In the energy system, there are two major trends. The first one is more renewables, and the second one is more electric. Whether nuclear will create another trend needs more time. But from a very macro point of view, we are shifting from burning underground resources to materializing these resources.
Fossil fuels are concentrated sunlight. It provides an essential service that other resources lack: control. The natural resources are evidently not quite controllable. We are more in the realm of "predicting" them. This prediction and prediction horizon provides us the time span to manage control strategies.
The burning of fossil fuels is a big contributor to global warming. If we are to transition from fossil fuels to renewables, our need for mining will surely increase. Instead of burning them, we will be molding the natural resources into 3D objects like panels, turbines, and overhead lines. The hydrocarbon age is transitioning to the age of a new metal. But the requirement for metals may be huge. There are enough resources around the world. But their location is fixed. That means some countries will be more advantaged compared to others.
There is also another perspective of it. In the Standard Oil and Rockefeller story, there is an interesting point about the supply chain strategies. Rockefeller didn't bother with oil drilling in the beginning. He controlled the midstream. This control gave him enormous leverage over the drillers and the markets. Today China is using the same strategy as Standard Oil.
The world is shifting from an efficient economy to a resilient economy. Resilience is not cheap. Efficiency was fine with flooding the world PV markets with Chinese PVs. On the other hand, resilience requires diversification, idle capacities, storage, and other "not very efficient" tools. Someone has to pay for these tools, and it is consumers.
Energy resources are a mixture of two major components: Technology and resource. When you have coal, technology need was not the major component of this investment. But when you have solar and wind, it is all about technology. So the share of a resource-technology dilemma varies from fossil to renewable resources. If the technology is more exotic (requiring rare earth materials), resources to materialize that technology becomes critical. There is always a possibility to invent new technologies by changing the structure of carbon atoms or nanotechnology. But reality dictates a new kind of resource dependency.
So there will be a competition between two kinds of resources for the transition period. One is the resources for combustion, and the other is resources for materials and technology. This will also create a competition of geographies. The major tested strategy is to control the midstream for all these resources, whether it is lithium or oil.
Therefore geography is returning with a vengeance. The technological shift can be faster, but bottlenecks are not visible in the Excel sheets or models. They will be more visible as demand surges. We are creating a new resource dependence on the top of the current dependence. This is what we will discuss in the following decade.
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