CO2. 

Transport costs can be around 25% of the total cost. The cost depends a lot on how much CO2 is to be transported, the distance, size of the pipelines, pressure & moisture content requirements. The cheapest of course is to repurpose existing oil & gas pipelines subject to HSE parameters. If the final storage location is an offshore structure then transport cost goes much higher. Offshore adds considerable complexities to CCS operations and ships might have to be used in place of pipelines if distances are too great. 

The U in CCS? (Step 3)

Sometimes CCS is referred to as CCUS. The U stands for utilisation, i.e. utilisation of CO2 that has been captured and transported. Around 230-250 million tons of CO2 is used by industry today (world emits around 35 billion tons of CO2 per annum). The two primary applications of CO2 are (i) manufacture of Urea where CO2 is used as a feedstock (ii) Enhanced Oil Recovery (EOR) 

[https://en.wikipedia.org/wiki/Enhanced_oil_recovery#:~:text=Enhanced%20oil%20recovery%20(abbreviated%20EOR,using%20primary%20and%20secondary%20recovery.]  

where CO2 is injected into existing oil & gas production sites to enhance the recovery of hydrocarbons. 

The other potential applications for CO2 in the future could include synthetic fuels like methanol, production of chemicals and use of CO2 in building materials. All these are relatively untried and untested and it would be hard to provide an estimate on the usage potential for CO2 in these applications. 

Use of CO2 is a vital factor from a cost perspective. If the captured CO2 finds a use then the cost of CCS drops. However, usage of CO2 needs to be carefully considered. Otherwise it may result in captured CO2 being returned back to the atmosphere thus defeating the purpose of CCS. To this effect EOR and the building materials sector are attractive as CO2 remains captured for a very long time. Use of CO2 as a synthetic fuel much less so as the captured CO2 gets released back upon combustion of the synthetic fuel. 

CCS - Storage - (Step 3)

After CO2 is captured and transported comes the final stage which is CO2 must be stored securely to prevent CO2 being released back into the atmosphere. We did discuss some uses of CO2 earlier. If there is a use for the captured CO2 then its great but if not it must be stored. 

Storage involves injecting the CO2 into deep underground formations that meet the stated requirements of a porous rock where the CO2 can be housed and a impermeable layer of rock which provides the seal to prevent the CO2 from escaping. The two most preferred formations are (i) saline formations - porous rock with saline water acting as a seal and (ii) depleted oil & gas reservoirs as they previously have stored hydrocarbons in a porous rock with an impermeable rock layer on top. Gas reservoirs (low CO2 reservoirs) are especially preferred.  As EOR is now fairly common, storing CO2 in depleted fields is well established and proven. 

Storage sites are not expected to be the constraint for CCS. As per the IEA, storage capacity as of today ranges between 8,000 giga tons to 55,000 giga tons. Geographically North America, Russia and Africa have the highest storage potential. Onshore storage will be preferred to offshore as the costs to transport and store is much lower. To set the storage capacity in perspective, the IEA estimates the lowest bound of storage capacity is 8,000 giga tons whereas the total cumulative CO2 capture via CCS from 2020 to 2070 is 220 giga tons under IEA's decarbonisation / net zero scenario.

Risk of leakage of CO2 has been playing on the minds of many CCS skpetics. However, there is a long history of injecting and storing CO2 safely and securely. 

From a cost perspective, the cost of storing CO2 is much lower than capturing or transporting CO2. Cost of storage is based on methods of injections, location of the site and storage characteristics. If CO2 is being used for EOR purposes then costs can be offset via higher production of hydrocarbons. Onshore storage in the US could be below $10/ton of CO2 stored for nearly 60% of the sites. 

CCS Challenges

CCS has faced underinvestment in the past decade. CCS projects received very little funding hence the technology remained sub scale as compared to solar or wind power generation. A section of environmentalists have attacked CCS since it does not prevent the use of hydrocarbons but focusses on capturing CO2 hence does not encourage a pivot away from hydrocarbons. As CO2 gets used as EOR projects, the complaint is using CO2 for EOR results in more hydrocarbon recovery thus the solution is facilitating more hydrocarbon usage. 

Capturing CO2, i.e. step 1 is the hardest and costliest. CO2 capture needs energy which adds to costs and CO2 being emitted in the process. Transporting CO2 is not easy and may require new pipelines or re-tooling existing ones.

Despite these challenges, CCS is expected to become front and centre of decarbonisation strategies this coming decade. In part E we shall look at the trends and changes to CCS that are expected to impact it this coming decade.  

The Rare Metals War - Guillaume Pitron

The Rare Metals War is a recently published book in 2020 by investigative journalist and author Guillaume Pitron. The book revolves around Rare Earth Metals (which we shall discuss in a bit below), the darker side of clean energy and digital technologies and new geo-politcal issues around concentration risk and supply chains. According to Guillaume, rare earth metals sit at the very cross-roads of clean energy, technology and the upcoming China v/s the Western World geopolitical fight. 

We should start by examining what are rare earths / rare metals (RE). RE's are a group of metals that are not as rare as the word suggests. In total RE metals are seventeen in number also called Lanthanides.They are found in moderate quantities but largely in association with abundant minerals like iron and are hard to extract and refine. There are very few standalone RE mines like copper or iron ore mines for instance. RE are soft, malleable, solid, iron/silver grey in colour and highly reactive at high temperatures. RE uses are varied and find application in super alloys, catalysts, industrial applications, batteries but most importantly in high performance magnets in the technology space.

As the world pushes to decarbonise, there is a greater emphasis on electrification. The world is pushing to replace hydrocarbon combustion with electricity. Magnets therefore find massive applications ranging from motors used in Electric Vehicles (EV)s, wind turbines and in smart devices like handphones. 

The world is on the cusp of another industrial revolution. As the book argues, the first great shift occured with the use of coal by England resulting in the steam engine. This enabled the prime mover to move away from animals and humans to a natural resource (coal) and boost productivity. Coal was followed by oil & natural gas which further enhanced productivity and radically upended our lives. However, given the environmental impact of hydrocarbons, the world is once again moving to another revolution which is the confluence of clean energy and high technology. 

The country that dominates the production, extraction, refining and consumption of RE is not England or Europe or the US but is China. China has achieved scale in RE mining and production. Production of RE is environmentally challenging as it involves crushing a large amount of source rock, then refining the same using acids and purifying using copious amounts of water. Some RE mines have radioactive Thorium and Uranium as by-products making disposal tricky for the mine owners. Despite the challenges of extracting RE, their use and demand continues to grow and China exhibits a vice like grip over them. 

The Dark Side of Green & Digital Technologies

Chapter 2 is a critical chapter in this book and a must read. This chapter highlights a key learning to consider whilst evaluating current v/s future technologies whether its clean power generation, smart grids or EVs. 

Taking EVs as an example, it is unarguable that EVs are way cleaner than gasoline cars due to the absence of hydrocarbon combustion. However, it is important to peel away the layers to get a holistic perspective. EVs are driven by batteries that require cobalt, copper, lithium, aluminium, nickel, manganese, graphite etc. They also have an electrical motor that needs copper windings and RE magnets. As a consequence, an EV requires a lot more metal than an gasoline car although over a lifetime it still beats the gasoline car due to the absence of hydrocarbon combustion. 

The key takeaways from this chapter would therefore be the importance of end to end analysis of new age products. It is not sufficient to consider the emissions impact from the point of purchase only but to consider the entire product lifecycle from manufacture to use and also disposal. 

Likewise, a lot of renewable power generation like wind turbines and solar panels need significant amount of minerals plus steel and concrete as compared to the more traditional generation sources like natural gas fired plants. What therefore should be avoided is replacing emissions in urban settings and increasing emissions and ecological issues in key mining locations. Finally the impact of recycling should be considered in sufficient detail. Whilst recycling is fundamental and efforts to enhance recycling rates are to be lauded, recycling can become energy intensive especially when it comes to trace elements like RE. 

China and RE

China was not the leader in RE. America, Australia, the EU and Japan were leaders in the extraction, refining and consumption of RE for a long while (China's market share then was below 10%). But by the 80s and definitely by the 90s the winds of industrialisation began to change and China gained ascendency. Guillaume elaborates why this happened and a number of factors come into play to explain this.

Firstly, environmental norms in the West & Japan started to tighten up considerably. Mountain Pass, the then largest RE mine in the world and located in the US faced considerable headwinds from environmental issues. This impacted profitability and the operations of the mine.

On the other hand, China in 80s and 90s was keen to rapidly industrialise. China made forays into RE mining, building scale and turning a blind eye to the environmental aspects of RE mining. As a result RE prices in China fell and ex China mining of RE shuttered including in the US, France and Australia. 

This was actually welcomed by the West at that time who felt that it was a masterstroke to 'export' polluting industries to the global South like China and maintain a clean environment at home. 

With the advent of globalisations, supply chains went global. End consumers cared little where the products originated from and where basic heavy industries were located. There was greater focus on lean supply chains and efficiency from a cost perspective rather than the origin of goods or resilience of supply chains. All this seemed like a win win situation which could only get better. 

However, things turned out a bit differently!

From Dominance To Power Projection 

After consolidating production, enhancing supply chains and capturing more of the value add, China felt confident to assert its domination over key raw materials. First it established export quotas that reduced RE exports year on year thus curbing non Chinese consumtpion and encouraging consumption at home. 

Then came the infamous incident with RE and Japan in 2010 that put the world on notice. Because of a dispute with Japan linked to fishing and ownership of the Senkaku islands in 2010, China 'cut off' RE deliveries to Japan. Japan which was heavily dependent on RE imports from China was hugely impacted. RE prices sky rocketed in the global market. The US, EU and Japan filed WTO complaints against China. Years later the embargo by the Chinese was termed illegal but the damage had been done. With a RE market share of more than 90%, China had an oversized hand to play when it came to RE. 

The US, EU and Japan commissioned detailed studies on their import vulnerabilities with respect to critical minerals. All these countries concluded that China plays a vital role in the supply chains in many minerals (not just RE) which is a cause of deep concern for all of them. Since the 2010, various attempts have been made to establish RE mining and refining outside of China but it has been met with muted success. The ability to decouple and establish a supply chain for RE independent of China has not yet fully materialised. 

As of today whilst RE mining has restarted in the US and Australia, China still has more than 60% market share for RE mining. More impressively its market share for refining and processing RE stands at around 85%! This is a decade after the west and Japan decided that supply chains for RE were overly concentrated in China. 

Not Pausing At Mining & Refining

A defining feature of China's dominance in RE has been its ability to develop and master the world beyond just RE mining and refining. As the book demonstrates, export bans and quotas have been adopted by many countries around the world. Yet few countries, if any, have developed expertise across the value chain for the respective mineral. 

China on the other hand has developed the same and the world of high performance magnets brings us to the next pivotal moment in China's quest for domination. Whilst the west was focussed on reducing polluting industries at home and driving down costs, China was focussed on upping the ante in high tech manufacturing. 

The origins of China's march towards manufacturing dominance and technological upgrades is captured in their five year planning policy documents. These planning documents set the targets and the stage which in turn provides the impetus for Chinese companies, including the SOEs, to set their own goals and aspirations. Many of these policy documents have focussed on the importance of RE mining but also the need to go beyond just mining and refining RE. 

The Magnequench saga best exemplifies how this approach unfolds on the ground with the Chinese making a concerted effort to secure patents, know how and knowledge in the high tech magnet world. RE play a pivotal role in the manufacture of high tech magnets which in turn drives the digital and new energy world. 

In 1995, the Chinese state in conjunction with Chinese SOEs made a bid for Magnequench, a leading cutting edge magnet manufacturer, with sole aim to understand the technology behind high tech magnets. High tech magnets are fundamental to the digital world and the new energy space and mastering high tech magnets allows a country to dominate these key sectors. This is exactly what happened. Five years after securing the approval (heavily contested acquisition processes) to acquire the company, Magnequench's operations were terminated in the US and the factories were entirely relocated to China.

Fast forward a decade or so, the leading manufacturer and exporter of high tech magnets is no longer the US or its erstwhile competitor Japan but is China. China does not lead, it dominates! This domination is so  impressive that the US F-35 fighter jet program had to seek exemptions to buy and use Chinese magnets as no other alternative was possible! 

Looking Beyond RE

Whilst this book is centred around RE, the lessons and observations can be extended to a number of other minerals and the manufacturing sector as a whole. The US and Western countries have essentially hollowed out their manufacturing and mining capabilities. With a confident but erroneous belief that one can sustain purely on innovation, the US and the West have surrendered large swathes of territory to China. 

China on the other hand is relentless. It has exploited this chasm to perfection. Commencing from the position of a benign, low cost responsible producer of goods for the world, it has steadily moved up the ranks of research, innovation and quality whilst continuing to build scale across industries. This has now put China as a clear threat to the US domination of future technologies. Using its vast manufacturing base, trained staff, state support, immense funding of R&D and a determined will, China has put the US and the world at large on notice. 

With Make in China 2025 personifying the grand ambitions of the Middle Kingdom, the country aims to become a global manufacturing, cyber and science and technology superpower. I don't think any further explanation is needed to this statement. The target date is 2049 - a 100 years since the establishment of the People's Republic of China. 

Conclusions 

The book makes for interesting reading as it focusses on two key issues namely the metal and mineral intensity of new age energy solutions and the dominance of China across the very vital supply chains that will enable this transition. More importantly, the lessons from the evolution of the RE industry can be applied to a number of sectors and I am confident the conclusions will largely be the same. 

The greater questions are will China achieve its vision as set out in Make in China 2025? Has COVID changed the dynamic in favour or against China? What steps can the US and the West take to counter China? Will the great decoupling take place or will it be stymied by factors of cost, inertia and efficiency. Will the US led liberal rules based order hold in the coming decades or will we witness some cataclysmic shifts in this regard? Who will lead the next digital, energy and industrial revolution? 

Despite all the uncertainty and the high stakes involved, one thing is certain. Understanding the US and China and their relationship will be fundamental in the coming decade. 

https://www.amazon.com/Rare-Metals-War-Digital-Technologies/dp/1950354318

My Book Review Event 

Brow Sing - a book and knowledge enthusiast club asked me to review this book in Jan 2022. Below are the slides that formed part of this book review. 

The book review had two critical themes.

A. The importance of metals and minerals in energy transition. Whilst the above book is focussed on rare earths, I expanded the discussion for the audience to cover other metals such as copper, zinc, lithium, cobalt amongst others.

B. The dominance of China in supply chains. China has assumed a very dominant position across the entire value chain of the low carbon industry. Beyond just mining RE, China has focussed on developing scale and market shares across all key minerals needed for energy transition. In addition, the country has build up capabilities in EV and battery manufacturing and wind turbines and solar panels. What is the impact of the same and how will it affect the rest of the world as tensions rise but the pivot to low carbon accelerates? These were questions, we attempted to answer. 

Attached are the slides below.

Link to slide deck

To Rule the Waves - Bruce D. Jones

To Rule the Waves is a book written by Bruce D Jones, a senior fellow at The Brookings Institution. The book illuminates how the control of the world's oceans shapes the fates of the superpowers. Bruce directs the Project on International Order and Strategy of the Foreign Policy Program at Brookings and is therefore optimally placed to write about maritime strategies, world order and the power of nations. The book has been published by Simon & Schuster, Inc in 2021 and hence provides a very updated insight into some of the most critical issues such as the South China Sea militarisation which directly affects us living in Asia. 

The book has four parts that are closely linked with each other. It commences by giving readers a glimpse into the vastness of the sea borne trade and the importance of oceans to the power & wealth of nations and ends with challenges including that of climate change and demonstrating the importance of oceans vis-a-vis the climate discussion. 

The oceans are not just an empty bottomless abyss but a thriving ecosystem where control of strategic locations is as vital and in many cases more vital than strategic locations on land. Since 1492 and 1498 when Columbus discovered the New World and Vasco de Gamma discovered the sea route via the Cape of Good Hope to India; the world changed and the control of oceans became paramount for wealth and power [my views]. 

The rise of sea or maritime power has been on a continuos ascendency. The book shares insights into how this phenomenon evolved, first with the Portuguese who were closely followed by the Spanish and then by the Dutch, French and finally the British. By the turn of the 20th century, the British had become the pre-dominant power in the world on the back of the Royal Navy which operated a blue water navy across the entire world. After WW2, the Americans would follow suit in the tradition of the Royal Navy and develop the finest Navy the world has ever seen. 

The book shares important but critical insights especially into the workings of the United States which is the preeminent power in the world. Unlike the common perception of national borders being the first line of defence of a country, national borders are infact the last line of defence for the United States. Lets introduce here Alfred Thayer Mahan - the brilliant naval strategist of the US and author of a pivotal book "Influence of Sea Power Upon History" written in the late 1800s which has shaped much of the doctrine of the United States' navy and a book that offers a deep insight into the workings of a blue water navy.  

Mahan's critical concept being the wealth and prosperity of a nation is linked to (a) a strong and powerful merchant fleet to carry goods & merchandise across the world (b) an unmatched navy to protect the merchant fleet and keep the sea lanes open for trade and commerce (c) forward projection of power, far away from the country's national borders, via a series of mutually reinforcing forward bases. For the best example of the last point, the reader is advised to open a map of the Pacific ocean and plot the US bases from San Diego all the way to South Korea and the concept becomes all too apparent. 

Containerisation & Twenty Foot Equivalent Units (TEU). The development of the container shipping phenomenon and the growth of sea borne trade has been in lock step. Since the commencement of the container industry in the 1960s this industry has grown by leaps and bounds and has transformed the way we consume goods. The graph below (World Bank) shows the incredible rise of container shipping as measured in TEU units over the past few decades coinciding with the rise of China and the Western Pacific.

Growth in world containerisation measured in TEU 

East Asian economies now dominate the sea borne trade with massive manufacturing hubs dotting the Western Pacific. The largest ports used to American ports and some western European ports in 1960s. Now all the largest ports in the world unsurprisingly are in East Asia with Shanghai ranked 1 and Singapore following close behind demonstrating how the axis has shifted to the Pacific.  https://www.worldshipping.org/top-50-ports 

Shanghai and the other Chinese ports are truly breathtaking in size and complexity. The author talks about his visit to Yangshan Port in Shanghai and shares valuable insights into the development of this super critical world trade port. I was fortunate to have visited Port Waigaoqiao in Shanghai in 2010 and below are some pictures from that visit which I have taken the liberty to share. 

Copper Cathodes Stored in Shanghai Port Free Trade Zone

Chinese port workers weighing the copper

Thats me in front of a large pile of Copper in the port

China, Singapore and South Korea now have the most integrated shipping networks in the world and their companies dominate sea borne commerce and trade. The Chapters - To Contain the World share deep insights including the rise of some iconic shipping companies like Maersk and OOCL which played a critical role in the development of container shipping industry which in turn changed the world we live in. As the industry has grown and developed, so have the ships that carry this massive volume of trade. The early container ships in the 60s had a capacity ranging between 1,000 - 3,000 TEUs. Today the largest container ship has a size of c. 24,000 TEU, not surprisingly owned by the Taiwanese shipping line Evergreen. 

The Flag Follows the Trade - The US navy, as mentioned above, enjoys unmatched supremacy and controls the world's seas and oceans. Through a combination of large military budgets, cutting edge technologies, mutually reinforcing forward bases and a world wide alliance with other leading nations of the world, the US has secured a pivotal role in controlling the seas and ensuring freedom of navigation and the free flow of trade. 

Enter China!! Since the early 2000s, on the back of incredible economic growth, China has come a new power to challenge the presence of the US. China has embarked on a spree to upgrade and modernise its armed forces and notably its navy. Export of finished goods is critical to China as is the import of raw materials and energy and this is a key vulnerability for the country as all this takes place via sea lanes. China recognised that in a clash with the US it would suffer immeasurably as the US navy controls the water all around China. The US could literally 'choke' China if matters came to a head. 

This prompted China to upgrade its naval capabilities and it started to gain knowledge and confidence first with anti piracy operations far from its own territorial waters. Since then, the rise of the PLAN has put the world in general and the US in particular on notice. This section of the book will chronicle key strategies adopted by the Chinese and US in the control of the sea lanes around China and the Western Pacific. Bruce has shared some very interesting insights and perspectives which make for fascinating reading.   

The Power of the Seas - We maybe lulled into believing that as we continue to make progress it will be the world of high tech that will dominate societies and will be more critical than the transshipment of goods on the high seas. Even if we did subscribe to this notion (which is rather flawed) we cannot forget that more than 90% of the data in the world in carried via undersea cables! The seas and oceans are now even more vital in the data driven, cyber economy and hence protecting this vital infrastructure is paramount. 

The seas and oceans are also an incredible source of sustenance as well. A large percentage of the world's population relies on fish and sea food as a critical source for its dietary needs. Then there are the mineral riches from the seas from oil to natural gas production. All this makes for even heightened control & competition for the seas and oceans. [for more deeper insights into the development of the offshore oil industry my suggestion would be to read the book The Prize by Daniel Yergin]. 

One also cannot ignore the role of water, seas and oceans when it comes to our climate. Through sustained research initially carried out by the UK and US but now by most leading nations of the world, we have come to understand the importance of the oceans in the area of climate. Oceans, currents, temperature differences, ice caps, the inter play between oceans and winds all play a vital role in our evolving climate systems. Further, the incredible ability of the oceans to absorb heat has led to further research around oceans, climate change and global warming. 

"Once oceans were the boundary of our existence; now they are the front lines of the new rivalries that will shape the twenty - first century". This sentence aptly summarises the essence of this excellent book. Will the oceans and the Pacific in particular become a hostile and hotly contested fault line or will seas and oceans continue to further trade, innovation and connections is a question for all of us to debate. Finally, we know so little about the oceans despite they being front and center of our existence. Hence, is it time for the major powers to bury their differences and instead work on transnational issues and better understand and respect the seas and oceans around us? To get some of these answers and better shape your opinions, do buy and read this book!

https://www.amazon.com/Rule-Waves-Control-Determines-Superpowers/dp/1982127252

    

The New Map by Daniel Yergin

The New Map by Daniel Yergin is a book on Energy, Climate and the Clash of Nations. The book has been recently published in 2020 by Penguin Random House and covers the fascinating intersection of energy, energy transition, the intersection of the Big Three - the US, Russia and China, geopolitics and  technology. Daniel Yergin is a Pulitzer Prize winning author and expert on the Energy Industry. This is third book of Daniel that I have read besides The Prize - A phenomenally interesting book and The Quest, a book I found much less engaging than the Prize. Daniel is also the Vice Chair at IHS Markit, one of the world's most established energy research houses, a senior trustee at Brookings Institute and has been closely associated with US Energy Policies across both Democrat and Republican administrations. 

The initial few chapters are devoted to the Big Three and their respective energy and geopolitical maps. 

For the US the key theme is the emergence of Shale Oil and Gas and the ability of the US and North American continent to become a major energy player and exporter, something that was unthinkable a few decades ago. The role of innovation, determination, burgeoning private sector and deep financial markets demonstrates how a country can radically transform its bargaining position and disrupt an established order namely OPEC to its advantage. The Shale revolution gave the US a fantastic set of cards to play with that have wide reaching consequences for the rest of the world.  

Energy and Russia have been inextricably linked for more than a century now. One of the largest energy producers, the Russian State and the energy industry are closely intertwined and lines are blurred between the use of energy to secure economic gains or score political wins. Russia's dominant energy position has enabled it to play an outsized role in impacting European and Middle Eastern political and economic systems and now increasingly in Asia as it pivots to new markets to counterbalance a dependence on Europe for selling its energy. 

And there is China. Whilst the US and Russia have been energy and geopolitical heavyweights for generations, there is the new elephant (or dragon) in the room and that is China. With its meteoric rise driven by a hyper scaled manufacturing base, essentially the workshop of the world, China has an outsized role in modern energy markets. Along with that comes the paranoia of being a massive energy importer as energy is fundamental to its development and establishment as a key geopolitical power. Chapters cover the key energy choke points, South China Sea, Belt and Road Initiative, China Trade and Commerce and the rise of Chinese nationalism, self confidence and modernisation impact of its armed forces.   

When we think of maps and energy our minds are immediately drawn to the Middle East. The book devotes considerable pages towards the historical settings that created the modern Middle Eastern map. The book covers all the key issues namely, Iran, Iraq, the house of Saudi Arabia, Gulf Wars, Arab Nationalism, Islamic Fundamentalism, Arab Spring Revolutions, Proxy Wars including the Sunni Shia divide, Syria, Libya, Yemen, Eastern Med and their future in a world that is less oil dependent. Considerable detail has been spent trying to provide the reader with valuable insight and context into very important considerations that shape a key energy region which is highly unstable and subject to rapidly changing developments. 

The map of energy has to include the map of the future. The primary demand for oil is transportation hence understanding the evolution of the EV market is fundamental. Three key forces are discussed including electrification of the car (rise of Tesla etc), self driving cars and 'servicization' of the car due to the likes of Uber via technology.  

The book ends appropriately with the 'Climate Map'. A super critical chapter on a pressing issue namely the Climate Crisis. As we push for more energy to grow our economies we need to balance that with the danger of GHG emissions and the impact on climate. The demand for electricity will continue to rise and with that pressure to switch from coal to gas to renewables. These forces are swiftly unfolding as I write this review and every country is working towards growing its power generation base but increasing renewables in the power mix. To compound matters, there is a huge divide between developed and developing countries when it comes to the energy transition with valid arguments on both divides. 

The book is a spectacular read and covers all the key issues that impact the world today in particular the energy world. The book has gone into sufficient detail across many key developments and provided the appropriate historical and political contexts. This is vital as the energy world as we see it today is not just a function of the energy industry but has immensely been shaped by the arc of history and geopolitics. The next stop is to go the IHS Markit portal and download the articles that are referenced across the book to get a more complete picture. Daniel Yergin has once again demonstrated excellent knowledge of this industry and the book I dare say is a must read!

https://www.amazon.com/New-Map-Energy-Climate-Nations/dp/B086DLRRLT

How To Avoid A Climate Disaster

 

How To Avoid A Climate Disaster is the latest book by Bill Gates. The book was published recently in 2021 by Penguin Random House and as the title suggests, the book is about Climate Change and ways to tackle this problem. The book is dedicated to scientists, innovators and activists who are the leading the charge on Climate Change. The author, Bill Gates needs no introductions here, as he is one of the finest and smartest innovators and entrepreneurs the world has ever known. 

Netflix has a documentary series on Bill Gates, Inside Bill’s Brain : Decoding Bill Gates. I enjoyed this documentary as much which is in three parts and gives excellent insights into the person we know as founder of Microsoft. Its a three part documentary series, with the last part devoted to his work on Climate Change so watch it if you have a subscription to Netflix. 

As Climate Change has become a front and center issue that is impacting the world and mankind, I have taken the liberty to capitalise the words ‘Climate Change’ in this review. 

The book provides a very succinct and impactful way for most people to understand and appreciate this problem of ‘Climate Change’. Bill’s book also demonstrates how complex this problem is and highlights that multiple approaches are needed to tackle the issue of Climate Change and carbon emissions. I would say whilst I have more than a rudimentary understanding of the energy industry, fossil fuels, carbon emissions and Climate Change, I found the book useful and very well organised. 

To set the stage, Bill uses a binary concept. Binary concepts I guess come naturally to people in the world of technology. The binary here is 51 Billion and Zero. 51 Billion Tons are the annual emission of Greenhouse gases and zero is the target for mankind to ensure we can preserve planet Earth. This book talks about the path from 51 billion to zero and the challenges that come along the way. 

The fossil fuel industry is all pervasive and carbon emission has been a by-product of the steep development of mankind since the advent of the industrial revolution. In today’s world, fossil fuels have been badly maligned and maybe for some good reasons. But for people reading this review, they need to bear in mind that this explosive growth in human lifestyle, comfort and the uplifting of billions of people out of abject poverty has been a direct consequence of man’s ability to harness the energy from below the earth’s surface. 

However, we are now at a very clear cross road in human development. Continued emission of carbon will endanger the planet. I am not climate scientist and neither is Bill (he states that clearly in his book) but the overwhelming view of the scientific community is that Climate Change and carbon emissions are directly linked and we are on a non - sustainable path. Getting to zero and within a few decades is imperative and this is the core of the book. 

Carbon is being emitted all around us. At times, we are consciously aware when carbon is being emitted but in most cases, we are completely oblivious to this. To set the stage, define the problem and establish clear thought provoking buckets in the mind of the reader, the book has classified five areas that constitute key carbon emission clusters. A chapter has been dedicated to each of these namely (i) generation of electricity (ii) manufacturing of goods especially heavy industry (iii) agriculture (iv) mobility and transportation (v) heating and cooling of homes, offices and other buildings. 

Once the book has identified the key determinants of carbon emission, it focusses on potential solutions. I wont get into the specifics as it would be better to get that by reading the book. Some of the key conclusions are; its not going to be a single solution that will get us to zero. We have to tackle this problem from all angles with multiple minds and inter disciplinary best practices. This I feel is a very enlightened view to solving this problem. 

I have seen people suggesting ideas that seem to focus on a ‘home run’ approach. Unfortunately, the energy industry is not the technology industry where a ‘killer app’ that solves all problems, a one stop shop solution will just not work. For example, the future power generation grid needs to involve methods that don't generate carbon like solar but also involve carbon capture techniques for those that do emit carbon. Similarly, solutions need to encompass both centralised as well as decentralised power generation capability. And when it comes to power, Bill Gates has made the case for nuclear generation, which is a very controversial topic and elicits many polarised views from all quarters but the arguments made for it make it a worthy read. 

The book has also devoted chapters to adaptation strategies around a warmer world with a more severe climate and the importance of government regulation, involvement and encouragement. The role of governments (Federal, State, Local and City) cannot be deemphasised when it comes to tackling a monstrous problem like Climate Change. 

Can we get to zero is the big question? Is that possible? Can we be optimistic about it and in what time frame and what investment is needed to get there? The book does address each of these questions. Finally the book ends with a chapter on Covid and what are the learnings from Covid that can be transplanted when it comes to Climate Change. There are interesting parallels and lessons although on the surface it looks like there is not much in common between these two problems. 

Bill Gates has made a phenomenal impact on all our lives. Microsoft has become synonymous with technology and computers and has altered our lives permanently. The Bill and Melinda Gates Foundation is a path breaker in the world of philanthropy. So when a book is written by Bill Gates on a existential issue like Climate Change, I decided to read it. This is a good book no doubt. Its succinct, solution oriented and pragmatic. It also dispels a lot of myths and preconceived notions around Climate Change and gives the reader a more analytical and fact based framework to view the problem of Climate Change. Go ahead and read it! 

https://www.amazon.sg/How-Avoid-Climate-Disaster-Breakthroughs/dp/0385546130/ref=asc_df_0385546130/?tag=googleshoppin-22&linkCode=df0&hvadid=404206611278&hvpos=&hvnetw=g&hvrand=9350443596550045729&hvpone=&hvptwo=&hvqmt=&hvdev=c&hvdvcmdl=&hvlocint=&hvlocphy=9062526&hvtargid=pla-918137739254&psc=1