The necessary persistence when building a green tech supply chain

Mike Fourcher

Mar 5, 2024 — 4 min read

A Soviet Robotron 1715, manufactured in the old German Democratic Republic (East Germany) in 1984, it had no sound or mouse port. Perhaps this is what Western green tech looks like to today's Chinese engineers. (Boing-boing)

As an American boy growing up in the 1980’s, I was obsessed with Soviet technology. It seemed to me a strange, bizarro world compared to the tech we had in the US. Their phones were large and clunky, as were their cars and personal computers. I was a computer nerd, and managed to build my own PC by the age of 12, in 1985. Around that time I saw a television news report on Eastern Bloc coders, who worked with machines clearly less advanced than the one in my bedroom. This pampered Westerner could hardly believe they got anything done at all.

Now, it seems as if the West is headed in the direction of the old Soviets with battery and green tech. The US is on the losing side of the tech race this time, and whereas the Soviets lagged with their tech due to a lack of entrepreneurial muscle, the US and Western countries are lagging in green tech because they lack China’s persistent industrial direction.

The world’s green tech supply chain stands on four legs: raw minerals, refining, technological prowess, and manufacturing capacity.

The raw materials for green generation and EV batteries, such as nickel, cobalt, lithium, copper, manganese, and graphite, are typically found deep in the earth, and usually not in geographies controlled by Western countries. When found, it can take a decade to prove a mine and then get it working. Once operating the mines can be ecological disasters, and are often in difficult to reach places, like southern Congo, so years more are spent building rail and truck lines to get the minerals out.

Next, building refining capacity can also take years of permitting and construction and the processes often require use of acids and other toxic chemicals.

Manufacturing is probably the most straightforward part of the EV revolution – at least for Western countries. It requires a highly trained workforce, but like most complex manufacturing processes, it’s the sort of thing you only get better at as you do more of it. And that goes double for green tech and battery development. The more batteries and turbines you build, the more your engineers and scientists can iterate.

Chinese companies are leaders in all of these areas. Battery and green tech design, as well as manufacturing. Also, for over a decade Chinese companies have been investing in the extraction and refining of minerals needed for green tech (as discussed here last week), to the extent where Chinese-owned companies almost totally dominate mineral supply, and the American establishment is calling it a “national security” threat.

To catch up in the green tech race, the US and Western countries will need to do more than just invest in manufacturing and design, they will need to commit to a decade of building a supply chain, slashing permitting, and fully committing to a green tech revolution. Moving from the fossil fuel supply chain to green tech will be like the last industrial revolution a hundred years ago when we rid ourselves of ferriers and saddle makers and built the first automotive assembly lines.

But while the US Inflation Reduction Act and the EU’s Green Deal are promising starts, currently half of the US and European political establishments are calling for increased fossil fuel use, endangering the long-term persistence needed to develop access to minerals and manufacturing prowess. As a result, this year’s elections will likely determine whether China retains its dominance in green tech, and if the West will be relegated to using a green version of 1980’s Soviet technology.

Ideas

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