The Climate Change Discussion Thread

[SFUVancouver]

Originally Posted by MolsonExport

Which leaves Tesla very vulnerable once one of the Japanese car manufacturers goes all-in with EV production. Wouldn't it be great if Honda (Alliston) or Toyota (Woodstock) could leave ICEs behind?

But they're not doing this. At all. In fact, the most obstinate of all the legacy internal combustion engine car companies are Honda and Toyota. Toyota's announcement yesterday of a $3.4 billion investment by 2030 to build up its in-house battery production capacity is still predicated on using them primarily in hybrids. They both still plan to make hybrids the centrepiece of their "electrified" business strategies, and that means they will still be utilizing ICE vehicle architectures that they modify to accept a little battery pack and electric motor. Toyota's publicly stated position is that EVs are a threat to Japanese automotive manufacturing dominance and the solution is to push back against EV transition mandates and hold out hope that Hydrogen will miraculously leapfrog battery electric.

Tesla is building cars as fast as it can and selling every one; pre-selling them out to mid-2022! They're building manufacturing capacity as fast as they can, with Giga Austin and Giga Berlin coming online later this year and ramping to add approximately an additional million vehicles per year by end of 2022 for a company-wide capacity of about 2-2.5 million/year run-rate. The constraint is also battery supply. They're buying the plurality of the world's current lithium-ion car battery production from vendors and building their own battery factories as part of Giga Austin and Giga Berlin, plus the Cato Road 4680 "pilot" plant that will still currently be among the highest output cell manufacturing facilities with about 10 GWh annual production. They're also securing supply upstream, with contracts to buy up entire mines' lithium and nickel production.

By and large, until this year, the legacy OEMs assumed they could just buy from suppliers and didn't entertain moving into the production space themselves. Now that's changing, with VW, GM, and and Ford announcing tens of billions of investment in in-house cell manufacturing capacity, but that means the CAPEX is on their balance sheets as their deliveries plummet and they hemorrhage billions from the chip shortage. To meaningfully transition to majority EV production, not only will they need to secure as many batteries from third parties as possible, but they will need to figure out, and excel, in new areas of manufacturing for which they have no prior experience. They'll do it, most of them, but it's going to be awful.

Think what you want, and don't construe any of this as investment advice, but the legacy OEMs, arguably with the exception of VW, are paper tigers who still don't get it that they've entered the existential crisis phase of the transition to EVs. It's happening, they aren't ready, and they don't understand how hard or expensive it is going to be survive the decade and retain anything resembling their current market shares, valuations, and margins.

[Truenorth00]

Toyota has a chance with hybrids, if they were to hybridize every model they sell in the next 2-3 years. But even that only gets them to about 2035, when various ICEV bans are kicking in. And that's assuming that hybrids can even be competitive with VEVs at the $58/kWh Bloomberg is predicting in 2030.

To me, this is Toyota betting they can lobby their way out of these mandates and completely ignoring the strong possibility that cheaper batteries will completely upend their business model anyway.

[rofina]

Originally Posted by SFUVancouver

But they're not doing this. At all. In fact, the most obstinate of all the legacy internal combustion engine car companies are Honda and Toyota. Toyota's announcement yesterday of a $3.4 billion investment by 2030 to build up its in-house battery production capacity is still predicated on using them primarily in hybrids. They both still plan to make hybrids the centrepiece of their "electrified" business strategies, and that means they will still be utilizing ICE vehicle architectures that they modify to accept a little battery pack and electric motor. Toyota's publicly stated position is that EVs are a threat to Japanese automotive manufacturing dominance and the solution is to push back against EV transition mandates and hold out hope that Hydrogen will miraculously leapfrog battery electric.

Tesla is building cars as fast as it can and selling every one; pre-selling them out to mid-2022! They're building manufacturing capacity as fast as they can, with Giga Austin and Giga Berlin coming online later this year and ramping to add approximately an additional million vehicles per year by end of 2022 for a company-wide capacity of about 2-2.5 million/year run-rate. The constraint is also battery supply. They're buying the plurality of the world's current lithium-ion car battery production from vendors and building their own battery factories as part of Giga Austin and Giga Berlin, plus the Cato Road 4680 "pilot" plant that will still currently be among the highest output cell manufacturing facilities with about 10 GWh annual production. They're also securing supply upstream, with contracts to buy up entire mines' lithium and nickel production.

By and large, until this year, the legacy OEMs assumed they could just buy from suppliers and didn't entertain moving into the production space themselves. Now that's changing, with VW, GM, and and Ford announcing tens of billions of investment in in-house cell manufacturing capacity, but that means the CAPEX is on their balance sheets as their deliveries plummet and they hemorrhage billions from the chip shortage. To meaningfully transition to majority EV production, not only will they need to secure as many batteries from third parties as possible, but they will need to figure out, and excel, in new areas of manufacturing for which they have no prior experience. They'll do it, most of them, but it's going to be awful.

Think what you want, and don't construe any of this as investment advice, but the legacy OEMs, arguably with the exception of VW, are paper tigers who still don't get it that they've entered the existential crisis phase of the transition to EVs. It's happening, they aren't ready, and they don't understand how hard or expensive it is going to be survive the decade and retain anything resembling their current market shares, valuations, and margins.

Between yourself and Truenorth its been very interesting learning about the battery production constraints.

I can't imagine how severe these shortages would be should a legacy car maker actually want to move the amount of EV's that they now typically sell in ICE.

Tesla is obviously growing fast, but its still a tiny slice. If constraint is already an issue I can't imagine the growth in production necessary to accommodate the legacy makers that move tens of millions of vehicles a year.

Just from a very high level view, this strikes me as an incredible transition to make, particularly at a time when you have assurance that your competitor is looking for the same materials and same expertise.

[Truenorth00]

Tesla is aiming to be able to replace 1% of the global fleet per year by 2030. That's about 15-20M annually. About 20% of the global car market. Everybody laughed them off a few years back when they said this. It's becoming obvious now that they are serious. At least VW takes them seriously and is manoeuvring to keep up. The rest? Who knows.

I'll go with what auto consultant and teardown expert Sandy Munro says. If they can't have half their production as BEVs by 2028, their long term survival is in jeopardy. And right now, there are OEMs like Toyota not planning for this.

Nobody is yet taking the Chinese seriously. But the OEMs most at threat of a Chinese invasion are the Japanese and Korean automakers. I fully expect to see plenty of panicked announcements from Toyota and Honda in the next 18-24 months. Right now they are just watching to see what the competition doing. Should be noted that the chip shortage didn't really impact Chinese EVs much at all. Their sales still saw spectacular growth.

[Hackslack]

Especially with the significant increase in the cost of fuel… that being said, how will the significant increase in cost of energy affect the EV market for producing the vehicles, if at all? Surely the cost to extract material, manufacture batteries, and manufacture the vehicles entirely will be affected, but is it even something that would be of any significance to the price of the vehicle overall?

[DirectionNorth]

Originally Posted by Hackslack

Especially with the significant increase in the cost of fuel… that being said, how will the significant increase in cost of energy affect the EV market for producing the vehicles, if at all? Surely the cost to extract material, manufacture batteries, and manufacture the vehicles entirely will be affected, but is it even something that would be of any significance to the price of the vehicle overall?

Probably will be, but ICEVs also need energy to be manufactured - I don't see the effect in sales being that large.

[ssiguy]

Despite the northern Natives complaining about climate change and their constant talk about devine Mother Earth, Northern communities are the worst offenders when it comes to climate change action.

This is particularly true of Nunavut where 100% of their electrical power comes from diesel. The territory has no grid system and each community has it's own diesel plant which is not only highly polluting but also bloody expensive as the Nunavut also has no oil or NG production.

These northern and isolated Native communities are ripe for wind power but alas no. I guess these touchy-feely Natives are only concerned about climate change if it doesn't require them to be part of the solution but that hypocrisy is easily solved.......... just blame it on the dreaded white man.

[esquire]

Originally Posted by ssiguy

Despite the northern Natives complaining about climate change and their constant talk about devine Mother Earth, Northern communities are the worst offenders when it comes to climate change action.

This is particularly true of Nunavut where 100% of their electrical power comes from diesel. The territory has no grid system and each community has it's own diesel plant which is not only highly polluting but also bloody expensive as the Nunavut also has no oil or NG production.

These northern and isolated Native communities are ripe for wind power but alas no. I guess these touchy-feely Natives are only concerned about climate change if it doesn't require them to be part of the solution but that hypocrisy is easily solved.......... just blame it on the dreaded white man.

You have got to be kidding... you think they just snap their fingers and a wind farm suddenly materializes?

[Psychedelic Sailor]

Originally Posted by ssiguy

Despite the northern Natives complaining about climate change and their constant talk about devine Mother Earth, Northern communities are the worst offenders when it comes to climate change action.

This is particularly true of Nunavut where 100% of their electrical power comes from diesel. The territory has no grid system and each community has it's own diesel plant which is not only highly polluting but also bloody expensive as the Nunavut also has no oil or NG production.

These northern and isolated Native communities are ripe for wind power but alas no. I guess these touchy-feely Natives are only concerned about climate change if it doesn't require them to be part of the solution but that hypocrisy is easily solved.......... just blame it on the dreaded white man.

This is at best dishonest

[Truenorth00]

Originally Posted by esquire

You have got to be kidding... you think they just snap their fingers and a wind farm suddenly materializes?

Originally Posted by Psychedelic Sailor

This is at best dishonest

Have you seen his post history? Random bigotry and xenophobia is to be expected.

That said, the feds did include funding and a committment to get all Indigeneous communities off diesel power by 2030, using renewables. And the communities seem to be embracing the renewables wave.

https://www.macleans.ca/economy/busi...s-communities/

Also, broadly in my experience, they seem to be massive investors in renewables. Hosting solar and wind farms and energy storage sites. This is from 2017:

An increasing number of Indigenous communities are becoming partners in renewable energy projects in Canada and creating thousands of jobs as they do it.

A new national survey shows nearly one fifth of the country's power is provided by facilities fully or partly owned and run by Indigenous communities.

It represents a dramatic increase in the last decade in renewable energy projects like hydro, wind and solar power.

The author of the report, Chris Henderson, says the real surprise for him is the amount of employment that clean power is creating — 15,300 direct jobs for Indigenous workers who have earned $842 million in employment income in the last eight years.

"That is a huge number, because if you have a job you are contributing to the economy, it's a real job, it's honest work," he said in an interview with CBC News. "The number of jobs created is the story of how our country is changing and how Indigenous people are part of a clean energy future."

There are now 152 medium to large renewable energy projects with Indigenous involvement. That's up from approximately 20 projects in 2008.

Each medium to large project generates electricity for at least 400 to 500 homes.

There are also another 1,200 smaller projects built with Indigenous participation that generate electricity for local communities.

https://www.cbc.ca/news/politics/fir...ects-1.4348595

[Architype]

Originally Posted by ssiguy

Despite the northern Natives complaining about climate change and their constant talk about devine Mother Earth, Northern communities are the worst offenders when it comes to climate change action.

This is particularly true of Nunavut where 100% of their electrical power comes from diesel. The territory has no grid system and each community has it's own diesel plant which is not only highly polluting but also bloody expensive as the Nunavut also has no oil or NG production.

These northern and isolated Native communities are ripe for wind power but alas no. I guess these touchy-feely Natives are only concerned about climate change if it doesn't require them to be part of the solution but that hypocrisy is easily solved.......... just blame it on the dreaded white man.

Old man yells at cloud. This is the danger of seeing too much division in society, we are all a part of this, there is no need to ignore practically every other factor involved.

[scumtoes]

Originally Posted by Truenorth00

Have you seen his post history? Random bigotry and xenophobia is to be expected.

That said, the feds did include funding and a committment to get all Indigeneous communities off diesel power by 2030, using renewables. And the communities seem to be embracing the renewables wave.

https://www.macleans.ca/economy/busi...s-communities/

Also, broadly in my experience, they seem to be massive investors in renewables. Hosting solar and wind farms and energy storage sites.

https://www.cbc.ca/news/politics/fir...ects-1.4348595

Nuclear SMRs seem to be the best alterative to O&G for the north and remote locations in Canada. Renewables have seemed to prove themselves ineffective and unreliable.

[Truenorth00]

Originally Posted by scumtoes

Nuclear SMRs seem to be the best alterative to O&G for the north and remote locations in Canada.

Maybe. But they are still a ways off and even further off for the sub 1 000 population villages that we are discussing in many cases.

Originally Posted by scumtoes

Renewables have seemed to prove themselves ineffective and unreliable.

They don't have to be the 100% solution to do a lot. Read the Macleans article I posted. They were able to cut fuel imports by a quarter just by building a solar farm for that town. And now that the technology is getting better and cheaper every year, it's possible to simply deploy renewables and let them leave their existing generators as backup to the renewables. We get emissions cuts. They get much lower energy bills. Just like the clean water issue, we do have an obligation to avoid energy poverty with these communities.

[ssiguy]

Originally Posted by Psychedelic Sailor

This is at best dishonest

I don't know how?

Nunavut gets 100% of it's electrical supply from diesel so I don't know where the claim of dishonesty is. As far as putting up windmills, they are ideal for isolated areas that are not connected to the grid and yet Nunavut hasn't put up a single one and not even in Iqaluit.

It's not a matter of it being "easy" but the fact remains that Nunavut hasn't even attempted to find out if wind and/or solar is viable in any of it's many isolated communities.

Yes, I am also blaming this on the Natives themselves as outside of Iqaluit, these communities are almost exclusively inhabited by indigenous people. Also, most Natives refuse to leave their communities but then complain about climate change yet these villages are EXCEPTIONALLY highly GHG emitters on a per-capita basis as everything has to be imported via highly polluting air and/or cargo.

[Truenorth00]

Originally Posted by ssiguy

I don't know how?

Nunavut gets 100% of it's electrical supply from diesel so I don't know where the claim of dishonesty is. As far as putting up windmills, they are ideal for isolated areas that are not connected to the grid and yet Nunavut hasn't put up a single one and not even in Iqaluit.

It's not a matter of it being "easy" but the fact remains that Nunavut hasn't even attempted to find out if wind and/or solar is viable in any of it's many isolated communities.

Yes, I am also blaming this on the Natives themselves as outside of Iqaluit, these communities are almost exclusively inhabited by indigenous people. Also, most Natives refuse to leave their communities but then complain about climate change yet these villages are EXCEPTIONALLY highly GHG emitters on a per-capita basis as everything has to be imported via highly polluting air and/or cargo.

You seem to be utterly ignorant to the cost of building the kind of infrastructure you suggest in these communities. Read the Macleans article I posted. They spent an insane $1350 per panel to build that solar farm. This is why, so many of them are waiting for federal funding to help out. Your post is about as insensitive as blaming them for their water issues.

Where they can, First Nations have been among the most enthusiastic supporters and investors in renewables. But those usually aren't the remote communities where costs are exorbitant.

[rofina]

Came across a great article that articulates something I have been trying to square in my own thinking and that is; how much energy does it take to produce energy?

Without being a genius, one can figure out that resource extraction is very energy heavy, trucks, plants, refinieries, pipelines, diggers, shipping, the whole industry is very energy heavy.

Ironically, obviously as energy costs go up its a bonus for sale price of oil/gas, but it increases the very input costs needed to extract it to begin with.

What's interesting and little discussed is how this affects the green energy transition. We don't really talk about it much but oil/gas is so much more than gasoline for cars.

The vast majority of everything we produce, including renewable manufacturing, needs oil.

OIL SYSTEM COLLAPSING SO FAST
It May Derail Renewables
Warn French Government Scientists

https://bylinetimes.com/2021/10/20/o...nt-scientists/

A team of French government energy scientists are warning that the collapse of the global oil system is coming so rapidly it could derail the transition to a renewable energy system if it doesn’t happen fast enough.

Their research found that 15.5% – more than a tenth – of the energy produced from oil worldwide is already necessary to keep producing all the oil.

In 1950, the EROI of global oil production was really high, at about 44:1 (meaning, for every unit of energy we put in, we were getting a whopping 44 out). Yet as the graph below from the new study illustrates, this value has undergone a shockingly steep decline.

By 2020, it reached around 8:1, and is projected to decline and plateau to around 6.7 from 2040 onwards.

Over the next decades, then, oil and gas investments will become ‘stranded’ due to three converging pressures: climate policies demanding that fossil fuels stay in the ground; plummeting demand as fossil fuels and combustion engines are increasingly disrupted by solar, wind, batteries and EVs; and accelerating “energy cannibalism” as the oil and gas industries, ironically, consume themselves into oblivion in the process of trying to keep going.

if we delay the clean energy transformation for too long, there might not be enough energy to sustain the transition in the first place – leading to a ‘worst of all worlds’ scenario: the collapse of both the fossil fuel system and the ability to create a viable alternative.

There’s no time to lose. The new research led by the French team confirms that whether we like it or not, human civilization is in the midst of the most rapid transformation of the global energy system we’ve ever experienced. And hanging on for dear life to the old, dying fossil fuel paradigm is a recipe for civilizational suicide.

The risks here are so obvious. Transitions take generations, governments move like glaciers in any circumstance, approving a new bridge or infrastructure project often take decades from inception to completion.

My greatest concern is that by the time we find urgency in any of these issues it will simply be logistically too late - we are collectively going to rethink of how we decision make and how we take constant actions to restrict ourselves from acting.

[Truenorth00]

Ha. I was going to post this article. Didn't have the time.

This only adds to the pressure. All those 2050 goals? Nah. Most of this is going to happen by 2040. This is also why groups like Carbon Tracker, Carbon Brief, Rethink X, are arguing that high cost oil will be toast much earlier than people imagine. And financiers are realizing this much faster than everybody else. This is exactly why investment is drying up and refocusing to lower cost and lower carbon intensity oil. It's also why capital is not flooding in, even at $90/bbl. Wall St. didn't get rich being dumb.

[ssiguy]

^^^^ This is very true and to add to this is that companies that invest in oil are finding that more and more it's hurting their stock price due to the bad PR.

[DoubleK]

Originally Posted by rofina

Came across a great article that articulates something I have been trying to square in my own thinking and that is; how much energy does it take to produce energy?

RBC touches on that aspect briefly in this report they posted.

The oil sands aren’t the only source of emissions in the sector, and because of Canada’s geography, a lot of energy is needed to get other forms of energy out of the ground and through pipelines to market. In conventional oil and gas production, two-thirds of emissions come from methane venting or leaks, as well as from naturally occurring CO2 in oil wells.

[JustForTheHalibut]

Originally Posted by ssiguy

I don't know how?

Nunavut gets 100% of it's electrical supply from diesel so I don't know where the claim of dishonesty is. As far as putting up windmills, they are ideal for isolated areas that are not connected to the grid and yet Nunavut hasn't put up a single one and not even in Iqaluit.

It's not a matter of it being "easy" but the fact remains that Nunavut hasn't even attempted to find out if wind and/or solar is viable in any of it's many isolated communities.

Yes, I am also blaming this on the Natives themselves as outside of Iqaluit, these communities are almost exclusively inhabited by indigenous people. Also, most Natives refuse to leave their communities but then complain about climate change yet these villages are EXCEPTIONALLY highly GHG emitters on a per-capita basis as everything has to be imported via highly polluting air and/or cargo.

I don't think it be the government to tell the indigenous how they should govern themselves. But I also don't think that the indigenous should be left to figure things out for themselves which has probably left them in their current predicament.

If the feds are to help the inuit, the inuit should have to sign off on it so that the federal government isn't liable if the inuit change their minds and want compensation for others having tried to help them.

The catholic church probably wish they had the indigenous sign off on residential schools back when they tried helping integrate the first nations into the 20th century by educating them.