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1. Reclaiming leadership: Australia and the global critical minerals race

Author:
Ian Satchwell
Publication Date:
04-2024
Content Type:
Special Report
Institution:
Australian Strategic Policy Institute (ASPI)
Abstract:
Climate policy, geopolitics and market forces are coalescing to deliver Australia a global leadership opportunity in critical minerals. To grasp that opportunity, Australia needs both to utilise its domestic mineral endowment and its mining knowledge and technology and to leverage the global footprint of Australian companies to help build a global supply chain network. How Australia responds will not only determine economic benefits to the nation but will also affect the world’s ability to achieve minerals security and the sustainability required for the global energy transition and inclusive economic growth. The global energy transition and other high-technology applications have increased demand for critical minerals, particularly in countries that have strong complex manufacturing industries. At the same time, the concentration of production of many critical minerals, the dominance of China in supply chains and its actions to restrict supply and influence markets, are disrupting both minerals production and availability. In response, developed nations have formulated critical minerals strategies and entered into bilateral and multilateral agreements, involving supplier nations and customer nations, to build alternative supply chains that are more diverse, secure and sustainable. Australia has committed in multiple agreements to work with like-minded nations to achieve this. This report is intended to provide the government with a road map to ‘step up’ to (re)activate Australia’s global mineral leadership.
Topic:
Climate Change, Science and Technology, Leadership, Alliance, Emerging Technology, Minerals, and Energy Transition
Political Geography:
Australia, Asia-Pacific, and United States of America

2. The Role of the United States in Just Energy Transition Partnerships in Indonesia and Vietnam

Author:
Melinda Martinus
Publication Date:
07-2024
Content Type:
Special Report
Institution:
East-West Center
Abstract:
Melinda Martinus, Lead Researcher focusing on Climate Change in Southeast Asia and sustainable development at ISEAS-Yusof Ishak Institute, explores the Just Energy Transition Partnerships (JETPs) for Indonesia and Vietnam against the backdrop of the upcoming US presidential election.
Topic:
Foreign Policy, Climate Change, Partnerships, Climate Finance, Energy, Climate Justice, and Energy Transition
Political Geography:
Indonesia, Vietnam, Southeast Asia, and United States of America

3. Tesla as a Global Competitor: Strategic Control in the EV Transition

Author:
Matt Hopkins and William Lazonick
Publication Date:
09-2024
Content Type:
Working Paper
Institution:
Institute for New Economic Thinking (INET)
Abstract:
In this paper, we assess the implications of Elon Musk’s strategic control over Tesla, the pioneering company that has become central to the electric vehicle transition. We document how, as Tesla’s CEO for 16 years, Musk has exercised strategic control to direct the transformation of the company from an uncertain startup to a global leader. Now that Tesla is profitable corporate predators (aka hedge-fund activists) may challenge Musk’s strategic control—a possibility of which the CEO is well aware. To retain his control over Tesla as a publicly listed company, Musk depends on holding a sufficient proportion of Tesla’s shares outstanding to possess the voting power to fend off predatory value extractors. In addition to accumulating Tesla shares by investing $291.2 million at early stages of the company’s evolution, Musk has relied upon massive stock-option grants from the Tesla board, under the guise of “compensation”, in 2009, 2012, and 2018, to boost his shareholding and, with it, his voting power. Hence the Delaware Court of Chancery’s decision in January 2024 to rescind Musk’s 2018 stock-option package—by far the largest ever granted to a corporate executive—poses a threat to Musk’s strategic control at Tesla. As the “Technoking” of Tesla strategizes to maintain his control over the company’s decision-making, anyone concerned with the role that Tesla will play in the evolving EV transition should be asking how CEO Musk might use, or abuse, his powerful position.
Topic:
Science and Technology, Economic Competition, Electric Vehicles, Tesla, and Energy Transition
Political Geography:
Global Focus and United States of America

4. Distributional Implications and Share Ownership of Record Oil and Gas Profits

Author:
Gregor Semienuk, Isabella M. Weber, Iain Weaver, Evan Wasner, Benjamin Braun, Philip B. Holden, Pablo Salas, Jean-Francois Mercure, and Neil R. Edwards
Publication Date:
11-2024
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
The 2022 oil and gas crisis resulted in record fossil-fuel profits globally that rehabilitated the oil and gas industry, obstruct the energy transition and contributed to inflation. We analyse the size and the distribution of financial beneficiaries of these unprecedented profits across countries and across wealth groups within the United States, using company income statements and comprehensive ownership data, to construct a global network of shareholdings with 397,619 nodes. We estimate that globally, net income in publicly listed oil and gas companies reached US$916 billion in 2022. The United States was the biggest beneficiary receiving US$301 billion in fossil fuel profits both from domestic extraction and through global shareholding, more than U.S. investments of US$267 billion in the low carbon economy that year. Analyzing the U.S. distribution including privately held US companies, 51% of profits went to the wealthiest 1%, predominantly through direct shareholdings and private company ownership. In contrast the bottom 50% only received 1%. The incremental fossil-fuel profits in 2022 over those in 2021 were enough to increase the disposable income of the wealthiest Americans several percent and compensate a substantial part of their purchasing power loss from inflation that year, thereby exacerbating inflation inequality. Record fossil-fuel profits also reinforce existing racial and ethnic inequalities and inequalities between groups with different educational attainments. Our results also show that only a small share of overall profits benefits institutions that serve the wider public such as pension funds. We discuss how windfall profits taxes could be used to both lower inequality and accelerate the energy transition as increasing geopolitical tensions and climate impacts portend continued volatility in oil and gas markets.
Topic:
Oil, Gas, Inflation, Fossil Fuels, and Energy Transition
Political Geography:
North America and United States of America

5. The Persistent Consequences of the Energy Transition in Appalachia’s Coal Country

Author:
Eleanor Krause
Publication Date:
03-2023
Content Type:
Policy Brief
Institution:
Belfer Center for Science and International Affairs, Harvard University
Abstract:
The persistence and intensification of earnings, employment, and opportunity gaps across place has become an increasingly salient feature of the United States economy over the past several decades.1 This economic divergence has occurred alongside a remarkable transition away from coal-fired electricity that is expected to continue as lower-carbon energy sources become more economically viable. While essential to minimizing the damages of climate change, the shift poses significant challenges to the relatively rural and distressed communities traditionally reliant on this resource. Indeed, many historically coal-dependent communities in Central Appalachia have long been characterized by deep poverty, limited employment opportunities, and high rates of public assistance, and recurrent adverse shocks to coal employment over the past several decades have amplified many of these qualities, potentially elevating the risks associated with the energy and economic shifts ahead. How have Appalachia’s coal-dependent communities adjusted to historical and contemporary declines in demand for coal, and how do these shocks – and their consequences for the educational composition of affected communities – influence the capacity for future generations to adapt to new challenges? In this policy brief, I present estimates of how Appalachia’s coal country has adjusted to recent declines in coal mining employment (“coal shocks”), and I demonstrate how this adjustment process is, in part, dictated by the persistent consequences of historical employment shocks in Appalachia. The evidence suggests that recent coal shocks (i.e., declines in coal employment occurring between 2007 and 2017) have been relatively painful for affected communities, causing large reductions in local population sizes, declines in local employment counts, declines in earnings, and increases in the rate of government transfer receipt. All of these adjustment costs are more severe in counties with a history of “selective migration” induced by shifting employment opportunities in the 1980s. That is, the estimated effect of recent coal shocks on population sizes, employment, earnings, and transfer payments is significantly larger in counties that lost greater numbers of their college-educated adults in the 1980s thanks to historical employment shocks in proximate labor markets. The upshot is that coal-dependent communities may demonstrate little resilience to recent coal shocks in part because of the persistent consequences of historical shocks, which fundamentally altered the educational composition of affected communities. By dramatically reducing the number of college-educated individuals living in a community, adverse shocks have the capacity to put places on a pathway of decline that makes it more difficult to adapt to economic shifts in subsequent generations. These insights preview the potentially damaging implications of future contractions in the coal industry, revealing the need for greater empirical investigation of the types of policy efforts that might ameliorate the painful local adjustment costs associated with the energy transition going forward.
Topic:
Climate Change, Employment, Coal, and Energy Transition
Political Geography:
North America, United States of America, and Appalachia

6. Technological and policy pathways to accelerate US industrial decarbonization

Author:
Joseph Webster
Publication Date:
07-2023
Content Type:
Special Report
Institution:
Atlantic Council
Abstract:
Industrial decarbonization in the United States will be an important element in lowering global emissions. US industry released 1.4 gigatons of carbon in 2021, about 28 percent of all US emissions. Lowering these greenhouse gas contributions and modeling effective strategies to achieve reductions will go a long way toward not only lowering the US carbon footprint, but also leading global decarbonization efforts. To accelerate US industrial decarbonization, policymakers should start with the lowest hanging fruit, such as electrification or cleaning hydrogen for existing use cases, and then expand to more difficult areas. Greening the electricity sector would sharply curtail emissions from electricity-intensive industries, while switching to clean hydrogen in refineries will likely accelerate hydrogen’s relevance for other promising but unproven use cases, such as in steelmaking. By targeting “easier” challenges, policymakers can achieve decarbonization gains as quickly as possible. The most effective paths to accelerate industrial decarbonization will require permitting reform and pursuing a comprehensive understanding of clean energy deployment, including in transmission. While the United States has enhanced fiscal support for clean energy development, policymakers across the country at all levels of government should reduce permitting review times and ensure that projects are not stuck in regulatory limbo indefinitely. The United States should also research methods of decarbonization, including nuclear energy development, and wires-vs-pipeline transportation costs for green hydrogen. To limit the consequences of climate change, the United States must urgently advance a suite of efforts to guarantee the domestic and international industrial emissions reductions the world needs.
Topic:
Environment, Carbon Emissions, Decarbonization, and Energy Transition
Political Geography:
North America and United States of America

7. Transitioning to the clean energy grid: A deep dive into the levelized cost of electricity

Author:
Ken Berlin and Frank Willey
Publication Date:
08-2023
Content Type:
Policy Brief
Institution:
Atlantic Council
Abstract:
The climate crisis requires the world to transition rapidly from fossil fuel-based to renewable-based electricity generation. Studies of the levelized cost of electricity (LCOE)—the average price at which a power plant must sell each megawatt-hour of electricity to recover its costs—show that renewable electricity generation is well-positioned to meet energy transition goals because it is cost-competitive. LCOE suggests that on-shore wind and solar generation are the cheapest power options in the United States and for two-thirds of the world population. But LCOE does not tell the full story.
Topic:
Electricity, Energy, and Energy Transition
Political Geography:
North America and United States of America