How the Industrials Industry is Impacting Global Economies

“If you can’t make it, you have to mine it.”

Industrials
24th May 2019

Leading this division has allowed me to gain a deep understanding of how all subdivisions within the Industrials sector operate. More importantly, it has made me realise just how well connected these industries are and I believe, now more than ever, that the world needs to realise this in order for societies to continue to function rationally and responsibly.

“If you can’t make it, you have to mine it.”

A simple phrase, but one that the western world seems to continuously forget. Whether this be the phone you are tweeting on, the car you are driving, or the furniture you have bought; these materials are derived from somewhere and, more often than not, produced in the developing world. Our demand for these materials bring a large number of jobs and sources of income to people and countries which may not have had these prior. It would be ignorant to say that the industry is completely innocent in its practices or that is has never stepped a foot out of line. However we cannot, on the whole, be too quick to judge an industry on which our daily lives are so dependent, and we can’t ignore the fact that we have access to many modern luxuries due to these extractive sectors.

These metals feed into all infrastructure around us and also all power generating assets, including renewables. Now that we are moving to a “greener world” and developing nations are electrifying their economies further and further every day, there is now more need than ever for miners around the world. For electric vehicles (EVs) alone, the demand for copper is three times as high compared with traditional combustion engines (not including what is needed to provide the infrastructure for their effective use).

For perspective, in the UK alone, there are 34.7 million cars that will ultimately be replaced by EVs. If you consider the future demand in developing country such as India or Nigeria, which have respective populations of 1.4 Billion and 200 Million, it is easy to see (in this example alone) just how large the task at hand is in the decades to come. As the Earth’s population continues to grow, predictions suggest it will double by the end of the century, the demands will only continue to increase, and so will the demands for these materials.

The move to EVs is hugely positive in terms of reducing pollution and CO2 in the atmosphere, but the question of where this new energy will come from and how much more is needed still remains. Battery storage at present isn’t advanced enough to provide such a large-scale solution. Although renewable energy has made dramatic advancements in recent years, it does not provide the consistency required to power a nation’s car fleet.

The next available “greenest” solution, which can be deployed on such a large scale, will either be Gas or Nuclear. At present, Gas is becoming more accessible to the world through LNG & fracking; and the oversupply of uranium over the past 10 years has meant extreme difficulties for the commodity. Irrelevant of this, this is an example of how a green solution may need to utilise these “polluting industries” to operate successfully – demonstrating the connection between the two.

Looking to the future of Power Generation, I am a strong believer in renewable energy deployment globally; despite the demands on electricity grids getting greater and greater as populations increase, particularly in the more developed areas of the world.

The reason why I stress the “developed areas of the world” is that those of us living in these nations have to be mindful that the most feasible solutions for a lot of countries, living without or with limited electricity, may not be renewables. Building large-scale coal power plants which can be fuelled by local mines will allow for more job opportunities, which will in turn fuel greater economic prosperity than building a self-sustaining renewable asset.

The other side of this argument would be to say that the deployment of small scale solar would be a more logical solution, but this brings us back to the reality that a mixed approach is necessary. It would be unrealistic to think that a “one size fit’s all” solution is appropriate.

We need to pair education with a passion to drive for a cleaner future, so that we can find the most realistic path going forward.

It is vital that we are open-minded in the methods by which we overcome the stark and real issues with climate change. We can do more by setting an example and overcoming issues which can then be exported, as opposed to dictating how others should behave.

Ten years ago we would never have believed the landscape of the power generation industry would look so different. This is only going to develop further in the next 10 years as the world becomes more aware and the needs to change become more urgent than ever.

I believe I have only scratched the surface with these ideas, and I am confident that there is a counter argument or alternative thought to each. However, what I hope this article will highlight is the connectivity of these industries and paths moving forwards – involving more than what meets the eye. We need to be progressive yet pragmatic and remain understanding of the realities of the world at present.

This “open mindedness’ is the key to being able to rationally debate some to these key societal issues - understanding is crucial to be able to progress forward with feasible solutions.

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