The Solar Power Problem(s)

For solar power to make sense, there’s one non-negotiable component…and yes, it’s that bright, shiny thing in the sky – the sun. But just because your planet has a sun doesn’t mean you should use solar power…

The best examples are places like Denver or SoCal, where the sun is out showing off most days of the year. Then you move on to places like New York, Toronto or Berlin – which have plenty of overcast days – and your case for using solar power goes out the window.

The point of all of this isn’t to say that solar power can’t be part of the energy solution, but there are still quite a few hoops we’ve got to jump through to get there.

Prefer to read the transcript of the video? Click here

Join me on Feb. 17th for the webinar – Global Outlook: One Year into the Ukraine War.

We’ll dive into the global impacts the war has had on supply chains, agriculture, and much more. After my presentation we’ll have a Q&A portion to answer all those burning questions.


Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY


TRANSCIPT

Hey everybody. Hello from Colorado. Peter Zeihan here. Today I wanted to talk about solar. Since it’s a sunny day. I am green, but I’m a green who can do math. So I don’t get invited to really any of the green parties. Solar is great if you know, if you have one of those a sun, not just you have to have one for your planet. You have to be able to see it regularly. Solar intensity around the world varies by an order of magnitude based on where you are, and if your goal is to both generate a meaningful amount of electricity and reduce your carbon footprint. There are only a handful of places where today’s solar technology really work well.

Now I live in one of them. Denver is the sunniest city in the United States, and people like, Oh, shouldn’t that be Phenix or Dallas – no. Because there’s more things that go in there than temperature, humidity, air density, wind patterns, weather patterns. Denver sits on the Lees side of the Rocky Mountains. So it’s in the rain shadow of the largest mountain range on the continent. And it gets its weather in two phases. Either storms that blow in from the mountains or storms that blow off the Great Plains. In both cases, the storms tend to be cold fronts, so they whip through fast. They drop a lot of rain or snow and then they move on, leaving clear air behind.

If you’re in Phenix, you’re going to be dealing with a lot of particulate matter because of the dry desert nature of the place and a lot of smog. If you’re in Dallas Fort Worth, you’re dealing with humidity. There just aren’t very many places in the world that have a really good solar quotient. And in the United States, you’re pretty much talking about the California coastline into southern California and then into the desert southwest. And there’s this little hook up the east side of the front range, which is where I live. In fact, I’m one up on Denver because I’m at 7500 feet. So we regularly get snow in our valleys and fog in our valleys and Denver will get fogged in. But I am a half a vertical mile above Denver and so it is very rare for my neighborhood to be fully cloudy for a whole day. It only happens about 20 or 30 days a year as opposed to when you have an atmospheric haze, which in most populated parts of the world lasts pretty much, you know, entire seasons.

That means that my panels, if you were to put them in New York, only generate about a quarter of the power that they generate for me. Put that in Toronto you’re down to one fifth. You put in Berlin down to one sixth. As a rule, most of the human population, most notably in Southeast China or excuse me, and the East Chinese coast, Northern Europe and Northeast United States. If you put up solar panels, you are most likely generating more carbon from the creation of a panel and transmission system than you’ll ever pay down from the electricity that you generate. So you’re actually contributing to the problem rather than solving it.

Which brings us to a second problem. I live in a rural area, so I’ve got a big roof line and I have an 11.5 kilowatt solar system, which is about the maximum of the Colorado allows when you’re going to do a feed in tariff, which is a fancy way of saying that you pay into the grid with electricity, the same rate that they charge you going to get it out. It’s a great system we’ve got here in rural Colorado. Most cities don’t have that option. Number one, you’re going to have to have a more profit driven electrical system. I work with a co-op, which means they’re not going to give you as generous of feed in rates and second cities by their very definition, are densely populated. Solar, by its very nature, has to be distributed.

So, yes, if you live in a traditional single family neighborhood with homes, with sizable roof lines and a lot of south facing frontage, you may, may, be able to have a decent solar quotient for your system, especially if you live in the American Southwest or California. But if you live in a mid-rise, much less a highrise, much less in a calculated city like Chicago or New York, there’s nowhere to put the panels in the first place. You’re going to put them outside of the city, and now you’re talking about transmission costs. And if you’re in New York, you’re not going to put it outside of city of New York because that’s equally cloudy. You’re going have to go down like central Virginia. And then there’s a half a dozen major cities between you and we’re going to be pulling your power from.

It’s not that solar can’t be part of the solution. It can. But it really only works in some very specific geographies like where I live, where it works really well. For us to fix this, three things need to change. Number one, we need panels that capture more of the sun and translate more of its energy into electricity. The rate of recovery for that has been incrementally going up for a while now. There is now panels on the drawing board, not on production, on the drawing board that can capture as much as half. That’s great. A huge step in the right direction. But you also then need transmission to get it from places that are sunny and you put up your solar panels where people actually live. And to do that at scale, we’re not just talking about high voltage lines that cross state lines, we’re talking about relatively room temperature semiconductors. And for those of you been following some of my other energy work, you know, the same thing is basically basically necessary for diffusion power as well. Single large facilities that you want nowhere near a city that can transport the power over hundreds of miles if necessary.

But the third thing that’s probably going to be the most problematic in the near term, and that’s capital. When you put up a solar farm or wind farm or any sort of green tech, you have to pay for it up front, which means you have to finance it. If you’re putting up a coal and natural gas plant, most of the cost of operating that plant over its lifespan is in fuel. So you pay for that as you go. The financing needs are not nearly as much. And with the baby boomers moving into mass retirement and liquidating all of their high velocity capital, all their stocks, all their bonds, everything is going into T-bills and cash. And the volume of capital that is available to finance green tech projects just isn’t going to be there at the scale we’ve become used to. And that’s not just for green tech. That’s for everything from car loans to borrowing to pay for super carriers, everything is going to get more expensive to finance. And since green tech must be financed upfront, it is going to be the economic subsector that’s probably going to suffer most dramatically over the next few years. Unless the technology changes, you change the technology on me. I reserve the right to change my mind.

Alright. That’s it for me. Until next time.

Material Processing: The Redheaded Stepchild

Today we’re talking about the overlooked redheaded stepchild between mining raw materials and incorporating those into a product…processing. Essentially throwing tons of energy at the ore through several steps and facilities, converting them into usable materials like aluminum or steel.

For the vast majority of materials, this processing is carried out in 1 of 2 locations – China or Russia. This is a result of subsidies or cheap energy. However, all of that is changing thanks to the collapsing demographics of these two societies.

The reason for the redheaded stepchild analogy is that processing is about to become very annoying for the rest of the world. Not because it’s expensive or difficult to do but because the decrease in supply is culminating with an increase in demand thanks to the green movement.

Prefer to read the transcript of the video? Click here

Join me on Feb. 17th for the webinar – Global Outlook: One Year into the Ukraine War.

We’ll dive into the global impacts the war has had on supply chains, agriculture, and much more. After my presentation we’ll have a Q&A portion to answer all those burning questions.


Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY


TRANSCIPT

Hello from sunny Colorado, Peter Zeihan here. Today we’re going to talk about processing. So a lot of people are familiar with some of the issues and opportunities that come from any number of industrial materials, whether that’s iron ore or aluminum or lithium or cobalt. But in between the mining and the actually incorporating the product into something that we actually use like lithium into a battery or steel into a car, there is an intermediate processing step that tends to just kind of get ignored and that’s about to become a very large concern for any number of sectors and countries.
Once you get the raw material, the ore, the industrial material itself out of a mine, you then have to basically throw a lot of energy at it. Breaking down the orders to separate out the metals or the other materials that are within is an incredibly energy intensive process that usually takes place over several steps and within those several steps, not always can the same facility do all the same processing.
So for example, you can smelt bauxite in order to get an intermediate product that looks a lot like cocaine called alumina. But then a different facility is needed to basically electrocute the crap out of it in order to transform it into aluminum. And you’ve got processes like this for everything, typically for steel, your first step is to throw it into a foundry with some coal into a blast furnace, and then you get something called pig iron. And then as a rule, another facility will turn it into type of iron and steel that we use every day.
Now, the problem we’re facing is that most of the world’s materials processing is done in two specific locations. The first is in China. Now the Chinese have heavily subsidized their entire industrial base whenever they find a technology that they can master without needing input from another country. And since steel smelting was developed well over a century ago, this is something they have no problem doing. So they are by far the world’s largest producer of raw and finished steel. Though subsidies have taken the form in many cases of financial assistance. Basically, if you can get a bottomless supply of 0% loans and you can build whatever infrastructure you want, and that’s helped drive more profit driven industries out of business around the world.
The second big player is Russia, and this is largely because they have very cheap electricity, because when the Soviet system collapsed in 89, the entire industrial base basically went kaput, except for the electricity generation system. So what the Russians did was they would import raw materials, use their cheap power and their cheap coal to do the processing, and then export a degree of value added materials. And they do this pretty heavily with aluminum. They do this with chromium, they do with this what, titanium materials that they don’t really mine themselves, but they will bring them in for processing. There are very few materials in the world where this is not true. And if you’ve been following me for some time, you know that these are the two major countries that are facing the biggest demographic economic, financial and security crises of the world we’re evolving into.
So we need to prepare for a system where materials that come out of these two countries, intermediate and finished materials, maybe don’t go to zero, but certainly face a significant

collapse in the volume that they produce. There’s nothing about this that can’t be done anywhere else. It doesn’t even take a huge amount of time and it doesn’t even take a huge amount of money because a lot of this is technology that’s, you know, 50 or more years old. But that doesn’t mean it’s free. And that doesn’t mean we can do it overnight. And even if all siting and regulatory concerns vanish, you’re probably not going to put up a smelter for cobalt in the United States and anything less than a year.
So not only with the way technology is evolving do we need a lot more critical materials and not only with the industrialization of the United States, do we need a lot more steel and aluminum? And not only with the green transition, we need a lot more graphite and chromium and nickel. We’re also looking at losing a lot of the world’s processing capacity for these things all at the same time. Something’s going to have to give and that is going to be one of the greatest economic arguments, fights and perhaps even wars of the next ten years.
Stay tuned. We’ll talk about more of this sort of thing on and off for the next several months, because it’s getting to the point where it’s becoming not a hypothetical problem in the future, but a problem in the here and now.
Oh, hey, all this talk of processing reminds me that we are having a webinar on February 17 that is going to be going into the economic implications of the Ukraine war one year on, and the implications for Russian minerals and minerals processing is a big, big part of all of that. So we’re going to include the sign up information for that webinar at the end of this email. Feel free to come. Anyone who signs up is going to get a PDF of the full presentation, complete with the data and the graphics, as well as a link to the video itself for future ruminations.
Okay, that’s it for me. For real. Until next time

EV’s Not-so-little Dirty Secret(s)

Ok ok ok fine I’ll do it. For the past few months I’ve been putting out videos on a host of topics, and in pieces on automotive or trade or greentech or whatnot I’ve mentioned as an aside that electric vehicles are on average a bad idea that will not be with us all that much longer, but I’ve failed to make good on the promise of “a topic for another video”.

Well, here it is. It doesn’t really matter your angle of attack on this topic. EVs in their current form are a disaster strategically, economically and environmentally, and that’s before you consider the withering of Tesla.


Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Where in the World: Quartzite and Greentech

NB: The following video is one I recorded while on my annual backpacking trip in August; please excuse any potential anachronisms.

After a strenuous trek to Quartzite Peak, the views are what make it all worth it. While we’re on the topic of things that we hope are worth it, let’s talk about Greentech – solar and wind in particular.

The underlying goal of these green solutions is to produce clean energy at scale, that can be effectively used. Solar has surged into the spotlight, but the shadow it casts is often overlooked. I’m not saying there’s no place for solar energy, but hefty considerations need to be made beforehand.

Wind offers a more promising outlook; lower environmental impacts, reliability and better financials. However, both of these technologies have a long way to go before they are powering the world efficiently and effectively.


Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

The Fusion Breakthrough: 70 years in the Making

FUSION. The clean energy of the future. No carbon footprint. Bottomless. Cheap. Sound too good to be true? Well, if it looks like a duck…

Before I express my concerns, I want to acknowledge how monumental this step is. It’s taken 70 years to achieve what has just been done, so slow clap for the team that got us here. However, don’t go buying those fusion lamps just yet.

We still need a few more “breakthroughs” before fusion becomes the energy of the present. Think scale, transmission, and materials. It took us a long time to get here, so what’s another half-century…right?


Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Why I’m Bullish on Houston

When you think about cities with bright futures, what are the factors you consider? Energy Production? Agriculture? Population? Manufacturing? There’s plenty more, but let’s focus on those.

Houston is a leader in all of that…and more. So once the global supply on each of these inputs and outputs dips into a deficit, Houston will be primed and ready to fill the need.

Established infrastructure + decreased supply = more money = more investment = Houston becoming one of the most dominant players in global production. Does me being bullish on Houston make a bit more sense now?


Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Tanker Attacks and the Fall of Transport

In the early hours of November 16th, an oil tanker was struck by an armed drone off the coast of Oman. Strikes like this might not sink a ship with 1 or even 5 hits…but it is a sign of the changing times in maritime shipping.

As I mention in the transport section of my latest book – The End of the World is just the Beginning – “Inhibit [safe and cheap transport] and the rest of…everything simply falls apart.” What we saw yesterday was only the tip of the iceberg.

As the safety of the world’s shipping industry becomes more vulnerable, prices will increase and the long-range trade and maritime shipping the world has grown accustomed to will be changed forever.


Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Something Fishy in the Baltic Sea…

Something’s damaged the Nord Stream supply lines that transit through the Baltic Sea. Inconvenient in the best of times, sure, but in the current geopolitical climate there are tons of theories and fingers being pointed all around. 

Was it the Americans, wanting to prevent the Europeans from crawling back to an abusive natural gas supplier? The Russians themselves (despite already electing to voluntarily halt gas supplies?) Tough love from Baltic Euro states? Ukrainian Saboteurs? A freak accident? 

Frankly, none of the these theories hold up. This is one of those moments where as much as we’d like some immediate clarity, we’re simply going to have to wait and see…


We have never and will never charge for our newsletters or videos, but we do have an ask. If you enjoy our products, we ask you consider supporting MedShare by clicking one of the links below. MedShare is an established non-profit organization that helps respond to medical need globally, including to the ongoing crisis in Ukraine.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

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Gazprom Declares Force Majeure: How We Got Here

Gazprom, the Russian state’s gas monopoly notified its European customers that it was declaring force majeure in its supply contracts going back to June 14, citing “extraordinary circumstances” preventing the delivery of natural gas. It’s easy to guess what the circumstances referenced are–the conflict in Ukraine, sanctions, etc. Is this just Russian brinksmanship? A negotiating chip?

Maybe. Probably not. We shouldn’t forget that Nord Stream 1, the direct gas pipeline between Russia and Germany, is currently undergoing routine maintenance until later this week. There’s still no strong indication that Russian gas supplies will resume in whole or in part, and with today’s declaration Moscow has legal cover to halt energy supplies to the economic heart of Europe. As if legal cover is all Russia needs. 

In the links below, we’ve included a series of videos I’ve recorded over the past few months that outline Russia’s strategy, Europe’s rather pitiful few options, and the rather bleak reality that Russia increasingly sees itself not just at war with Ukraine, but in direct conflict with Europe. To expect energy supplies to continue as normal is a fantasy that not even the most optimistic German industrialists can pretend to believe in anymore. The EU–especially Germany–and Russia both saw the increase of energy interconnectivity and pipeline politics (or “diplomacy”) or the past few decades as a game of increasing leverage. The question was always, for whom? Europe always hoped that it could entice Russian good behavior through economic linkages and purchase contracts. We’re likely to see in coming days where the power in this relationship, pun intended, really flows from.

April 30, 2022 – Russia’s Natural Gas Strategy

June 21, 2022 – The Ukraine War, a New Flashpoint, and the End of Europe’s Energy Innocence

July 11, 2022 – The End of Germany’s World

Electricity in Transition

California. Germany. Texas. France.

Not a normal grouping of places or policies or politics. Especially when one wants to talk about energy. All four, however, are in the midst of a transition to renewable or green energy production and find themselves with having to grapple with energy reality, popular expectations, the vagaries of climate and weather, and rising costs. And all are experiencing a mix of successes and failures, both in and out of their control.